Industry and Company Overview * Industry: Global power grid investment and power equipment export * Company: Not specified, but focus on Chinese companies in the power equipment sector Key Points 1. Global Grid Investment Growth: The global grid investment is experiencing a high growth trend, expected to double by 2030 to reach 600 billion USD. Developed economies and China account for 80% of the share, and will continue to lead the investment, but will gradually shift to developing countries. In the long term, from 2041 to 2050, the average investment demand will reach 870 billion USD, indicating a long-term, high-growth sub-industry. [1] 2. Driving Factors for Power Equipment Export: The main driving factors include global power demand growth, equipment replacement needs, and new energy grid construction. Factors such as global industrialization, urbanization, and the AI revolution have driven power demand growth. About 40% of the equipment in the distribution networks of developed economies has been in use for more than 40 years and needs to be replaced. At the same time, global energy transformation has become a consensus, and the number of renewable energy projects is also increasing, driving the huge demand for advanced power equipment. [3] 3. Challenges and Opportunities for Chinese Companies: Chinese companies face challenges such as product certification, channel construction, and sales talent. Different countries have different customized requirements for products, requiring investment in research and development and certification. Channel construction requires building a wide and stable customer relationship network due to the large differences in market demand. Sales personnel need to have language skills and understand the culture and international bidding rules of various countries. However, these challenges also bring opportunities. For example, through dealer cooperation, it can quickly enter the market, while direct sales can improve customer stickiness and obtain higher profit margins. In addition, through overseas mergers and acquisitions, it can quickly gain mature supply chain and sales channels, while greenfield investment and construction can independently choose investment strategies and reduce the restrictions of industrial protection policies. [4] 4. Transformer Market Outlook: The transformer market has a promising outlook, with the global market size expected to grow from 420 billion USD in 2023 to 800 billion USD by 2032. The North American and European markets have particularly bright growth rates, with annual compound growth rates of 7.8% and 8.7%, respectively, both exceeding the global average. At the same time, China's transformer export revenue reached 370 billion RMB in 2023, with a compound annual growth rate of 18% from 2021 to 2023. In the first eight months of 2024, China's transformer export revenue was close to 28.7 billion RMB, an increase of 28% year-on-year. [5] 5. Smart Meter Market Outlook: The smart meter market also has significant growth potential. From 2023 to 2032, the field is expected to achieve a compound annual growth rate of more than 9%. Currently, China's smart meter export scale has exceeded 10 billion RMB, and the "Belt and Road" region has become its important target area for in-depth layout. [6] 6. Core Competitive Advantages of Chinese Companies: Chinese companies have core competitive advantages in international markets, mainly reflected in price, manufacturing capacity, and service quality. First, China has a complete and strong industrial chain, which makes the manufacturing cost relatively low, thus having a significant price advantage. Second, Chinese companies have strong manufacturing capacity and can deliver products on time and provide high-quality services. Finally, on the technical level, some of China's products have reached or even exceeded international levels. In addition, through a package of solutions under the "Belt and Road" initiative, China's companies provide comprehensive support for overseas owners, which also enhances their competitiveness in the international market. [7] 7. Paths for Power Equipment Export: There are mainly four paths for power equipment export: dealer cooperation, direct sales, overseas mergers and acquisitions, and greenfield investment and construction. Each has its own advantages and disadvantages. Most Chinese manufacturers adopt a diversified strategy to deal with the complex environment of different countries and regions and achieve a wider and deeper overseas layout. [8] 8. Performance of Transformer Export Market: The overall performance of the transformer export market is very good, although there are fluctuations. In terms of regions and countries, Asia and Europe are the main markets for transformer exports. Europe's year-on-year growth rate was 54%, and North America's growth rate was 40%, both higher than other regions. Asia and Europe accounted for a high proportion in exports, respectively, 48% and 21%. South America is also strong, with a North American share of 11%. As of 2024, the export unit price of transformers has been rising, mainly due to changes in product structure and supply and demand tension. In transformer products, the export cost of liquid transformers is higher. In 2023, its share was close to 207 billion yuan, accounting for more than other types, and its annual compound growth rate from 2021 to 2023 reached 64%. In the first eight months of this year, 174 billion yuan has been exported, an increase of 57% year-on-year, almost reaching the level of the whole year of 2023. [9] 9. Growth of Major Markets: Asia is the main market for VIP exports, and the growth rates of the US and Europe are also significant. From the data in the first half of the year, the growth rates of Europe and America were 220% and 184%, respectively, which were very impressive. The United States is an important market, second only to Pakistan, with a compound annual growth rate of 276% from 2021 to 2023. The prospects for the export of US distribution transformers are promising. [10] 10. Outstanding Companies in the Overseas Market: Many excellent companies have performed well in the overseas market, such as Special Electric, China Electromechanical, Resource Electric, Group Technology, Product Equipment, and Hongkou Network. Most of these companies have gradually increased their overseas revenue share and the industry gross profit margin has shown an upward trend, higher than that at home. For example, Real Estate Technology established a subsidiary in the United States and produced and provided services to the US market in other modes in Mexico. [11] 11. Development Trends in the Electricity Meter Field: The demand for electricity meters shows a trend of differentiation. In terms of retail electricity meter scale, it has increased from nearly 200 billion yuan two years ago to about 460 billion yuan in 2014, with a compound annual growth rate of about 12%. In Latin America, its compound annual growth rate can reach about 12%, higher than other regions such as Europe (8.5%) and other countries (6%-8%). Overall, China's smart meters are mainly exported to Asia, Europe, and Africa, with an international export of 74 billion yuan in the first eight months of this year, an increase of 10% year-on-year. [12] 12. Power Equipment Companies to Watch: Haisong, Samsung, Bird and Ram, and other companies have achieved power equipment exports. Among them, New Power Technology has achieved a transformation from metering to a solution provider. In the first half of this year, its overseas business bidding amount was about 300 million yuan, accounting for a market share of 2.44%, ranking seventh. The total bidding amount was 2.5 billion yuan, accounting for a market share of 5.8%. In addition, there is Samsung Medical, which is the domestic leader in intelligent distribution and utilization and has offices in 31 provinces and deeply cultivates the global market. [13] 13. Progress in Ultra-high Voltage Direct Current Converter Transformers: Although the market below 210 kV has basically achieved localization, ultra-high voltage direct current converter transformers still rely on foreign countries. However, the company has made significant progress in this area, such as successfully delivering the first ultra-high voltage instantaneous switch and signing batch sales contracts for ultra-high voltage products. In June this year, the delivery was completed, and it is expected to fully benefit from China's ultra-high-speed expected logic. [14] 14. Company Performance and Future Outlook: Many companies have excellent performance. For example, Group Technology's overseas sales revenue in the first half of this year was nearly 800 million yuan, an increase of 49%; New Power's revenue was 2.3 billion yuan, an increase of 20%; and Samsung Medical's revenue was 1.2 billion yuan, an increase of 16%. These companies not only expand new growth curves through energy storage and digital projects, but also actively layout international markets to improve profitability and competitiveness. However, it is noted that if grid investment falls short of expectations, it will trigger intensified development competition and other risks. [15]
全球电网投资高增-电力设备出海可期
电力圆桌·2024-10-10 06:56