In-Depth Analysis of the Impact of Power Grid Investment on Order Growth for UHV Equipment Manufacturers

Based on the above in-depth research, I now present to you a

:

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According to the latest information released by State Grid Corporation of China (SGCC), the company’s fixed-asset investment is expected to reach

during the 15th Five-Year Plan period (2025-2030), representing a 40% increase compared to the 14th Five-Year Plan period, with an average annual investment of approximately 800 billion yuan [1]. This scale far exceeds historical levels:

Period	Power Grid Investment Scale	YoY Growth Rate	Remarks
2022	509.4 billion yuan	First time exceeding 500 billion yuan	—
2023	538.1 billion yuan	+5.6%	—
2024	608.3 billion yuan	+13.0%	First time exceeding 600 billion yuan
2025	>650 billion yuan	Estimated +7%	First time exceeding 650 billion yuan
15th Five-Year Plan	4,000 billion yuan	40% cumulative growth over five years	800 billion yuan annual average

In 2025, SGCC’s bidding volume for power transmission and transformation equipment reached

, a year-on-year increase of 25.3%, of which transformers accounted for 21% and power cables accounted for 17% [1]. The bidding volume for distribution network areas and joint bidding reached , with 10kV high-voltage power cables and low-voltage power cables accounting for 34% and 18% respectively [1].

SGCC clearly stated that during the 15th Five-Year Plan period, it will accelerate the construction of UHV DC transmission channels, and cross-regional and inter-provincial transmission capacity will

compared to the end of the 14th Five-Year Plan period [2]. TBEA (600089.SS), a leading transformer manufacturer, stated at its performance briefing that it is expected that 4-5 new UHV DC projects will commence construction annually in China in the future, and there may be more in individual years [1].

As of the end of 2025, SGCC has completed a total of

, with cross-provincial and cross-regional transmission capacity reaching 370 million kW [1]. According to the Guiding Opinions on Promoting High-Quality Development of Power Grids, the scale of “West-East Power Transmission” will exceed 420 million kW by 2030, with an additional inter-provincial power mutual aid capacity of approximately 40 million kW [2].

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— Global Leader in UHV Transformers

• Estimated Order Scale
  : Approximately 80 billion yuan in outstanding orders [3]
• 2025 Bidding Performance
  : Won 4.5 billion yuan in orders in SGCC’s 85th and 87th procurement batches, accounting for 23% of the total procurement value, ranking first [4]
• Overseas Breakthrough
  : Won a localized procurement project for UHV, high-voltage power transformers and reactors from Saudi Electricity Company, with a value of approximately
  16.4 billion yuan
  , to be implemented over 7 years [3]
• First Half of 2025
  : Revenue growth rate of electrical equipment reached
  29.66%
  [3]
• Financial Performance
  : 2024 revenue reached 97.87 billion yuan; net profit attributable to parent company in the first three quarters of 2025 increased by 28% year-on-year [1]

— UHV “National Team”

• Estimated Order Scale
  : Cumulative winning bid value in 2025 reached
  8.393 billion yuan
  [5]
• Winning Bid for Tibet-Guangdong Project
  : As the world’s largest flexible DC transmission project, the winning bid value was
  1.005 billion yuan
  , surpassing NARI Technology and Baobian Electric [5]
• Market Share
  : Ranked first in the industry (approximately 20%) in SGCC’s UHV equipment bidding from 2023 to 2024, and ranked first in overall transmission and transformation equipment bidding (approximately 8-9%) [5]
• First Three Quarters of 2025
  : Net profit attributable to parent company increased by 20% year-on-year [1]

— All-Round Leader in the Power Grid Industry

• Estimated Order Scale
  : Orders in 2025 have exceeded
  50 billion yuan
  [4]
• Core Advantages
  : Market share of UHV DC control and protection systems exceeds 74%, and market share of dispatching systems reaches 75% [4]
• Financial Performance
  : Q3 2025 revenue reached 1.433 billion US dollars, with a net profit margin of 12.55% [6]
• Technology Layout
  : Deployed AI algorithm prediction and virtual power plant technologies; compound annual growth rate of net profit is expected to be 11% from 2024 to 2030 [4]

— King of UHV GIS Switchgear

• Core Advantages
  : Market share of UHV GIS switchgear reaches 44%, won bids for
  45 national-level UHV lines
  [4]
• Financial Performance
  : Net profit attributable to parent company in the first three quarters of 2025 increased by 73% year-on-year [1], with ROE reaching 10.50% [7]

— Leader in UHV Converter Valves

• Core Advantages
  : Market share of UHV converter valves exceeds 37%, with more than half of the high-end market share [4]
• Business Proportion
  : Revenue from UHV business accounts for 60% [4]
• Technological Leadership
  : Participated in the Zhangbei “Source-Grid-Load-Storage” demonstration project, and jointly developed smart string inverters with Huawei [4]

