Bank of China International: Fusion company listed in Shanghai, China's controlled nuclear fusion development has entered a new stage

The Zhitong Finance App learned that Bank of China International released a research report saying that on July 22, the fusion company listing and establishment conference was held in Shanghai. At the meeting, 7 central state-owned enterprise shareholders including CNNC signed a capital increase and share expansion agreement, increasing the capital of Fusion Company by a total of 11.5 billion yuan. As an innovator promoting fusion engineering and commercialization in China, the fusion company's formal establishment is an important step in the commercialization process of fusion energy in China. With continuous breakthroughs in technology, commercialization of controlled nuclear fusion is getting closer, and the industrial chain may enter a period of rapid development and fully benefit. It is recommended to focus on listed companies that have manufacturing capabilities for key materials and core components for controlled nuclear fusion devices and have received relevant orders.

Bank of China International's main views are as follows:

As a second-tier unit directly under CNNC, fusion companies are an important platform for commercializing fusion energy

According to Zhejiang Electric Power's announcement, Fusion Company was established on June 24, 1983 and renamed from China Nuclear Fuel Co., Ltd., and is the implementing entity, investment and financing platform, and general manager of CNNC's fusion energy industry. The company will use magnetically restrained tokamaks as the technical route and follow the “three-step” development stage of pilot test reactors, demonstration reactors, and commercial reactors to finally achieve the mission goal of commercializing fusion energy. The formal establishment of the China Fusion Company is an important step forward for state-owned central enterprises to promote the future fusion industry, and has opened a new chapter in speeding up the construction of world-class fusion energy companies.

Fusion companies have received capital increases from shareholders of a number of central and state-owned enterprises to help the development of fusion energy

Fusion is currently a wholly-owned subsidiary of China Nuclear Industry Group Co., Ltd. (CNNC). On July 22, at the fusion company listing and inauguration conference, Fusion Company signed a capital increase and share expansion agreement with CNNC, CNPC Kunlun Capital, Shanghai Future Fusion, China Nuclear Power, Zhejiang Electric Power, National Green Development Fund, and Sichuan Zhongke Fusion. The 7 companies jointly invested about 11.492 billion yuan in Fusion.

According to the announcement of China Nuclear Power and Zhejiang Electric Power, the registered capital of Fusion Company reached 15 billion yuan after the capital increase was completed. According to the capital increase, CNNC held 50.35% of the shares in Fusion Company, 6.65% of China Nuclear Power's shares, 20.00% of CNPC's Kunlun Capital, 11.81% of Shanghai Future Fusion's shares, the National Green Development Fund held 3.19% of the shares, Zhejiang Electric Power held 5.00% of the shares, and Sichuan Zhongke Fusion held 3.00% of the shares. As of H1 2025, Fusion Company's total assets were 5.369 billion yuan, owners' equity was 5.367 billion yuan, no operating income, and net profit - 40 billion yuan.

China's multiple technology routes go hand in hand, and the controlled nuclear fusion industry has entered the fast track of development

Currently, China's controllable nuclear fusion industry has formed a pattern where the Chinese Academy of Sciences and the China Nuclear Power Group are the main players, many commercial companies participate, and multiple technological paths go hand in hand. Among them, in the direction of magnetically constrained tokamak, the Hefei BEST project officially started assembly in May 2025, and is expected to be completed in 2027, and will demonstrate fusion energy generation for the first time in the world; in addition to the magnetically constrained tokamak, on July 18, Hanhai Juneng (Chengdu) Technology Co., Ltd.'s HHMAX-901 mainframe construction and plasma lighting ceremony was successfully held at the company's fusion device base. China's first commercialized linear field inverse position fusion device successfully achieved plasma lighting, marking a major breakthrough in the commercial application of linear field inverse position technology in China.

Investment advice

With continuous breakthroughs in technology, commercialization of controlled nuclear fusion is gradually approaching, and the industrial chain may fully benefit from it. It is recommended to focus on listed companies that have manufacturing capabilities for key materials and core components of controlled nuclear fusion devices and have received relevant orders. We recommend Heduan Intelligence (603011.SH), Lianchuang Optoelectronics (600363.SH), Western Superconductivity (688122.SH), and Antai Technology (000969.SZ). It is recommended to focus on Guoding Optoelectronics (), Yongda Co., Ltd. 688776.SH 600105.SH 600577.SH), Sichuang Electronics (600990.SH), Asahi Electronics (600353.SH), AGCO Cyber (), Yingliu Co., Ltd. (USD), etc. 688719.SH 603308.SH

risk factors

Risk of technology progress falling short of expectations; risk of technology route change; risk of capital investment falling short of expectations; risk of industry policies falling short of expectations; risk of related projects falling short of expectations.