Industrial control: the overall demand margin is slowing down, and attention is paid to structural opportunities such as the demand for energy-saving transformation under the advanced manufacturing sector and the “double carbon” policy. After the epidemic in 2020, the industrial control industry returned to recovery. After nearly a year and a half upward cycle, the year-on-year growth rate of 2021q2-q4 demand fell back to a moderate growth. The year-on-year growth rate of Q2 / q3oem market was 28% / 21% respectively. We expect that 2021q4 will increase by about 10% at the same time. Specifically: 1) by market, the overall year-on-year growth rate of 2021q3oem market and project-based market was + 21.2% / 1.5%, down month on month. 2) In terms of downstream, there is structural differentiation: advanced manufacturing sectors such as industrial Siasun Robot&Automation Co.Ltd(300024) / semiconductor / lithium battery have exceeded 30% year-on-year growth for three consecutive quarters (up to 2021q3), and traditional industries are generally under pressure. 3) In terms of products, the year-on-year growth rate of low-voltage frequency conversion, AC servo and small PLC is 10% / 28% / 20%. In 2021, the industry increased by 15-20% at the same time, and the overall demand of the industry slowed down in 2022, but the demand for capital expenditure in lithium battery, photovoltaic equipment, logistics, electronics and other industries related to “double carbon” is still strong. We expect the industry to increase by 5% – 15% at the same time, and the second half of 2022 is expected to be better than the first half. Domestic industrial control leaders and second tier leaders are mostly distributed with advanced manufacturing and other boom sectors, which continue to increase their proportion in the business structure. With the ability of product cost performance and rapid response delivery, they continue to replace foreign capital, and are expected to continue to benefit in 2022. Key recommendations: Shenzhen Inovance Technology Co.Ltd(300124) , China Leadshine Technology Co.Ltd(002979) , recommendations: Zhejiang Supcon Technology Co.Ltd(688777) , Shenzhen Megmeet Electrical Co.Ltd(002851) , Wuxi Xinje Electric Co.Ltd(603416) .
Relay: high voltage DC relay increases, and the demand of traditional industries is upward. There is a large market space for high-voltage DC relays. We estimate that the global market space will be 16.2 billion yuan in 2025 (about 2 billion yuan in 2020 +), which is expected to continue to increase rapidly. The production and sales of short-term downstream electric vehicles are booming. The shipment volume of Hongfa high-voltage DC relays, the leader of 2021q1-3, has doubled year-on-year. The number of benchmark customers such as MEB previously designated has increased, and the shipment of Tesla project has also increased significantly, In 2021, it also continued to obtain new project points. Relay and other major downstream industries, such as home appliances, fuel vehicles, communications, etc., are booming in 2021. In particular, the traditional automobile sector is accelerating to replace foreign capital and has abundant orders. After the capacity bottleneck is solved in 2021q3, the growth is expected to continue to accelerate. Key recommendations: Hongfa Technology Co.Ltd(600885) .
Power grid: under the background of double carbon, the new power system is expected to usher in structural opportunities, and the directions of UHV, intelligent distribution network and energy storage are expected to benefit. In terms of total investment, we expect the total investment of the State Grid to increase steadily during the 14th Five Year Plan period (an annual average of 470-500 billion yuan). However, under the background of large-scale access to new energy, changes in load structure, large penetration of power electronic equipment and other problems, we believe that the focus of power grid investment will be on grid construction (mainly UHV DC) Distribution network intelligence (especially the intelligent scheme for distributed power generation and new load access), pumped storage, digitization (dispatching system, ICT), etc. Key recommendations: Nari Technology Co.Ltd(600406) , Sieyuan Electric Co.Ltd(002028) , Hainan Jinpan Smart Technology Co.Ltd(688676) , attention: Beijing Sifang Automation Co.Ltd(601126) , Hangzhou Sunrise Technology Co.Ltd(300360) , Acrel Co.Ltd(300286) , Changgao Electric Group Co.Ltd(002452) , Chang Lan Electric Technology Co.Ltd(002879) , Zhiyang Innovation Technology Co.Ltd(688191) , Yijiahe Technology Co.Ltd(603666) , Shanghai Holystar Information Technology Co.Ltd(688330) , etc.
Low voltage electrical appliances: the stock focuses on the substitution of domestic capital, and the increment also depends on the new power system. The prosperity of low-voltage electrical appliance stock industry is under pressure, and pay attention to the growth brought by domestic capital substitution and low-end integration; The rapid development of new energy and the intelligent transformation of distribution network have brought incremental opportunities for low-voltage appliances. Key recommendations: Zhejiang Chint Electrics Co.Ltd(601877) , Zhejiang Tengen Electrics Co.Ltd(605066) .
Risk tip: the power grid investment is less than expected, the macroeconomic boom is declining, and the policy recommendation is less than expected.
