Event: On December 7, at the 2023 China International Maritime Conference (Shanghai Maritime Exhibition), Jiangsu Yaxing Anchor Chain Co., Ltd. (Yaxing Anchor Chain for short) held a cooperation signing ceremony with British Classification Society LR and French Classification Society BV respectively to jointly develop a new product - deep-sea anchor piles.

The first phase of the Wanning 1 million kilowatt floating offshore wind power test project was effectively put into operation. According to GWEC data quoted on Yaxing Anchor Chain's official website, the compound annual growth rate of new floating wind power installations is expected to reach 104.3% in 2020-2025. In 2030, the cumulative installed volume of floating wind power is expected to exceed 16.5 GW. The CLP Construction Wanning 1 million kilowatt floating offshore wind power test project is the country's first million-kilowatt floating offshore wind power test project. The project has a planned installed capacity of 1 million kilowatts, an average annual power generation capacity of 4.2 billion kilowatts, and a total planned investment of 23 billion yuan. The construction is divided into two phases. The first phase of the project has an installed capacity of 200,000 kilowatts. The first phase will be completed and all 200,000 kilowatt units put into operation by the end of the year. Phase II has an installed capacity of 800,000 kilowatts, and will be completed and put into operation by the end of 27.

The company's deep-sea anchor piles are expected to improve the economy of projects related to floating wind power platforms. On December 7, '23, the company held a cooperation signing ceremony with the British Classification Society LR and the French Classification Society BV to jointly develop a new product - deep-sea anchor piles. The main features of this Yaxing Anchor Chain deep-sea anchor pile product are that it has the advantages of simple manufacturing, quick installation, and environmental friendliness to the seabed. At the same time, the mooring system for offshore floating wind power platforms at depths of more than 60 meters faces the dilemma of high manufacturing costs and difficult installation of piling anchors. If the deep-sea anchor piles developed by Yaxing Anchor Chain and the Classification Society can quickly pass engineering analysis and experimental data to prove the viability of their application, the engineering and economic significance after certification is huge.

High-strength mooring chains can effectively reduce the cost of offshore platforms, and the company's R6 level mooring chains lead the world. The R6 class mooring chain is the result of the company's research and development over 8 years, and has also obtained double classification certification from the China Classification Society and the Norwegian Classification Society. According to China Shipping News, Xu Lixin, chief scientist of China Merchants Industrial Group, said that using the R6 class mooring chain not only reduced construction costs for the platform by about 20 million yuan, but also saved a lot of load space for the platform and enhanced the platform's market competitiveness. At the same time, the company also has key core technology research and development projects involving ultra-high strength and low brittleness fracture-sensitive R6 mooring chains for deep-sea anchoring systems for marine engineering equipment.

Profit forecasts and investment ratings. We expect the company's 2023-2025 EPS to be 0.22/ 0.32/ 0.46 yuan/share. Using the PE valuation method, we give the company 50-55 times PE in 2023. We believe that the corresponding reasonable value range is 11.00-12.10 yuan, giving it a “superior to the market” rating.

Risk warning. Market risk; raw material price risk; exchange rate risk.