Industrial Securities recent research report pointed out that the current A-share manufacturing leader has been at A low level from a global perspective, including power equipment and new energy, TMT, and home improvement valuation advantages.

TVD1.3-15-03 In addition, the new momentum direction represented by the digital economy, AI, and high-end manufacturing has been catalyzed by the industry in the near future, which is expected to gradually map to the investment opportunities in the stock market, and the new industrial trends will also become an important investment main line.

Power equipment and new energy valuation advantages are significant

What is the current valuation level of A-share manufacturing leaders? Is it significantly cheaper than the world’s leading manufacturers? Which segments are significantly underrated?

Industrial Securities recently released the “Global leading valuation comparison: Manufacturing” research report pointed out that compared with the valuation level of global manufacturing leaders, it can be found that after the valuation compression of the past three years, the current A-share manufacturing leaders have been at A low level from a global perspective. From the perspective of the broad categories of industries divided, power equipment and new energy, TMT, and home improvement valuation advantages are significant, and the automobile and light industrial manufacturing industries are close to the overall valuation level of overseas.

From a PE-G perspective, the GICS sub-sectors that are valued well include electrical components and equipment, heavy electrical equipment, construction machinery and heavy trucks, tires and rubber, commercial printing, paper products, consumer electronics, electronic components, electronic equipment and instruments, communications equipment, home appliances, home decor, building products, and environmental and facility services.

From a PB-ROE perspective, GICS sub-sectors TVD1.3-15-03 with strong valuations include electrical components and equipment, heavy electrical equipment, home appliances, home decor, and environmental and facility services.

Ten industry trends are expected to become the main line of investment

In another research report entitled “Ten Industrial Trends worth paying attention to in 2024”, Industrial Securities pointed out that the current domestic economy is shifting from traditional drivers to new drivers, and new drivers are the areas with the broadest space for future growth. The new momentum represented by the digital economy, AI, and high-end manufacturing has been catalyzed by the industry in the near future, which is expected to gradually map to the investment opportunities in the stock market.

The research report selected ten industrial trends that will usher in important changes in TVD1.3-15-03 industrial development in 2024 and are expected to become important investment lines:

Computing power: Overseas head accelerates “internal volume”, and domestic manufacturers are rising. With the outbreak of downstream demand for AI in China and the increasing tightening of the inflow of overseas chips, the computing power of domestic AI chips is expected to continue to iterate, and the volume price can be expected in the future, which is a long-term trend worthy of attention.

Large model: Global ecological optimization and improvement, domestic large model acceleration iteration. Future focus: The advantages of industry leaders in the field of universal models will continue to expand over time, and powerful technology, capital, talent and applications allow large enterprises to dominate. Smes face challenges and opportunities and can rely on their strengths in specific market segments and data processing to become key players in verticals.

Consumer electronics: With the addition of hardware and software, AI leads the new wave of consumer electronics. It is recommended to focus on: AIPC: personal computer products equipped with AI-driven graphics cards and AIGC applications, TVD1.3-15-03 Lenovo, HP and other traditional giants will quickly introduce the track, focusing on the domestic PC industry chain opportunities; AIXR: A wearable terminal that can be deeply coupled with AIGC, Apple is expected to lead the rapid development of the industrial chain, and the domestic XR equipment production industry chain is expected to benefit; AI mobile phones: mobile devices equipped with local AI large models, Huawei, Google, VIVO and other manufacturers that have made breakthroughs in large models are expected to win.

Data elements: Accelerate the systematic construction and promote the integration of data and industry. It is suggested to focus on: data supply: data suppliers, data service providers; Data circulation: participating enterprises of data exchange; Data requirements: digital transformation service providers, data applications.

Intelligent driving: Entering a new stage, high-level intelligent driving accelerates the landing. TVD1.3-15-03 Future focus: High-level intelligent driving technology is expected to continue to achieve major breakthroughs, especially in the cockpit, perception, decision-making and control systems; Accelerated commercial applications: More domestic Oems are expected to launch new models with high-level intelligent driving functions, while travel service providers may begin to deploy self-driving taxis or unmanned delivery vehicles on a large scale; Vehicle networking: Focus on roadside core equipment, communication terminals and equipment, information security and other links.

Humanoid robot: When the commercialization burst out, the industrialization accelerated the landing. Looking to the future, intelligent robots are expected to achieve small-scale mass production in 2024, and are expected to increase significantly in 2025, driving the benefit of the whole industrial chain. Focus on parts with large value of the industrial chain, such as motors, ball screws, retarders, sensors, etc.

Low-orbit satellite communication: From 0 to 1, the low-orbit satellite network is fully rolled out. It is expected that the market space will exceed 700 billion yuan in 2027, and the future will focus on the satellite launch industry chain, the development progress of reusable rockets, and the future TVD1.3-15-03 development trend of satellite Internet.

Low-altitude economy: eVTOL is expected to become the new “explosion point”. eVTOL is in the early stage of 0 to 1, and is expected to reach a CAGR of 18.3% before 2030, which is expected to become a new explosive point of low-altitude economy, focusing on mass production delivery and airworthiness certification in the future.

MR: Vision Pro opens a new era, and the singularity of Android platform is coming. It is expected that the CAGR in 2023-2029 will be 41.2%, and the future will focus on the release of MR New products and the introduction of explosive applications and content, and the domestic XR manufacturing industry chain is expected to benefit from the increased penetration rate.

Hydrogen energy: Policy guidance, scenery hydrogen integration projects continue to land. It is expected that the annual demand for hydrogen in China will increase to about 130 million tons in 2060, and the future will focus on key technological breakthroughs in hydrogen production technology, storage and transportation technology and fuel cells.