Investment Rating - The report maintains an "Overweight" rating for the power equipment and new energy industry [2] Core Insights - The energy storage system bidding scale in August 2025 saw a month-on-month increase of over 10 times, reaching 17.7GW/45.7GWh, marking a year-on-year growth of 237.1% and 691.4% respectively [5][39] - The power equipment sector has outperformed the CSI 300 index, with a year-to-date increase of 38.91%, surpassing the index by 22.18 percentage points [12][18] - The report highlights significant growth in the grid-side energy storage system, which reached a bidding scale of 18.2GWh in August, reflecting a year-on-year increase of 437.2% and a month-on-month increase of 521.9% [40] Summary by Sections Market Review - As of September 25, 2025, the power equipment industry rose by 8.19% over the past two weeks, outperforming the CSI 300 index by 7.19 percentage points, ranking second among 31 industries [12] - The wind power equipment sector increased by 8.31%, while the battery sector saw a rise of 12.48% [18] Valuation and Industry Data - The power equipment sector's PE (TTM) is 34.90 times, with sub-sectors like the motor sector at 67.83 times and the battery sector at 37.26 times [25] - The report provides detailed valuation metrics for various sub-sectors, indicating a significant premium over historical averages [25] Industry News - The report notes China's commitment to reducing greenhouse gas emissions and increasing the share of non-fossil energy consumption to over 30% by 2035 [39] - It emphasizes the government's push for large-scale applications of energy storage equipment, focusing on safety and efficiency [39] Company Announcements - The report includes announcements from companies like Datang Group regarding a major offshore wind power project and various corporate actions from firms like Goldwind Technology and Longi Green Energy [42][43] Weekly Perspective - The report suggests focusing on leading inverter companies benefiting from the development of new energy storage technologies, highlighting specific companies such as Guodian NARI and Sunshine Power [44]

Core Insights - The electric grid equipment sector experienced a slight decline of 0.11% on the previous trading day, with Hangdian Co., Ltd. leading the losses [1] - The Shanghai Composite Index closed at 3828.11, down 0.65%, while the Shenzhen Component Index closed at 13209.0, down 1.76% [1] Stock Performance Summary - N Haocreat (301668) saw a significant increase of 190.76%, closing at 61.06 with a trading volume of 188,100 shares and a transaction value of 1.188 billion [1] - Zhezhong Co., Ltd. (002346) increased by 10.00%, closing at 19.14 with a trading volume of 119,800 shares and a transaction value of 224 million [1] - Dongfang Cable (603606) rose by 5.46%, closing at 66.02 with a trading volume of 203,900 shares and a transaction value of 1.358 billion [1] - Sifang Co., Ltd. (601126) increased by 4.83%, closing at 19.10 with a trading volume of 522,500 shares and a transaction value of 1.004 billion [1] - Kelu Electronics (002121) rose by 4.78%, closing at 8.55 with a trading volume of 1,429,000 shares and a transaction value of 1.241 billion [1] Declining Stocks Summary - Hangdian Co., Ltd. (603618) led the declines with a drop of 9.99%, closing at 8.92 with a trading volume of 1,310,200 shares and a transaction value of 1.202 billion [2] - Hualing Cable (001208) decreased by 8.64%, closing at 12.47 with a trading volume of 480,400 shares and a transaction value of 612 million [2] - Zhongchao Holdings (002471) fell by 6.64%, closing at 5.06 with a trading volume of 3,142,200 shares and a transaction value of 1.637 billion [2] - Honglida (688330) dropped by 6.57%, closing at 39.80 with a trading volume of 73,900 shares and a transaction value of 297 million [2] Capital Flow Analysis - The electric grid equipment sector saw a net outflow of 134 million from main funds, while speculative funds experienced a net inflow of 367 million, and retail investors had a net outflow of 233 million [2]

