CMB Securities recommends focusing on leading firms and suppliers of materials and core components that have achieved domestic substitution.
According to Zhitong Finance, China Merchants Securities released a research report stating that controlled nuclear fusion, as a strategic high ground for national energy security and technological self-reliance, is accelerating its industrialization process from experimental validation to engineering demonstration. Breakthroughs in material performance are the core bottleneck of technical feasibility. Currently, the overall localization rate of key nuclear fusion equipment exceeds 96%, with core components such as tungsten-based divertors and high-temperature superconducting wires achieving a high degree of autonomy. With the power generation demonstration of the BEST device in 2027 and the new long-pulse record of EAST, the industry is entering a new phase of 'multi-route competition + capital resonance.' It is recommended to focus on leading companies and suppliers of materials and core components that have achieved domestic substitution, maintaining an industry investment rating of 'recommended.'
The main viewpoints of China Merchants Securities are as follows:
The industrialization process of nuclear fusion technology is accelerating, with multiple technical routes advancing in parallel.
As the urgency of global energy transition increases, controlled nuclear fusion, as the ultimate clean energy solution, is moving from laboratory research toward the critical juncture of engineering and commercialization. Currently, the magnetic confinement tokamak route dominates the industrialization process, while inertial confinement and hybrid routes are developing concurrently. Countries are accelerating their deployment through policy coordination and capital investment, with tech giants also actively entering the fusion energy sector. Relying on major scientific installations such as EAST and BEST, China has made breakthroughs in key areas like long-pulse plasma control and high-temperature superconducting magnets. The localization rate of the supply chain continues to rise, and it is expected that the BEST device will be the first to achieve fusion energy power generation (Q>1) by 2027. Recently, the completion of the installation of key components of the BEST device marked the full launch of the main construction, with a total investment of nearly 20 billion yuan, representing an important milestone in the commercialization of nuclear fusion in China.
Material innovation is the core bottleneck and breakthrough point in the current industrialization process.
The extreme operating environment of nuclear fusion devices imposes near-limit requirements on material performance. First-wall/divertor materials must possess high melting points, radiation resistance, and thermal fatigue properties; superconducting materials are being upgraded from low-temperature superconductors (NbTi/NbSn) to high-temperature superconductors (REBCO), enabling magnetic field strengths to exceed 20T; oxide dispersion-strengthened steel (ODS steel) has become an important direction for radiation-resistant structural materials; tritium breeding blanket materials (such as lithium titanate-coated beryllium spheres) enable closed-loop fuel cycling, becoming crucial for the self-sustaining operation of fusion reactors. Domestic companies like Antai Technology, Western Superconducting Technologies, and Lianchuang Optoelectronics have broken foreign monopolies in areas like tungsten-copper divertors, superconducting wires, and tritium barrier coatings. However, material reliability verification and cost control at scale remain pain points in industrialization.
Multiple segments of the industrial chain are witnessing incremental market growth.
Leading energy equipment enterprises have established initial scale, with clear paths for core component development and industrialization. Companies involved in superconductors, first walls, and divertor materials are benefiting significantly. Military enterprises are leveraging high-precision manufacturing capabilities to extend into civilian fields, with Sichuang Electronics (superconducting magnet power modules) and Prince New Materials (pulse capacitors) gaining a head start in supporting segments. Material suppliers like Suiray New Materials (chromium-zirconium copper alloys) and Jiuli Special Materials (PF conduits) continue to optimize fusion-related performance parameters through alloy technology upgrades. Regionally led companies like Guoguang Electric, Heduan Intelligent, and Lianchuang Optoelectronics hold prominent positioning advantages and may benefit significantly from local support. Midstream manufacturing enterprises like Xuguang Electronics and Zhongzhou Special Materials are accelerating the deployment of related products.
It is recommended to pay attention to
Guoguang Electric, Hefei Forging Intelligent (Machinery), Lianchuang Optoelectronics (Machinery), Western Superconducting, Sichuang Electronics, Prince New Materials, Parker New Materials, Antai Technology (Metals), Yongding Corporation (Telecommunications), Xiuguang Electronics (Electronics), Sairen New Materials (Metals), Zhongzhou Special Materials (Metals), Jiuli Special Materials (Metals), etc.
Risk warnings: slower-than-expected technological iteration, material reliability verification, capacity expansion and cost control, uncertainties in funding and policy support, etc.
