China Securities Co.,Ltd.: New energy industry divergence hinges on prosperity; market expectations for 2027 are already at a low level.

China Securities Co.,Ltd. released a research report stating that in 2026, with the overall acceleration of energy storage and AIDC, the power equipment and new energy industry has entered a new upward cycle and this has been reflected in performance; looking ahead to 2027, the market is already at a relatively low expectation, while the high prosperity of new energy driven by high oil prices and AI will continue: Driven by AI demand and soaring oil prices, global power grids, especially those in Europe and the US, will continue to increase investment. The aforementioned adjustment costs and grid renovation costs will further push up electricity prices, opening up long-term demand space for energy storage. AI will drive an increase in global electricity consumption growth, and the importance of low-carbon high-density power sources (offshore wind, SOFC, nuclear power, gas turbines) will also rise, with data center power supply models shifting toward high voltage. Under high overseas oil and gas prices, backup power demand and economic requirements will significantly increase substitution demand for new energy vehicles, energy storage, and other alternatives to old energy. China Securities Co.,Ltd.'s main views are as follows: Looking ahead to 2027, the market's current pricing for new energy already incorporates relatively pessimistic growth expectations, while the acceleration of generation-side construction driven by sustained high oil prices and AI will still maintain high prosperity. It is expected that global and domestic new energy installed capacity will continue to rise. 1. Driven by AI demand and high oil and gas prices, European and US power grids will continue to increase investment, and new energy will usher in sustained volume growth by virtue of its self-controllable advantages. Currently, Europe and emerging markets are seeing accelerated grid construction amid rigid demand and supply constrained by high gas and oil prices and unstable power supply. In 2027, global PV is expected to recover, and offshore wind will maintain high growth; in the US, under rapid growth in AI electricity consumption, the power supply gap will persist until 2028. 2. New energy will force a substantial increase in grid investment, and the long-term upward trend in electricity prices will open up long-term demand space for energy storage. Rising new energy penetration will force a steady increase in global grid investment, which will ultimately be reflected in higher end-use electricity costs, thereby driving long-term increases in end-user electricity prices. Global energy storage demand growth will enter a resonance phase and will also drive the lithium battery industry to maintain high growth. 3. High overseas oil and gas prices accelerate economic requirements. Anti-globalization and tight supply of energy resources strengthen power supply instability, bringing significantly higher backup power demand; under economic requirements, accelerated substitution of new energy vehicles, energy storage, and other alternatives for fuel vehicles, diesel generation, and the like. 4. AI drives a substantial increase in data center power density, making low-carbon high-density power sources essential and scarce capacity. At present, mainstream new energy power sources such as PV and onshore wind occupy relatively large land areas. In the future, high-density, low-cost power sources will gradually scale up, including offshore wind, SOFC, gas turbines, nuclear power, and others. 5. High-reliability power sources are becoming a trend, triggering a new technology revolution. AI's high reliability and stability requirements for power sources will bring technological changes. On the one hand, AIDC power sources have higher efficiency and reliability requirements, and in the future SST combined with 800V HVDC will become the ultimate solution. On the other hand, energy storage provides capacity for AIDC, and future AIDC storage demand will also explode. From the perspective of the 2026 industry selection strategy, continuing to use the supply-demand growth gap and combining each industry's supply-demand ratio and marginal changes in competitive landscape to conduct comprehensive scoring across industries, AIDC, utility-scale storage, residential storage, some lithium battery materials, offshore wind, power equipment exports, and power equipment UHV score at the top and are recommended for key attention. Energy storage: Overseas utility-scale storage demand prosperity will continue to rise; residential storage & commercial and industrial storage are currently undervalued by the market Since 2026, global energy storage demand has maintained high growth of over 50% amid resonance, but domestic utility-scale storage slightly fell short of expectations under high expectations, mainly because narrowing peak-valley price spreads in the northwest region, rising system operation fees, and slower-than-expected implementation progress of capacity electricity prices in various provinces slowed actual project implementation progress. Looking ahead to 2027, global newly added energy storage installed capacity is expected to be 616GWh, +31% YoY. Among this, domestically, with lithium carbonate price declines, demand growth in North China, Northeast China, South China and other regions, and the drive from new scenarios such as computing power coordination, the