Core Viewpoint - The global power equipment demand is entering an upward cycle, with global grid investment expected to exceed $400 billion by 2025, indicating sustained high demand [1] Group 1: Global Market Trends - AI is projected to significantly drive global electricity demand growth, with data center electricity consumption expected to more than double by 2030, leading to a notable increase in related electrical equipment demand [1] - The demand in the US and European markets remains strong, with the US transformer price index remaining high and China's exports of power transformers to the US increasing by 54% year-on-year [1] - The Middle East market is experiencing rapid growth, with Saudi Arabia aiming to achieve 130 GW of installed power generation capacity by 2030, leading to large-scale investments in transmission [1] Group 2: Export Opportunities for China - China's exports of power transformers to Saudi Arabia have increased by over 200% year-on-year, with TBEA winning a significant order worth 16.4 billion yuan [1] - China's power equipment manufacturing capabilities are strong, with a complete industrial chain, robust risk resistance, and ample production capacity, positioning export companies to benefit from the global demand upturn [1] - In the first half of 2025, leading companies in the export business are expected to achieve rapid growth, with overseas operations becoming a key to future success [1] Group 3: Investment Products - The Electric Grid ETF (561380) tracks the Hang Seng A-share Electric Grid Equipment Index (HSCAUPG), which selects listed companies with at least 40% of their main business revenue from the electric grid equipment sector [2] - The index reflects the overall performance of listed companies in the electric grid construction and technology upgrade sectors, covering various industries such as electronic equipment and industrial metals [1]

Core Insights - The report highlights the performance of the power equipment and new energy sector during the week of September 15 to September 19, 2025, with the Shanghai Composite Index declining by 1.30%, while the Shenzhen Component Index and the ChiNext Index increased by 1.14% and 2.34% respectively. The Shenwan Power Equipment Index rose by 3.07%, outperforming the CSI 300 by 3.51 percentage points [1][2]. Weekly Market Review - During the specified week, the Shenwan Power Equipment Index showed a positive trend, with sub-sectors such as photovoltaic equipment, wind power equipment, batteries, and grid equipment experiencing varied performance, with changes of -0.84%, +5.26%, +5.56%, and +2.06% respectively [1][2]. Key Sector Tracking - The report indicates a significant increase in the bidding prices for various wind turbine models, with the lowest bid price for 5 MW units rising from 1157 RMB/kW in 2024 to approximately 1700 RMB/kW in the first half of this year. Similar trends are observed in other categories, with the 6.25 MW to 7.15 MW units seeing a rise from 960 RMB/kW to 1439 RMB/kW. This suggests that the industry's low-price competition has been effectively curbed [3]. Investment Recommendations - In the photovoltaic sector, the report notes a national strategic focus on "anti-involution" actions, emphasizing capacity integration in the silicon material segment and price regulation across the industry. The sector is currently at a cyclical low, with future policy strength being a key variable influencing market trends. Long-term prospects indicate a shift towards high-quality development, with technology upgrades and market optimization becoming central to competition. Companies such as Aiko Solar, Flat Glass, GCL-Poly, and Junda are recommended for attention [4]. - For the wind power sector, the supply-demand structure is deemed relatively balanced, with good profitability among enterprises. The report maintains a positive outlook on the domestic wind power industry chain, suggesting a focus on companies like Goldwind Technology and Yunda Shares for complete systems, and Oriental Cable and Zhongtian Technology for submarine cables [5]. - In the new energy vehicle sector, rapid growth continues, with a recommendation to focus on battery and component segments benefiting from low upstream raw material prices, highlighting companies like CATL and EVE Energy. Additionally, leading firms such as Hunan Youneng and Longpan Technology are suggested as beneficiaries of industry recovery [5].

Market Performance - The electric equipment sector increased by 1.5% compared to the previous trading day, with Hualing Cable leading the gains [1] - The Shanghai Composite Index closed at 3853.64, up 0.83%, while the Shenzhen Component Index closed at 13356.14, up 1.8% [1] Top Gainers - Hualing Cable (001208) closed at 14.65, up 9.98% with a trading volume of 178,600 shares and a transaction value of 262 million [1] - Jingda Co. (600577) closed at 10.13, up 6.97% with a trading volume of 2.39 million shares and a transaction value of 2.34 billion [1] - Zhongyuan Co. (300018) closed at 8.74, up 5.94% with a trading volume of 295,900 shares and a transaction value of 254 million [1] Top Losers - Hangdian Co. (603618) closed at 11.01, down 9.98% with a trading volume of 1.14 million shares and a transaction value of 1.26 billion [2] - Wanma Co. (002276) closed at 18.67, down 9.24% with a trading volume of 2.04 million shares and a transaction value of 3.88 billion [2] - Honglida (688330) closed at 41.68, down 7.73% with a trading volume of 121,900 shares and a transaction value of 508 million [2] Fund Flow Analysis - The electric equipment sector experienced a net outflow of 521 million from institutional investors and 386 million from speculative funds, while retail investors saw a net inflow of 907 million [2][3] - The top net inflow from retail investors was observed in Jingda Co. (600577) with 155 million, while Hualing Cable (001208) saw a net outflow of 465 million from retail investors [3]

