Key points:

Goldwind Technology's traditional main business is the fan and parts sales segment, and the share of wind farm development business has increased. By the end of June 2024, the revenue share of the wind power and components sales segment had decreased from 82.93% in 2019 to 63.20%, and the share of the wind farm development segment increased from 7.14% to 21.79%, mainly due to the company's active implementation of power plant product sales, driving the continuous growth of its main business. In terms of gross margin of various sectors, the gross margin of the fan and parts sales segment remained stable, with a gross margin of about 6.41% in 2023; the gross margin of the wind farm development sector was high, remaining around 65% in 2019-2022, and falling to 47.30% in 2023. Mainly because the wind farm development sector includes power plant products and power generation businesses, the share of unsubsidized affordable power plants has increased, and the gross margin of power plant products is low. As the scale of station construction increases, the overall gross margin of the sector has declined. At the end of June 2024, the gross margin of the wind farm development sector rebounded to 56.44%.

Goldwind Technology ranked first in the domestic market share of new wind power installations for 13 consecutive years; it led its peers in both fan exports and cumulative exports in 2023. According to Bloomberg New Energy's financial statistics, in 2023, the company's new domestic wind power installed capacity reached 15.67 GW, accounting for 20% of the domestic market share, ranking first in the country for 13 consecutive years; the world added 16.4 GW of installed capacity, with a global market share of 13.90%, ranking first in the world. By the end of 2023, the company had accumulated more than 114 GW of installed capacity worldwide, becoming the first domestic wind power manufacturer with a total installed capacity exceeding 100 million kilowatts. In 2023, 6 OEM manufacturers each exported wind turbines to 18 countries. Among them, Goldwind Technology exported 327 units to 13 countries, with a total capacity of 1704.7 MW. By the end of 2023, Goldwind had exported 2,298 units, with a total capacity of 7.312 million kilowatts.

Global fan installations continue to increase, and GWEC expects a CAGR of 8.8% in 2023-2028. According to Global Wind Energy Council (GWEC) data, the world's new installed wind power capacity reached a record high of 117 GW in 2023, the best year in history, and a year of continuous global growth. In addition, 2023 was the year with the highest installed capacity of onshore wind power on record, exceeding 100 GW for the first time, reaching 106 GW, an increase of 54% over the previous year; 2023 was the second best year in the history of installed offshore wind power, with a total installed capacity of 10.8 GW; the total installed capacity of wind power in 2023 broke through the first TW milestone, with a total installed capacity of 1,021 GW, an increase of 13% over the previous year.

Investment advice:

We expect the company's net profit to be 2.298/2.847/3.624 billion yuan for 2024-2026, EPS of 0.54/0.67/0.86 yuan, respectively. The PE corresponding to the current stock price is 15.15/12.23/9.61 times, respectively. Considering that the company is a leading wind power company, the traditional fan sales business is steady, the power plant development and wind farm service business are growing rapidly, and the company continues to expand the fan export business, the company's performance is expected to grow steadily, so the first coverage gave it a “buy” rating.

Risk warning:

Raw material price fluctuation risk; policy risk; industry competition exacerbates risk.