Investment Rating - The report assigns an "Accumulate" rating to the company, marking its first coverage [4][7]. Core Viewpoints - The company is a leading player in the smart grid sector, with a comprehensive layout across the entire new power system, including source, network, load, storage, and data [1][11]. - The domestic grid investment is on an upward trend, with significant R&D investments supporting growth. In the first five months of 2025, grid project investments reached 204 billion, a year-on-year increase of 19.8% [2][24]. - The global grid investment is also rising, with the company's overseas business revenue growing from 920 million to 3.28 billion from 2019 to 2024, reflecting a CAGR of 29% [3][44]. Summary by Sections 1. Smart Grid Leadership and Comprehensive Layout - The company is recognized as a pioneer in the domestic power automation sector, covering all aspects of the new power system [11]. - The smart grid business is the main contributor to revenue, with projected revenue of 28.47 billion in 2024, a year-on-year increase of 10.7% [13]. 2. Domestic Grid Investment and R&D Support - The report highlights the increasing investment in the domestic grid, with expectations for 2025 to exceed 650 billion [2][24]. - The company maintains high R&D spending, which reached 4.032 billion in 2024, a year-on-year increase of 15.94% [40]. 3. Global Investment and Rapid Overseas Expansion - The company has successfully expanded its overseas business, with significant projects in Saudi Arabia, South America, and Mexico [44]. - The overseas revenue is expected to continue growing, contributing positively to overall performance [3][44]. 4. Financial Projections and Valuation - Revenue projections for 2025-2027 are 645.03 billion, 719.67 billion, and 799.99 billion, with year-on-year growth rates of 12.3%, 11.6%, and 11.2% respectively [4][47]. - The expected net profit for the same period is 84.01 billion, 94.56 billion, and 106.14 billion, with corresponding growth rates of 10.4%, 12.6%, and 11.3% [4][47].

Core Viewpoint - The company achieved significant growth in its energy and power digitalization business, with record contract amounts and sales revenue in 2023, reflecting a strong market position and ongoing innovation efforts [1][2]. Financial Performance - The company reported a total revenue of 2.598 billion yuan in 2023, representing an 8.86% year-on-year increase [1]. - The net profit attributable to shareholders was 31.6012 million yuan, up 2.13% from the previous year [1]. - The company plans to distribute a cash dividend of 0.2 yuan per 10 shares to all shareholders [1]. Business Segments - The energy and power digitalization business generated 1.823 billion yuan in revenue, a 16.12% increase compared to the previous year [1]. - Revenue from substation automation products was 485 million yuan, up 13.22% [1]. - Revenue from power grid dispatch automation products reached 362 million yuan, a 4.65% increase [1]. - Revenue from distribution and utilization automation products was 976 million yuan, reflecting a 22.66% growth [1]. Market Expansion - The company secured a total of 617 million yuan in contracts from the State Grid's centralized procurement, marking a 19.35% increase [2]. - Successful bids included multiple projects in various provinces and significant contracts in the renewable energy sector [2]. - The company also made strides in international markets, winning a distribution network terminal project in Malaysia [2]. Innovation and R&D - The company focused on innovation-driven growth, achieving significant advancements in new technology and product development [3]. - Key developments included a new generation regional dispatch support system and advancements in electromagnetic transient simulation technology [3]. - The company’s subsidiaries also reported steady business growth, with notable revenue and profit contributions [3]. Strategic Outlook - The company aims to leverage new domestic and international opportunities, focusing on expanding its business in renewable energy, storage, and public utilities [4]. - Plans include enhancing capabilities in network security and diversifying business models to drive valuable growth across all three major segments [4].