bank expects domestic energy storage in 2027 to be 290GWh, +21% YoY; overseas utility-scale storage demand prosperity will continue to rise, with overseas energy storage installed demand in 2027 expected at 326GWh, +42% YoY. Multiple factors are expected to drive overseas energy storage growth beyond expectations: intensifying electricity price volatility and higher curtailment rates; a marked increase in the center of oil and gas energy and electricity prices; growth in AI computing power and industrial electricity demand; system cost reductions improving project returns. In terms of targets, Sungrow Power Supply, Beijing HyperStrong Technology, and Ningbo Deye Technology Corporation are recommended; among other integrators, attention is suggested to CSI Solar Co., Ltd. and others. Lithium batteries: Demand remains the core contradiction; excessively pessimistic market pricing will see expectation-gap correction The bank believes that under a neutral expectation for next year, a growth rate of 28%+ is expected to be achieved. Its certainty mainly comes from: a low base for domestic vehicles and a recovery expected as the halved purchase tax policy for electric vehicles exits in 2028; continued steady growth in commercial vehicles and exports; high overseas energy storage expectations offsetting low domestic utility-scale storage expectations; rapid scaling in pan-commercial applications (ships, construction machinery, etc.). Anchored on a 2027 lithium battery demand growth rate of 21%-29%, among midstream segments copper foil has the strongest supply-demand tightness and sustainability, with supply growth of 15%, and capacity utilization is expected to continue rising YoY; next are wet-process separators and aluminum foil, with supply growth of 23%/25%. Investment recommendations: From the perspective of competitiveness and industry landscape, batteries remain the best midstream segment, and Contemporary Amperex Technology after adjustment is already at a historically low valuation; from a supply-demand perspective, among midstream segments copper foil has the strongest supply-demand tightness and sustainability, followed by separators and aluminum foil. In sodium batteries, large-scale energy storage will become the first commercialization battlefield for sodium batteries, occupying part of the power market share due to advantages in cost + low-temperature performance + safety. Sodium battery demand is expected to reach 9GWh in 2026, including 4GWh of energy storage demand and 2.5GWh of power demand; by 2030, sodium battery demand could reach 492GWh, including 323GWh of energy storage demand and 153GWh of power demand; in solid-state batteries, battery makers generally expect small-batch production or demonstration installation in 2027, pilot lines are transitioning from hundred-MWh to GWh level, technology routes are gradually converging toward the sulfide route, and oxide is the main route in the semi-solid transition stage. Targets recommended include Contemporary Amperex Technology, Eve Energy Co.,Ltd., Jiujiang Defu Technology, Zhejiang Hailiang, Guangdong Jiayuan Technology, Yunnan Energy New Material, Shenzhen Senior Technology Material, Jiangsu Dingsheng New Materials Joint-Stock, Shijiazhuang Shangtai Technology, and others. Power equipment: Focus on the three main lines of high voltage + exports + AIDC High-voltage prosperity is being realized as expected: Q3 maintained relatively high realization, UHV tender amounts have exceeded the full year of 2025, and strong certainty advantages have emerged. In 26Q3, domestic high-voltage equipment deliveries advanced steadily. For example, Henan Pinggao Electric, China XD Electric, TBEA Co., Ltd. and other high-voltage equipment deliveries continued to ramp up volume and profit. It is expected that under the advancement of new line approvals + new batches of UHV tenders, market confidence is expected to continue improving. Exports combine high prosperity + strong fundamentals over the long term. From January to September 2026, transformer exports grew 25%, continuing relatively high growth, and prosperity remains, but short-term performance is affected by foreign exchange and impairments, and recent North American bans have increased uncertainty. AIDC demand prosperity is being realized, with leading companies continuing to secure relatively good orders in the data center field in 26Q3, and 800V iteration gradually advancing industrial implementation; implementation progress will become an important catalyst. Recommended attention: UHV names Henan Pinggao Electric, Xj Electric Co.,ltd., NARI Technology, China XD Electric, TBEA Co., Ltd., etc.; export chain North America line Sieyuan Electric, Huaming Power Equipment, Hainan Jinpan Smart Technology, Jiangsu Shemar Electric; Middle East and North America Qingdao TGOOD Electric, TBEA Co., Ltd., Eaglerise Electric & Electronic, etc. For the AIDC chain, attention is suggested to leading companies Dongfang Electric Corporation, Beijing Sifang Automation, Hainan Jinpan Smart Technology, Sungrow Power Supply, etc. Wind power: Offshore wind has the better growth rate; share price recovery requires earnings and order realization Domestic and overseas wind power installation demand is upward over the medium and long term. Domestic wind power installations are generally stable in the short term. From January to September 2026, newly added installed capacity was 60.66GW, down 0.7% YoY. From January to October 2026, domestic new wind turbine tenders were 89.29GW, up 