The supply of gas turbine hot-end components is in short supply, and the global share expansion of Yingliu Electromechanical is highly certain (J.P. Morgan)
The J.P.
The J.P. Morgan report pointed out that the backlog of gas turbine orders for GE Vernova and Siemens Energy continues to extend and the pricing is strong, confirming the tight supply of upstream hot-end components. As the largest high-temperature alloy precision casting supplier in China, Yingliu Electromechanical will benefit significantly. Its global blade market share is expected to rise from about 2% currently to 10% in 2030. The market may view Yingqi Gas Turbine as a traditional manufacturing company and ignore its deterministic growth story of increasing its share in the global gas turbine supply chain. One sentence conclusion: Yingliu Electromechanical is standing at the starting point of the global gas turbine super cycle. With its technology and cost advantages, it is expected to achieve leapfrog growth in global market share. Positive/negative: Positive for Yingliu Electromechanical (603308). The current stock price may not fully reflect the long-term trend of increasing its global market share, and the market has underpriced its growth. Catalysts: 1) The order backlog and delivery data of downstream customers (GE, Siemens); 2) The production progress of new Yingzhou electromechanical production capacity and customer expansion announcements; 3) The increase in the proportion of gas turbine business revenue in subsequent quarterly financial reports.