May Distribution, UHV, PV Report

Distribution industry - boom level can maintain a high level

“Distribution equipment”: This area not only possesses certain technical barriers and qualification barriers, but also has a large number of projects outside the power system based on the orders of the grid companies. This includes various venues, railways, airports, stations, and commercial facilities. With real estate, etc., the situation of centralized tendering is less, and excellent companies can win through product quality, technical ability, service efficiency, and excellent sales ability without having to use price as the main competitive means. A share company Xinlong Electric, Senyuan Electric and other listed companies accounted for 6-80% of the total sales revenue outside of the power system, which deserves attention.

UHV - Entering a period of rapid development

The policy environment has been tilted toward the side of “supporting UHV construction.” From this perspective, the investment decisions of A-shares have been considered. The safety, economics, and technical feasibility of UHV issues are not “problems”. After the two conferences, the reform of the ministry led to the formal abolition of the Electricity Regulatory Commission and its transfer to the Energy Bureau. The Energy Bureau was administered by the National Development and Reform Commission and the U.S. high-pressure approval process was more smooth. The subsequent approval of each UHV line and the acquisition of roads will be a catalyst for the formation of share prices.

China Xidian has fully benefited from the exchange of ultra-high voltage and direct current UHV construction. The products cover many key equipment such as transformers, reactors, GIS, and converter valves. In addition, Pinggao Electric has a high market share and high elasticity in UHV GIS market. It is also worth focusing on.

Photovoltaic industry - or slowly out of the deep valley

Compared with the "wonning and drinking" index of shipments, the gross profit margin index is more indicative of the recovery of the industry. The gross profit margins of the two companies with industry representative "turned positive" in the first quarter, indicating that the photovoltaic industry has The worst time has been left behind, but the speed of the recovery process remains to be seen.

In the past year, global PV decapacity accelerated and SMEs withdrew significantly. We expect that the global component capacity will be lower than 45G in 2013, and the demand will be higher than 35G. The contradiction between supply and demand will be greatly eased, and it will fundamentally support the gradual increase in the gross profit margin of related companies. Earnings We believe that at least until 2014.

If the situation of the EU with heavy taxation and domestic market salvation really occurs, the benefits of the inverter and power plant construction will be higher than those of silicon wafers and components, solar power (inverter leader), comprehensive stock and Hairun photovoltaic (power station) Leading) is worth paying attention to. If we take into account China's polysilicon prices caused by countermeasures against the EU polysilicon, then TBEA (polysilicon leader) will take the lead.

Share price catalyst: Sino-European photovoltaic trade friction eased, China's policy of expanding domestic demand support was introduced in succession, and US stocks PV companies exceeded their expectations in the quarterly report to announce the industrial risk factors: The EU’s anti-primary sanctions against China were heavy taxes, and domestic rescue policies were low.