CICC: The overall performance of the power equipment industry is steady and improving in 2026, optimistic about the approval of UHV superexpectations and the acceleration of investment in distribution networks

The Zhitong Finance App learned that CICC released a research report saying that the overall performance of the power equipment industry was steady and improving in 2026, prompting investors to focus on structural opportunities. In terms of traditional power grids, the “15th Five-Year Plan” new energy system clearly positions the power grid “adapts to a high proportion of new energy”, and the “15th Five-Year Plan” investment plan of the State Grid has been released, and grid investment can be expected for a long time. Furthermore, the pace of global AIDC infrastructure is accelerating, and demand for related power equipment is strong, and Chinese power equipment companies are expected to obtain orders with advantages such as short delivery cycles, high cost performance, and adequate after-sales service. Under the carbon peak target, new energy sources will continue to develop. We are optimistic that UHV will be approved in excess of expectations and that investment in distribution networks will accelerate.

The bank still believes that the global electricity cycle is beginning to emerge. The development of new power systems is a long-term, continuous process. The boom may last until 2030, while orders, revenue, and profits of major listed companies are still on a solid upward channel. After adjustments, current valuations have entered a historical underestimated range, and the sector has long-term investment value.

CICC's main views are as follows:

Main investment line 1: New energy sources will continue to develop under the carbon peak target. We are optimistic that UHV will exceed expectations and that investment in distribution networks will accelerate. The bank believes that during the “15th Five-Year Plan” period, domestic UHV projects are expected to be in the accelerated construction stage. The core logic will be upgraded from “achieving long-distance transmission of electricity” in the past to the ambitious goal of “supporting the transmission of large new energy bases, building a unified national electricity market, and improving grid resilience.” However, the “15th Five-Year Plan” new energy installations are still expected to continue to develop under the carbon peak target, and the demand for grid-connected connections further requires a continued increase in investment in power grids. Whether it is centralized large-scale base development or distributed energy connections, there is still plenty of room for investment in UHV main networks and distribution grids.

Main investment line 2: Overseas electricity investment cycle is long, and domestic combustion engine+power transmission and transformation manufacturers are going overseas at an accelerated pace. On the one hand, the bank believes that under the reform of the heavy load grid-connected mechanism, more emphasis will be placed on the full life cycle value of data centers for on-site power generation, etc.; on the other hand, changes such as overseas power grid capital expenditure plans, power generation side energy transformation, old power grid upgrading, and electricity side data centers continue to drive global power grid investment into a long cycle, driving strong demand for power equipment. Foreign manufacturers continue to maintain a high level of supply bottlenecks in the short term, and the supply bottleneck is difficult to resolve in the short term. Chinese companies have ushered in historic opportunities to go overseas, and their share in overseas markets is still increasing significantly. space.

Risk warning: grid investment falls short of expectations; new energy installations fall short of expectations; risk of changes in international trade policies and exchange rate fluctuations.