Investment Rating - The report maintains a "Buy" rating for the energy and new energy sectors, indicating a positive outlook for the industry [7]. Core Insights - The report highlights the opening of policy windows and the upgrade of domestic manufacturing in the power equipment and new energy sectors, suggesting a favorable environment for investment [2]. - The photovoltaic industry is undergoing a "de-involution" movement, which has reached the highest strategic level in the country, focusing on capacity integration in the silicon material segment and strengthening price regulation across the industry [4]. - The wind power industry is experiencing sustained high prosperity, with a reasonable supply-demand structure and good profitability for enterprises [4]. Weekly Market Review - From September 15 to September 19, 2025, the Shanghai Composite Index fell by 1.30%, while the Shenzhen Component Index rose by 1.14%, and the ChiNext Index increased by 2.34%. The Shenwan Power Equipment Index rose by 3.07%, outperforming the CSI 300 by 3.51 percentage points [12]. - Among sub-sectors, photovoltaic equipment decreased by 0.84%, wind power equipment increased by 5.26%, battery equipment rose by 5.56%, and grid equipment increased by 2.06% [12]. Key Sector Tracking - The report notes a significant increase in the bidding prices for wind turbine models, with the lowest bid price for 5 MW units rising from 1,157 RMB/kW in 2024 to approximately 1,700 RMB/kW in the first half of this year. This trend indicates that all models' bidding prices are now above their minimum cost prices, effectively curbing the industry's vicious low-price competition [3][21][22]. Investment Recommendations - For the photovoltaic sector, the report suggests focusing on silicon materials, glass, and battery segments that have undergone sufficient corrections and have clear alpha. Companies to watch include Aiko Solar, Flat Glass Group, GCL-Poly Energy, and Junda Technology [4]. - In the wind power sector, the report recommends focusing on companies like Goldwind Technology and Yunda Co., as well as cable manufacturers like Orient Cable and Zhongtian Technology [4]. - The new energy vehicle sector is experiencing rapid growth, with a recommendation to prioritize companies benefiting from low upstream raw material prices, such as CATL and EVE Energy [5]. Industry Price Data - The report provides insights into the price trends of key materials in the industry, including silicon material prices, which have shown significant fluctuations, indicating a dynamic market environment [33][35].

Market Performance - The energy storage and wind power sectors have performed relatively well, achieving positive excess returns compared to industry indices, while the photovoltaic and grid equipment sectors have underperformed [1][2] - The energy storage sector benefits from ongoing industry prosperity and rapid growth in shipment volumes, significantly outperforming industry benchmarks [2] - The wind power sector's bidding market has begun to transmit its prosperity to the revenue side of industry chain companies, leading to a noticeable recovery in their performance [2] Industry Recovery - The photovoltaic sector's performance has bottomed out and is beginning to recover, while the wind and energy storage sectors show an upward trend in their fundamentals [2] - The photovoltaic supply chain, including silicon materials, silicon wafers, and integrated components, is gradually recovering, although auxiliary materials are under pressure [3] - The domestic photovoltaic demand is expected to surge in the first half of 2025 due to the implementation of relevant policies, stabilizing industry prices [3] Supply and Demand Dynamics - The industry is experiencing a significant slowdown in expansion pace due to the enforcement of policies aimed at curbing "involution" competition, leading to an ongoing optimization of the supply-demand structure [2][3] - The wind power sector is witnessing a clear recovery, with revenue growth driven by the transmission of high bidding market conditions to the income side of the industry chain [4][5] Grid Equipment Sector - The grid equipment sector continues to show stable growth, benefiting from a long-term uptrend in global grid investment [6] - The demand for grid equipment is increasing due to the rapid growth of wind and photovoltaic industries, necessitating greater investment in grid infrastructure [6]

