Bank of China Securities·2025-05-20 06:18Investment Rating - The report maintains an "Outperform" rating for the electric power equipment and new energy industry [1] Core Views - The electric power equipment and new energy industry is expected to see a gradual recovery in profitability, with a potential industry turnaround as capacity is gradually cleared [1][2] - In 2024, the industry's total revenue decreased by 3.69% year-on-year to CNY 49,934.98 billion, while net profit attributable to shareholders fell by 44.66% to CNY 2,086.33 billion [2][3] - The average gross margin for the industry in 2024 was 18.88%, down 2.29 percentage points year-on-year, and the net profit margin was 5.04%, down 3.46 percentage points [4][5] Summary by Sections 2024 Industry Performance - The electric power equipment and new energy industry experienced a revenue decline of 3.69% in 2024, with total revenue at CNY 49,934.98 billion and net profit down 44.66% to CNY 2,086.33 billion [2][3] - The new energy vehicle sector achieved revenue of CNY 20,445.81 billion, a slight increase of 0.85%, but net profit decreased by 19.39% to CNY 1,096.23 billion [3][6] - The renewable energy generation sector saw revenue drop by 8.97% to CNY 25,195.68 billion, with net profit down 69.69% to CNY 631.44 billion [3][6] - The electric power equipment sector reported a revenue increase of 10.20% to CNY 4,293.50 billion, with net profit rising by 9.80% to CNY 358.66 billion [3][6] 2025 Q1 Industry Performance - In Q1 2025, the industry achieved revenue of CNY 11,025.27 billion, a year-on-year increase of 5.16%, and net profit of CNY 679.87 billion, up 12.25% [5][7] - The new energy vehicle sector's revenue grew by 19.46% to CNY 4,775.68 billion, with net profit increasing by 75.48% to CNY 332.27 billion [5][7] - The renewable energy generation sector's revenue decreased by 5.65% to CNY 5,335.37 billion, with net profit down 23.46% to CNY 266.15 billion [5][7] - The electric power equipment sector reported revenue of CNY 914.21 billion, a 9.98% increase, and net profit of CNY 81.45 billion, up 18.77% [5][7] Investment Recommendations - For the new energy vehicle sector, the report suggests prioritizing investments in the battery cell segment and midstream material sectors with strong integration [33] - In the photovoltaic sector, it recommends focusing on high-performance auxiliary materials and integrated component segments, as well as new technology such as HJT battery equipment [34] - For wind energy, it advises investing in tower foundations and submarine cable segments with significant growth potential [34] - In the hydrogen energy sector, it highlights the importance of companies with cost and technology advantages in electrolyzer production and hydrogen infrastructure [34]