The opportunities of Wind Power Equipment

Reprinted from: Sina Finance - CICC 2025 Outlook: Key Insights

We expect the Chinese wind power industry to reach a historic high in newly installed capacity by 2025. The new installation scale is likely to exceed twice the amount installed at the end of the previous five-year plan (2020). In particular, offshore wind power is expected to notably end the relatively low construction period of the past 2-3 years. Additionally, export orders are also likely to grow. Under these trends, we believe there are numerous opportunities along the industry chain.

In 2025, domestic wind power installations are expected to reach 110-120GW, with offshore wind power showing strong growth potential. The overseas market is also on an upward trend. We anticipate that domestic wind power installations will reach 110-120GW in 2025, setting a new historical record for the third consecutive year. Specifically, offshore wind power is expected to experience high growth, with a forecasted new installation of 14/17GW in both conservative and optimistic scenarios. Meanwhile, the overseas onshore wind market is gradually recovering, and the overseas offshore wind market may experience a release of large-scale orders.

We have identified three key areas of focus for China's wind power industry chain in 2025:

1. Domestic Offshore Wind Flexibility: We believe the offshore cable segment is entering a continuous upward cycle of industry orders and deliveries, and the industry is expected to benefit from the certainty of ultra-high voltage transmission. Additionally, we expect the offshore wind tower and foundation segments to reverse the delivery and profitability pressure from the past two years, with accelerated offshore wind project starts. In 2025, both volume and profits are expected to rise significantly.

2. Wind Turbine Direction: We believe the most competitive phase of the domestic wind turbine market has likely passed. Overseas wind turbine companies have gradually retreated to high-price markets, and domestic wind turbine companies are expected to benefit from long-term growth driven by both domestic offshore wind power and export demand. We anticipate that the profit recovery trend starting in 2024 will continue.

3. Wind Power Export Direction: We prioritize the following areas for attention:

2. The turbine segment benefits from the widening price gap between domestic and overseas turbines, with overseas companies focusing on high-price markets and increasing demand for onshore wind in Africa, Asia, and Latin America. We expect continued growth in new overseas turbine orders signed by domestic companies.

3. The processing fees for offshore wind turbine foundations have continued to rise. As offshore wind projects connected to the grid between 2027-2030 gradually start, we expect the industry to enter a concentrated order procurement cycle.

This article is excerpted from: "Wind Power Equipment 2025 Outlook: Industry Chain Opportunities Under New Highs in Installed Capacity," published on December 30, 2024.

Che Yunji - Analyst SAC License No.: S0080520100002 SFC CE Ref: BQL481
Liu Jianyi - Analyst SAC License No.: S0080520070002 SFC CE Ref: BNJ556
Li Jiaying - Analyst SAC License No.: S0080524080009