4% YoY; domestic newly added wind power installed capacity is expected to be about 116.5/117GW in 2026/2027 respectively; domestic offshore wind is affected by project approvals, and 2027 installations face downside risk, but tenders are expected to improve marginally. Looking ahead to the "15th Five-Year Plan", domestic average annual newly added installed capacity is expected to reach about 126GW, with the industry maintaining slight annual growth; domestic and overseas offshore wind markets remain the fastest-growing markets over the medium and long term, with a CAGR expectation of over 20%; in addition, onshore wind demand in emerging markets is expected to grow relatively fast, with newly added installed capacity from 2025-2030 expected to achieve a CAGR of over 10%. In the first three quarters of 2026, capital expenditure of 22 A-share wind power sample companies grew 17.4% YoY, but the increment mainly came from three companies: Goldwind, Dajin, and Hengtong. Excluding these, capital expenditure of the remaining companies grew only 0.3%, and industry-wide capacity expansion remains relatively restrained. Currently recommended directions are wind turbine OEMs and exports (towers, submarine cables), with Dajin Heavy Industry strongly recommended. Attention is suggested to: Ningbo Orient Wires & Cables, Jiangsu Zhongtian Technology, Jiangsu Haili Wind Power Equipment Technology, Titan Wind Energy, TSP Wind Power Group; gross margins of wind turbine OEMs are expected to improve in 2027, and attention is suggested to: Goldwind Science & Technology, Windey Energy Technology Group, Sany Renewable Energy. PV: Demand expectations are recovering; bullish on BC and silver-free directions In 2026, PV installations in most global markets showed a YoY decline, with only India, Africa, and other emerging markets still showing 15%-20% growth. Currently, the factors determining PV installation demand are increasingly concentrated on "whether grid connection is possible, what the electricity price is, and the project IRR level." The role of module price declines in driving demand has weakened, and the importance of energy storage, grid construction, and policy stability has increased. In 2027, mechanism electricity price centers are expected to correct upward, and PV demand in western provinces is expected to resume growth. Global newly added PV installed capacity in 2027 is expected to be about 400GW, with YoY growth of about 6%. Supply remains excessive. The biggest change in anti-involution is that governance logic has shifted from "industry self-discipline in price and production control" to "legal constraints + cost accounting + administrative enforcement + standard elimination + market-based mergers and reorganizations." Bullish on leading companies in main materials and auxiliary materials, as well as industry new technology directions (BC, silver-free). Shanghai Aiko Solar Energy, Jinko Solar, LONGi Green Energy Technology, Hengdian Group DMEGC Magnetics, etc. are recommended. Siasun Robot&Automation: Physical AI advances industrial chain implementation; the industry enters the mass-production validation period Physical AI fills the last shortcoming, and 2026 enters the batch coupling period. The world model + VLA (vision-language-action) architecture is gradually becoming mainstream. Siasun Robot&Automation first "understands" physical laws in simulation, then generalizes to unseen real scenarios. The Optimus production line has started early production, with 10,000-20,000 Optimus units to be manufactured first in the short term for autonomous training, and external sales are expected by the end of 2027, by which time software and hardware issues will be thoroughly resolved. Domestic chain Unitree Technology and AgiBot Siasun Robot&Automation lead in mass-production progress, and follow-up progress in industrial scenario implementation needs attention. The bank expects global humanoid Siasun Robot&Automation shipments to exceed 100,000 units in 2027 and exceed 700,000 units in 2030, with a CAGR of about 90% from 2028-2030. Industry catalysts are the source of sector alpha, and thematic investment is switching to industrial trend investment. Reviewing the Siasun Robot&Automation sector over the past five years, the bank finds that factors triggering market moves include: low positioning (low crowding / clean chips), mass-production/order event-level catalysts that have not been front-run in pricing (T-chain mass-production guidance / brain breakthroughs / application scenario implementation), a mild macro environment (broad market / market style / whether there is sector capital siphoning). The large drawdown in Siasun Robot&Automation during the year with trading volume share at a historical low + Tesla V3 scheduled for year-end mass production + the AI computing power main line adjusting in late October. The Q4 catalyst calendar is dense (V3 mass-production launch, Optimus videos, GTC Berlin), and the bank believes this round of market movement is not yet over, with the height depending on the realization of T-chain mass production and product strength. Attention is suggested to Shenzhen Kedali Industry, a target with a stable main business and low Siasun Robot&Automation option value; core targets in dexterous hands and sensors Shenzhen Zhaowei Machinery & Electronics, Shanghai Moons'Electric, Orbbec, etc.; domestic chain volume realization targets Unitree Technology, Swancor Advanced Materials Co., Ltd., MINTH GROUP, Autel Intelligent Technology Corp.,Ltd.