Introduction to this report:

Under the “six power and six industries” layout, the company continues to promote the development of thermal power, hydropower, nuclear power and emerging industries. Benefiting from the recovery of the thermal power market and the recovery of nuclear power storage, the company's performance development is expected to exceed expectations as the corresponding equipment enters a major year of delivery.

Key points of investment:

First coverage, giving a “gain” rating: Dongfang Electric is a comprehensive power supply equipment supplier. Benefiting from the recovery of the thermal power market and the recovery of nuclear power storage, performance development is expected to exceed expectations. The company's net profit for 24-26 is estimated to be 45.17/60.39/7.408 billion yuan, an increase of 27.22%/33.70%/22.67% year-on-year; the corresponding EPS for 24-26 is 1.45/1.94/2.38 yuan. Referring to the average valuation level of the industry in 24, the company was given 15.92x PE in 24, and the corresponding target price was 23.07 yuan. It was covered for the first time, and a “gain” rating was given.

Relying on the “six electricity and six industries” layout, the company's revenue and profit continued to grow. As a leading global energy equipment manufacturing enterprise, the company has a stable equity structure, extensive industrial layout, and continued to rise in revenue and net profit to mother.

The “ballast stone” of electricity supply is the right time for a revival of thermal power. The problem of lack of electricity continues. New energy installations contribute only limited to power generation demand, and thermal power is still dominant in the short term. As orders for thermal power continue to pick up, demand for thermal power equipment is expected to start a new upward cycle.

Benefiting from the recovery of nuclear power pumping, emerging industries have a comprehensive layout. Pumped energy storage has entered a period of rapid development, and the market space for pumping equipment is expected to expand rapidly. The company's water turbines have a high market share, sales have increased dramatically, and production capacity has been expanded in an orderly manner. Relying on the strong recovery of nuclear power, the company's nuclear power performance reached a new high.

Furthermore, the company has comprehensive coverage of emerging industries, contributing to long-term revenue growth.

Risk warning: The delivery of the company's thermal power orders fell short of expectations; the company's nuclear power and hydropower orders fell short of expectations; the intensification of competition in the wind power industry exceeded expectations.