Equipment Category	Main Beneficiary Companies	Market Share	Order Characteristics
Transformers	TBEA, XD Electric, Baobian Electric	TBEA >40%	A single UHV line requires 20-30 transformers, with each unit valued at tens of millions to hundreds of millions of yuan
Converter Valves	NARI Technology, XJ Electric, XD Electric	NARI Technology >74%	Core equipment for UHV DC, accounts for the highest proportion of single project value
GIS Switchgear	Pinggao Electric, XD Electric	Pinggao Electric 44%	Core equipment for UHV AC, high technical barriers
Capacitors	XD Electric, Hitachi Energy	—	Ensures stable current operation
Protection Equipment	NARI Relays, Sifang Electric	NARI Relays >30%	Core for safe power grid operation

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Currently, the contradiction between the rapid growth of new energy installed capacity and the lagging power grid consumption capacity is becoming increasingly prominent. The problem of “able to generate but unable to transmit” in the northwest region has led to persistently high wind and solar curtailment rates [1]. The National Development and Reform Commission clearly stated that by 2030, it is necessary to support new energy power generation accounting for 30% of total power generation, and the capacity to accommodate distributed new energy should reach 90 million kW [2]. This directly drives the acceleration of UHV construction:

• “Desert, Gobi, Barren Land” Large Bases
  : Special transmission channels need to be constructed
• Southwest Hydropower Development
  : Such as the Southeast Tibet-Guangdong-Hong Kong-Macao Greater Bay Area UHV Project [8]
• Distributed New Energy Grid Connection
  : Surging demand for distribution grid transformation

Target Field	Incremental Demand	Corresponding Equipment Market
30% increase in cross-regional transmission capacity	Dozens of UHV lines	UHV equipment market scale is expected to reach 680 billion yuan [4]
Grid connection of 35 million charging facilities	Distribution grid intelligent transformation	Over 100 billion yuan in new distribution grid equipment market
50GW of new energy storage installed capacity	Energy storage supporting equipment	Strong demand for energy storage transformers and converters
Overseas power grid upgrades	European and Southeast Asian markets	Overseas revenue growth rate exceeds 60% [4]

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According to TBEA’s 2025 interim report data, the company’s transmission and transformation business signed approximately

in the domestic market and in the international market [3]. Combined with the 16.4 billion yuan order from Saudi Arabia, it is conservatively estimated that the company’s outstanding orders exceed 80 billion yuan.

:

• Domestic UHV projects: 27.3 billion yuan
• Overseas projects (Saudi Arabia, etc.): 16.4 billion yuan + 1.12 billion US dollars
• New energy and supporting projects: Support stable earnings growth

:

• From 2020 to 2024, revenue excluding new energy and supporting projects increased from 32.484 billion yuan to 79.336 billion yuan, achieving
  doubled growth
  [3]
• Overseas business has grown rapidly; overseas transformer order growth rate reached 89% in the first half of 2025 [9]

2025 is a bumper year for XD Electric’s orders. The company won a 1.005 billion yuan bid for the Tibet-Guangdong Project, and together with other projects during the year, it has accumulated

[5].

:

• Hybrid converter valves: Adopt fully domestic IGCT devices, with higher power density and lower losses than mainstream IGBT solutions
• World’s largest capacity flexible DC transformer: Overcome world-class difficulties such as large-capacity leakage magnetic control
• ±800kV flexible DC wall bushing: Break long-term foreign monopoly and fill domestic gaps

:

• Comprehensive gross profit margin steadily increased from 16.43% in 2022 to
  22.14%
  in the third quarter of 2025 [5]
• R&D expense ratio (4.07%) is significantly higher than peers such as Baobian Electric and TBEA [5]

As a close affiliate of SGCC, NARI Technology has a market share of over 74% in UHV DC control and protection systems, and a market share of 75% in dispatching systems [4]. The company’s orders in 2025 have exceeded

, and it is deeply involved in all major domestic UHV projects.

:

• Full industry chain coverage: All links of power generation, transmission, transformation, distribution, and consumption
• High technical barriers: Leading AI dispatching systems and smart substation solutions
• Strong earnings stability: Net profit margin remains at 12.55%, with ROE reaching 16.21% [6]

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With the grid connection of distributed energy and 35 million charging facilities, distribution grid transformation has become a rigid demand. In 2025, the bidding volume for distribution network areas and joint bidding reached

[1], including:

Distribution Grid Equipment	Bidding Proportion	Main Beneficiary Enterprises
10kV High-Voltage Power Cable	34%	Orient Cable, TBEA
Low-Voltage Power Cable	18%	Orient Cable, Han Cable
Distribution Grid Automation Equipment	—	NARI Technology, Orient Electronics, Sifang Electric

:

• Orient Electronics (000682)
  : Leader in distribution grid automation, undertook the smart grid project in Huangdao District, Qingdao, increasing PV consumption rate to 99.2% [4]
• Sifang Electric (601126)
  : Distribution grid self-healing control technology improves fault handling efficiency by 8 times; smart distribution orders increased by 40% in 2025 [9]
• NARI Relays (600268)
  : Won 2.35 billion yuan in bids for UHV expansion and digital substation projects in 2024, with production scheduled through 2027 [4]

