Domestic production of offshore wind power boosting systems is leading, and the downstream market is diversified. The company was founded in 2015 and is a leading domestic transformer company. Its products are used in the field of new energy. Among them, the domestic share of marine wind booster systems is leading; in recent years, the company's data center and power grid industry revenue has grown rapidly. The company's products have been exported to more than 40 countries and regions, and are actively developing overseas direct sales markets.

Offshore wind power has resonated with the global economy, and the company is forward-looking to develop large-scale supporting products. The domestic offshore wind power market has been gaining momentum for a long time. The CAGR of new installed capacity is expected to reach 31% in 2024-2027; the long-term plan for ocean wind in the international market exceeds 450 GW, and Europe is expected to take the lead in volume. Larger units place higher demands on transformers. The company leads the industry in dry/ester transformer products, and has a forward-looking layout of floating and 66/110kV transformers and combined electrical products. In recent years, leading domestic mainframe companies have actively promoted international development, and the related party Mingyang Intelligence has led the export of domestic offshore fans.

Offshore photovoltaic development is nearing an inflection point, and the company won the bid for the country's first GW-level project. Since 2023, the three-dimensional certification of marine areas across the country has progressed steadily. Many provinces have issued documents to support the development of offshore photovoltaics. Large-scale project development and application of N-type modules have jointly promoted the cost reduction of offshore photovoltaics. China's offshore photovoltaics are expected to enter the stage of large-scale development during the “15th Five-Year Plan” period. The value of offshore photovoltaic boosting systems is higher than onshore, and the 2025-2026 tender is expected to be implemented intensively. The company's booster system products were used in the country's first GW offshore photovoltaic project.

Artificial intelligence is driving data center construction, and the company has supplied leading customers. The scale of the large model parameters continues to grow. The IEA predicts that global data center power consumption will double in 2022 to 2026, and data center construction demand will increase. According to GMI forecasts, the global supporting transformer market CAGR will reach 7% in 2023-2032, and the market space will reach 100 billion yuan in 2032. The company has supplied leading data center customers and will launch a new MyPower power module in 2024.

Distribution network upgrades drive demand for transformers, and the company actively lays out domestic and foreign markets. Since the “14th Five-Year Plan”, China's power grid investment has remained booming. Driven by multiple demands such as driving investment, iterating distribution network technology, upgrading equipment, and improving the quality of power supply in agricultural grids, China's distribution grid investment has continued to grow. The annual market size of distribution transformers purchased by domestic power grid companies in China is 15-20 billion yuan, and the company's share in China Southern Power Grid has increased rapidly.

Global grid investment will resonate in the next ten years, and the company will seize the opportunity to actively lay out overseas markets.

Profit forecast and valuation: In 2024-2026, the company's net profit to mother is expected to be 0.655/0.838/0.984 billion yuan, respectively, and EPS is 2.10/2.68/3.15 yuan, respectively, with year-on-year growth rates of 31.5%/28.0%/17.4%, respectively.

Through multi-angle valuation, it is estimated that the reasonable valuation of the company is 50.66-56.28 yuan, which is a 20%-27% premium over the current stock price. The first coverage gave it an “superior to the market” rating.

Risk warning: New energy installations fall short of expectations; prices of raw materials have risen sharply; overseas trade frictions have intensified.