Group 1: Target Price Increases - The companies with the highest target price increases as of September 22 include Gaweida (300465) with a target price increase of 98.76%, SAIC Motor (600104) with 37.72%, and Haitian Flavoring (603288) with 27.18% [2][3] Group 2: Rating Changes - On September 22, the rating for TBEA (600089) was upgraded from "Hold" to "Strong Buy" by China Merchants Securities [5][6] - Conversely, the rating for JMC (000550) was downgraded from "Buy" to "Hold" by Industrial Securities [7][8] Group 3: Initial Coverage - On September 22, nine companies received initial coverage, including JMC (000550) rated "Hold" by Industrial Securities, Ximai Food (002956) rated "Hold" by Shanxi Securities, and Gaweida (300465) rated "Buy" by Dongwu Securities [8]

Investment Rating - The report maintains a positive investment rating for the renewable energy sector, particularly highlighting the recovery in the photovoltaic and wind energy segments [5]. Core Insights - The renewable energy sector is showing clear signs of recovery, with significant performance improvements in the photovoltaic and wind energy segments, while the energy storage sector continues to experience upward momentum [1][14]. - The photovoltaic industry is witnessing a rebound in performance, driven by a surge in domestic demand and the implementation of policies to eliminate "involution" competition, leading to price stabilization [2][34]. - The wind energy sector is benefiting from improved bidding conditions, which are translating into revenue growth for companies within the industry [3][21]. - The grid equipment sector is experiencing stable growth, supported by a long-term increase in global grid investment [4][24]. Summary by Sections Overall Industry Performance - The overall performance of the renewable energy sector has improved significantly in the first half of 2025, with a notable recovery in profits, particularly in the wind and energy storage segments [1][15]. - The photovoltaic segment is gradually recovering, with major components like silicon wafers and battery cells showing substantial growth, while auxiliary materials face pressure [1][21]. - The industry is experiencing a slowdown in capacity expansion, with the proportion of ongoing projects relative to total assets decreasing [26]. Photovoltaic Sector - The photovoltaic sector is seeing a recovery in performance, with significant growth in the main supply chain components, while auxiliary materials are under pressure [2][34]. - Domestic demand for photovoltaic products surged in the first half of 2025, leading to a historical high in new installations [2][48]. - The implementation of policies to address "involution" competition is accelerating the exit of outdated capacities from the market [2][34]. Wind Energy Sector - The wind energy sector is showing a clear recovery trend, with revenue growth across various segments, particularly in components like towers and bearings [3][21]. - The domestic wind energy prices have significantly increased compared to 2024, with bidding volumes continuing to grow [3][21]. Grid Equipment Sector - The grid equipment sector is maintaining stable growth, benefiting from a long-term upward trend in global grid investments [4][24]. - The performance of transmission and distribution equipment is particularly strong, with notable revenue growth in the first quarter of 2025 [22].

Core Viewpoint - Zhongtian Technology achieved a net profit attributable to shareholders of 1.568 billion yuan in the first half of the year, representing a year-on-year growth of 7.38% [1] Financial Performance - In Q2, the net profit attributable to shareholders was 940 million yuan, showing a year-on-year increase of 14.09% [1] - Revenue by segment for the first half included: - Marine business revenue of 2.896 billion yuan, up 37.19% year-on-year [1] - Power grid business revenue of 9.975 billion yuan, an increase of 11.97% year-on-year [1] - New energy business revenue of 2.630 billion yuan, growing by 13.69% year-on-year [1] - Profit margins improved quarter-on-quarter, indicating a potential for sustained profitability [1] Order Backlog - The energy network sector has an order backlog of approximately 30.6 billion yuan, with marine series orders around 13.3 billion yuan and power grid construction orders about 15.5 billion yuan, providing strong support for future growth [1] Product Development - The company has achieved mass production of 112G high-speed copper cables, meeting the urgent demand for low-latency transmission in data centers and AI computing clusters [1] - A 224G foamed FEP high-speed copper cable is under development, with mass production expected in Q4, laying a solid technical foundation for future ultra-high-speed data transmission scenarios [1] Profit Forecast - Adjusted net profit forecasts for 2025-2027 are 3.7 billion yuan, 4.5 billion yuan, and 5.5 billion yuan, respectively, down from previous estimates of 3.9 billion yuan, 4.9 billion yuan, and 6 billion yuan [1] - Corresponding PE valuations for 2025-2027 are projected at 16, 13, and 11 times [1] - The company maintains a "buy" rating [1]