SGCC launched a “AI +” special action, bringing opportunities to tracks such as power grid automation, virtual power plants, and digital twins:

Segment	Growth Logic	Representative Enterprises
Virtual Power Plants	Aggregated load of 3.2GW, adjustable capacity of 380MW	NARI Relays
Smart Substations	Digital substations account for more than half of new projects for the first time	NARI Technology, Sifang Electric
Power Robots	Inspection robot market share exceeds 60%	Yijiahe

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Benefiting from European power grid upgrades and strong demand for new energy infrastructure in Southeast Asia, overseas business of Chinese UHV equipment manufacturers has grown rapidly:

Enterprise	Overseas Business Highlights	Growth Rate
TBEA	16.4 billion yuan order from Saudi Arabia, EU CE and North American UL certifications	Overseas order growth rate >50%
XD Electric	45% export growth rate in the European market, won bid for Saudi NEOM project	Overseas revenue accounts for 25%
Sunny Worldwide Electric	89% growth rate in overseas transformer orders, entered high-end European and American markets	Overseas revenue growth rate 89%
Pinggao Electric	Expands with SGCC’s overseas projects	Significant growth in overseas revenue

Currently, there is a structural shortage of global power grid equipment, and leading enterprises will face a growth trend of

in the coming years [2]. Main driving factors:

• Aging Power Grids in Europe and the US
  : Need large-scale renewal and transformation
• Surging Power Demand for AI Data Centers
  : Surging demand for high-voltage power transmission and distribution equipment
• Emerging Markets in Southeast Asia
  : Strong demand for new energy infrastructure

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The order cycle for power grid investment is clear, from bidding to delivery to revenue recognition, and leading enterprises have extremely high order visibility:

Enterprise	Order Visibility	Capacity Expansion
NARI Relays	Production scheduled through 2027	Capacity doubled after the Nanjing smart factory was put into operation
TBEA	>80 billion yuan in outstanding orders	Continued capacity expansion
XD Electric	8.3 billion yuan in orders in 2025	10.4 billion yuan in monetary funds to ensure delivery

In the first three quarters of 2025, the performance of major equipment manufacturers has reflected the effect of order growth:

Enterprise	YoY Growth Rate of Net Profit Attributable to Parent Company	Characteristics
TBEA	+28%	Transmission and transformation business as a stable support
XD Electric	+20%	Flexible DC products improve gross profit
Baobian Electric	+73%	Full order book
Pinggao Electric	+73%	Strong demand for GIS switchgear

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Target	Rationale	Order/Earnings Highlights
TBEA	King of Bids + Energy Carrier	80 billion yuan in orders, market share >40%, 16.4 billion yuan large order from Saudi Arabia
XD Electric	Full Industry Chain Support	8.3 billion yuan in orders, leading flexible DC technology, great potential for valuation recovery
NARI Technology	Top Player in Power Grid Automation	50 billion yuan in orders, ROE 16.21%, stable earnings growth
Pinggao Electric	Leader in GIS Switchgear	45 UHV lines, 73% earnings growth
XJ Electric	Leader in Converter Valves	37% market share, 60% of revenue from UHV business

1. Bidding pace falls short of expectations
   : Approval and commencement progress of UHV projects may be affected by policies
2. Fluctuations in raw material prices
   : Prices of raw materials such as copper and steel affect equipment gross profit margins
3. Intensified competition
   : New entrants may impact the existing market structure
4. Overseas geopolitical risks
   : Overseas business expansion faces uncertainties

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[1] Yicai Global - SGCC Releases Record 4 Trillion Yuan Investment Plan (https://www.9fzt.com/9fztgw_1_top/f02c88d2ab8b515cfa64eabb6f1b4b48.html)

[2] Shanghai Securities News - SGCC Increases Investment to 4 Trillion Yuan for the 15th Five-Year Plan Period (https://finance.eastmoney.com/a/202601163620923270.html)

[3] Eastmoney - TBEA’s Hidden 80 Billion Yuan in Orders (https://caifuhao.eastmoney.com/news/20260116211824306126770)

[4] Eastmoney - Beneficiary Analysis of SGCC’s 4 Trillion Yuan New Power Facility Investment Industry Chain (https://caifuhao.eastmoney.com/news/20260115230356540317210)

[5] Securities Times Network - XD Electric Secures 8.3 Billion Yuan in Orders (https://q.stock.sohu.com/cn/news.html?textId=961734617)

[6] Jinling AI - NARI Technology Company Profile Data (600406.SS)

[7] Jinling AI - Pinggao Electric Company Profile Data (600312.SS)

[8] Securities Times - XD Electric Investor Q&A (https://www.stcn.com/quotes/index/sh601179.html)

[9] Eastmoney - Positive News Surprise! UHV Power Grid Equipment Faces Development Opportunities (https://caifuhao.eastmoney.com/news/20260116061703114688750)