Guojin Securities: Initiates Coverage on Jinpan Technology with Buy Rating

Guo Jin Securities Co., Ltd. Yao Yao recently conducted research on Jinpan Technology and released a research report titled “Steady Performance Growth, AIDC & Overseas Business Expansion Driving Double Growth,” giving Jinpan Technology a “Buy” rating.

Jinpan Technology (688676)

Performance Summary

On March 20, the company disclosed its 2025 annual report, showing revenue of 7.29 billion yuan in 2025, up 5.7% year-over-year; net profit attributable to shareholders of 660 million yuan, up 14.8% year-over-year; gross profit margin of 25.9%, up 1.5 percentage points; of which Q4 revenue was 2.1 billion yuan, down 0.1% year-over-year; net profit attributable to shareholders of 170 million yuan, up 1.9% year-over-year; gross profit margin of 25.3%, up 0.7 percentage points.

Operational Analysis

Significant growth in data center business, proactive deployment of SST/HVDC technology.

Benefiting from global AI computing power demand, the company’s data center (including AIDC) business achieved revenue of 1.34 billion yuan, a 197% increase year-over-year, completing approximately 400 data center projects including Baidu, Alibaba, and China Mobile. The company has proactively deployed next-generation power supply technologies such as HVDC and SST, completed the design and production of SST prototypes, and officially lit up Jinpan Technology’s AIFactory smart factory with self-developed HVDC products, fully deploying core computing infrastructure and pioneering an “AI + Manufacturing” physical model.

Overseas Business Achieves Remarkable Results, Sufficient Order Backlog.

The company adheres to a global development strategy, continuously deepening its global business layout. The Malaysia factory was put into operation in 2025, with overseas revenue reaching 2.3 billion yuan, a 16.0% increase year-over-year. As of the end of the period, the company’s foreign order backlog was as high as 3.49 billion yuan, indicating ample order reserves.

Traditional Advantage Business Stable, Energy Storage Business Under Short-term Pressure.

Benefiting from high industry prosperity, wind power revenue increased by 39.6% year-over-year; power generation and supply increased by 16.8%, providing a solid “ballast” for the company’s performance. The energy storage business achieved revenue of 620 million yuan, up 18.6% year-over-year, but due to fierce domestic market price competition, gross margin declined from 11.2% to 7.6%, with short-term profitability under pressure.

Upstream Industry Chain Deployment and Digital Transformation Deepening, Profitability Enhanced.

Under the national push for high-efficiency energy-saving transformers, the company’s “Amorphous Alloy Steel Core Digital Factory Project” successfully commissioned its amorphous strip production line, which is expected to significantly reduce unit costs while ensuring raw material supply. Additionally, the company is advancing digital transformation, optimizing operational efficiency and management quality. Benefiting from higher proportions of high-value products and cost reductions from digital manufacturing, the company’s overall gross profit margin increased by 1.5 percentage points to 25.9%.

Profit Forecast, Valuation, and Rating

The company leads in overseas capacity deployment and is deeply involved in global AIDC power supply and distribution construction. Benefiting from overseas transformer supply-demand mismatches and a domestic order rebound, it is expected to achieve net profit attributable to shareholders of 960 million, 1.31 billion, and 1.66 billion yuan in 2026-2028, respectively, representing year-over-year increases of 45%, 37%, and 27%. The current stock price corresponds to P/E ratios of 39x, 28x, and 22x, respectively, maintaining a “Buy” rating.

Risk Tips

Deterioration of the international trade environment, cyclical fluctuations in downstream industries, intensified industry competition, etc.

Latest profit forecast details are as follows:

In the past 90 days, 10 institutions have issued ratings for this stock, with 8 recommending “Buy” and 2 recommending “Hold”; the average target price among institutions over this period is 102.9 yuan.

The above content is compiled from public information by Securities Star, generated by AI algorithms (Wang Xin Suan Bei 310104345710301240019), and does not constitute investment advice.