The Zhitong Finance App learned that Dongwu Securities released a research report saying that the profit of the 24H1 power equipment industry is expected to bottom out, production capacity clearance will accelerate, the supply and demand pattern will improve in 25 years, and the sector will regain growth. The main industry is still promoting the battery industry first, recommending Ningde Era (300750.SZ), Everweft Lithium Energy (300014.SZ), etc.; Dongwu Securities is optimistic about Kodali (002850.SZ), Tianci Materials (002709.SZ), etc. in terms of materials; and is optimistic about the direction of new technologies for high-voltage fast charging and composite fluid collection, targeting China Fusion Electric (301031.SZ) (follow), etc.; it is also recommended to focus on lithium carbonate (688612.SH) (follow), etc.; it is also recommended to focus on the lithium carbonate sector where prices are about to bottom out, and the lithium industry (00 lithium industry) is in line with the standard Tiantian (00 lithium industry) 2466.SZ), Ganfeng Lithium Business (002460.SZ), etc.

Global electric vehicles increased 20% year on year in '24, and demand for lithium batteries increased 25-30% year on year. Domestic demand is still the most determined market, and overseas demand is expected to accelerate slightly in '25. Dongwu Securities expects global sales of 13.25 million electric vehicles in 23, an increase of 31%, in line with expectations at the beginning of the year; a 20% increase of 20% to nearly 16 million units in '24, and a slight acceleration to 23% in '25, with sales of nearly 20 million units. Looking at the subregion, China's sales volume (including exports) will exceed 9.3 million units in 23, up 36%, better than expected at the beginning of the year, and is expected to increase 25% to 1.58 million units; Europe is affected by declining subsidies and is expected to increase slightly by 8% to 3.16 million units; the 25-year new car cycle+carbon emissions assessment is tightening, and the year-on-year growth rate is expected to rise back to 30% +; the US is still affected by high interest rates in the short term, and the new car sales rate of local car companies is delayed. The 24-year growth rate will drop to nearly 25%, with sales of 1.8 million vehicles + in the future. According to estimates by Dongwu Securities, the demand for moving batteries corresponding to 23-24 years was 1000/1,250 GWH, an increase of 26%/26%.

In the first half of intelligence and the second half of electrification, cost reduction of electrification is still the core, focusing on the volume of new technology. Intelligent automation first launched 200,000 models at the end of '24, which is an important competitive element for subsequent mid-range and high-end models, and may bring about changes in the competitive landscape of car companies. At present, Xiaopeng and Huawei have taken the lead. Orders for new cars are expected to exceed expectations, and the autonomous driving selection rate is over 60%. After the subsequent lack of images and lidar, it can sink to 100,000 to 200,000 models, further increasing the electrification rate. Car companies continued the 23-year trend of price reduction, and the overall price of new cars was low. After 24 years of slowing demand growth, price competition is expected to remain fierce. Therefore, the core of the industrial chain is still cost performance. It is expected that 24H1 fast charging and discharging capacity will increase rapidly, and 24H2 such as manganese, iron, lithium, and composite fluid collectors will gradually be released.

Capital expenditure in the main industry chain began to shrink, and the profit level basically bottomed out in 24 years. The core was to remove production capacity in '24, the supply and demand pattern improved in '25, and the industrial chain regained growth. Capital expenditure in the industrial chain has been tightened since Q2. Although the scale of projects under construction is high, new additions have slowed down. The supply and demand pattern has deteriorated in '24, but it will improve markedly in '25. From a profit perspective, at present, it has basically fallen below the reasonable profit level of second-tier manufacturers, but due to lackluster demand in the 23Q4 and 24Q1 industries, the industrial chain is still experiencing a wave of price cuts. It is expected that the bottom of 1H24 will appear and 2H24 will bottom out. It is expected that in 25 years, some of the better aspects of the pattern will take the lead, such as batteries, structural parts, electrolytes, etc., and the industrial chain will continue to grow strong, and small factories will gradually withdraw.

Investment advice: Dongwu Securities expects the 24H1 industry to bottom out profits, accelerate production capacity clearance, improve the supply and demand pattern in 25 years, and regain growth in the sector. Dongwu Securities, the main industry, is still the first to promote the battery sector, recommending Ningde Era (300750.SZ), Everweft Lithium Energy (300014.SZ), and BYD (002594.SZ).

In terms of materials, Dongwu Securities is optimistic about Kodali (002850.SZ), Tianci Materials (002709.SZ), Putailai (603659.SH), Enjie (002812.SZ), Xingyuan Materials (300568.SZ), Xinzhoubang (300037.SZ), Hunan Yuneng (301358.SZ), DeFang Nano (300769.SZ), Rongbai Technology (300073.SZ), Huayou Cobalt (688005.SH), Zhongwei () 603799.SH 300919.SZ) etc.

Also, I am optimistic about the direction of new technologies such as high-pressure fast charging and composite fluid collection, targeting China Fusion Electric (301031.SZ) (follow), Vmax (688612.SH) (follow), Mannst (301325.SZ), Sinde New Materials (301349.SZ), and Tiannai Technology (688116.SH).

At the same time, it is recommended to focus on the lithium carbonate sector where prices are about to bottom out, such as Tianqi Lithium (002466.SZ), Ganfeng Lithium (002460.SZ), China Mining Resources (002738.SZ), Yongxing Materials (002756.SZ), and Shengxin Lithium Energy (002240.SZ).

Risk warning: Electric vehicle sales fall short of expectations, and competition intensifies.