Weichai Power(SZ:000338)2026-02-11 02:00Summary of Conference Call Records Company and Industry Overview - Company: Weichai Power (潍柴动力) - Industry: Gas Turbine and Internal Combustion Engine Power Generation Key Points and Arguments 1. Transition from Backup to Main Power Source: The core logic of low-cost advantages is shifting from "backup" to "main supply" in the gas engine market, indicating a long-term industry trend [1] 2. Case Study of Caterpillar: Caterpillar's use of 636 units of 2.5MW gas internal combustion engines to supply power to AI-DC in Utah demonstrates that the scheduling difficulty and economics of large-scale gas internal combustion engines are no longer issues [1] 3. Cost Comparison: In North America, the levelized cost of electricity (LCOE) for natural gas internal combustion engines (3MW) is 13%-15% higher than that of large gas turbines (250MW combined cycle), but it is approximately 15% lower than that of simple cycle small gas turbines. The LCOE of large-bore gas engines is only about 55%-60% of that of diesel engines [1] 4. Demand Shift: The switch in fuel is merely superficial; the core issue lies in the demand side, with large-bore gas engines becoming the new favorite amid the electricity shortage at AI-DC [2] 5. Market Demand Gap: The gas turbine industry is currently in a supply-demand imbalance, with a gap of approximately 50GW due to AI-DC, expected to persist until 2029 [2] 6. Advantages of Large-Bore Gas Engines: Three key advantages of large-bore gas engines that remain underappreciated: - Peak Shaving Capability: Cold start time for large-bore gas engines is only 7 seconds, compared to 20-60 minutes for gas turbines, making them more suitable for rapid fluctuations in grid load [2] - Ease of Use: Quick delivery, easy transportation, and strong environmental adaptability (operable from -45° to 50°) [2] - Scalability: Modular layout allows for rapid expansion without interrupting operations, aligning flexibly with the expansion pace of AI-DC [2] Additional Important Insights 1. Valuation Trends: Caterpillar's price-to-earnings (PE) ratio has increased from 13-17x to 28x, while Cummins has risen from 11-13x to 22x. Weichai Power's comprehensive power business layout is better than Cummins and comparable to Caterpillar [3] 2. Future Valuation Potential: The valuation of Weichai Power is expected to rise to 18-22x PE, with a target price of 30 yuan, continuing to be a strong recommendation [3] 3. Investment Recommendations: In addition to Weichai Power, it is recommended to pay attention to upstream core component companies in the large-bore industry chain, such as Yinlun (supplier of heat exchangers for Caterpillar gas generators), and also to consider Zhongyuan Neipei and Tianrun Industrial [3]