Energy Transition & Power Demand▲
China’s 15th Five-Year Plan targets over 5 trillion yuan for new-type power grid, A-share grid equipment sector surges across the board
The central government has explicitly designated the new-type power grid as a key investment direction under the 15th Five-Year Plan, with planned investment exceeding 5 trillion yuan. Of this, State Grid is expected to invest 4 trillion yuan, an increase of about 40 percent compared with the 14th Five-Year Plan period. Catalysed by the policy, A-share grid-related sectors surged across the board on 3 August, with the grid equipment index showing active performance. Jiuxing Electric led the gains with a 20 percent rise, while Baili Electric, Great Wall Electric, and Huijintong were among multiple stocks that hit their daily limit up. Grid equipment companies that have already disclosed interim earnings forecasts showed clear divergence. Dalian Insulator, Fanfan Steel Structure, and Baobian Electric benefited from full order books for ultra-high-voltage projects and achieved high growth, whereas Sanxing Electric and Great Wall Electric were dragged down by factors such as high raw material prices, declining bidding prices, and exchange losses, resulting in profit declines or even losses. Institutions’ analysis points out that there is typically a six- to nine-month time lag from grid investment tenders to revenue recognition. Ultra-high-voltage, distribution equipment, new-type energy storage, as well as digital and intelligent infrastructure such as smart grids and computing-power coordination, are expected to benefit from this round of policy dividends.