中国工业 - 自动化运营追踪 -中国企业强劲势头持续-China Industrials-Automation Operations Tracker – Chinese Players' Strong Momentum Sustained

Summary of the Conference Call on China Industrials Industry Overview - The report focuses on the automation operations within the Chinese industrial sector, highlighting the strong momentum of domestic players compared to foreign competitors [1][5]. Key Points Sales Performance - In September 2025, four global players (Yaskawa, Panasonic, Delta Electronics, and ABB) experienced a decline in sales of servos and low-voltage AC drives in China, with sales down by -5% and -3% respectively, contrasting with positive growth of +4% and -2% year-on-year in the first eight months of 2025 [2][7]. Domestic Players' Orders - Inovance (300124.SZ) reported a significant increase in automation orders, up over 30% year-on-year in September, compared to 20-30% in August. Key markets driving this growth include batteries, logistics, semiconductors, wind power, construction machinery, and machine tools [3][10]. - Wuxi Xinjie (603416.SS) also saw orders grow by over 20% year-on-year in September, maintaining the same growth rate as August [3]. - Tsugami China (1651.HK) reported a solid order volume growth of 33% year-on-year in September, down from 42% in August [3]. General Equipment Orders - Haitian International (1882.HK) experienced a recovery in orders, with low teens year-on-year growth in September, compared to a low single-digit decline in August. Domestic orders showed strong growth while overseas orders increased by high single digits [4]. - Guomao (603915.SS) also reported similar trends with teens growth in orders [4]. Market Demand Insights - The overall demand in the automation sector remains robust, particularly in logistics, battery production, machine tools, electronics, and semiconductors. The PMI index increased to 49.8 in September from 49.4 in August, indicating a slight improvement in manufacturing activity [10]. Investment Recommendations - The report favors Inovance as a leading automation player due to its market share gains and strong drivers in the electric vehicle (EV) powertrain sector, as well as potential in humanoid robotics [10]. Valuation and Risks - The price target for Inovance is set at RMB 95, based on a 35x P/E ratio for its core business and a 5x P/S ratio for its humanoid business [11]. - Upside risks include stronger-than-expected macroeconomic conditions boosting demand for automation products and higher sales of ePVs equipped with Inovance's EV control systems [12]. - Downside risks involve failure to develop high-end automation products and potential gross margin declines due to rising raw material costs [13]. Conclusion - The Chinese industrial automation sector is showing strong domestic growth, particularly among local players, while foreign competitors are facing challenges. The outlook remains positive, with specific recommendations for investment in leading companies like Inovance.