League of Nations Minsheng Securities: The gas engine boom is spreading, and the industrial chain market has all entered a fast track of growth

The Zhitong Finance App learned that Guolian Minsheng Securities released a research report saying that, driven by AIDC electricity demand, the gas turbine industry has entered a long-term upward cycle. Overseas leading orders and price indices are rising at the same time, and the high share of services has led to an upward shift in the valuation center. The domestic industrial chain has accelerated the ability to replace domestic production and expand production to absorb external demand spillover. The bank's proposal focuses on three main lines: first, it is optimistic about domestic combustion engine units and integrated leaders; second, it focuses on core component manufacturers and supporting equipment manufacturers entering the supply system of overseas OEMs; and third, it is optimistic about targets that are deeply tied to the natural gas generator supply system.

The main views of Guolian Minsheng Securities are as follows:

The global gas engine boom is booming

Driven by AI computing power, grid updates, and coal-to-gas, the global gas turbine industry is ushering in a new strong upward cycle. The demand side is driven by three core drivers: rapid growth in AI computing power brings immediate demand for power, and power consumption in data centers is growing exponentially. With its advantages of high stability, small footprint, and 24x7 uninterrupted power supply, gas power generation has become the core option for North American tech giants' AI data centers; under the global energy transformation trend, natural gas is used as a transition fuel to drive the coal-to-gas process; stock units have reached the peak of upgrading. More than 50% of power grid infrastructure in developed economies has been in use for more than 20 years, spawning demand for equipment renewal and maintenance.

The core power supply method is recombustion. Light-fuel to replace heavy gas turbines are the main power supply for large power plants and combined cycle power plants. The stand-alone power is 50 MW or more, and the H/J class combined cycle efficiency exceeds 60%. They have the advantages of high power, long life, and high stability, and are the optimal baseload power supply solution. It has flexible positioning and replacement for aviation-modified combustion engines and lightweight combustion engines. It has the ability to start and stop quickly, and can be quickly deployed through modular design, adapting to distributed energy, peak shifting and rapid energy replenishment scenarios.

Global gas turbine market

In the context of overseas production expansion, domestic replacement opportunities highlight the global gas turbine market showing a highly concentrated oligopoly pattern. GEV, Mitsubishi Heavy Industries, and Siemens Energy together account for about 85% of the market share. Currently, all three OEMs have entered a phase of both order and production capacity expansion, and the resulting shortage of core components has become a key bottleneck limiting the release of production capacity by global OEMs. This has created a historic window for domestic components to enter the global supply chain.

natural gas generator

The fast response choice for small to medium power scenarios Natural gas generators have become the preferred solution for quick response to electricity demand in small and medium power scenarios due to their short construction cycle, flexible deployment, environmental protection and economic advantages. Its delivery cycle is 18-36 months, which is significantly shorter than 3-5 years for heavy combustion engine supply spillover demand. It quickly penetrates data center backup, distributed power generation, and industrial load scenarios. Leading companies in the industry such as Caterpillar and Wärtsilä continue to receive large orders, and the industry has entered a period of booming expansion.

Aviation combustion engine

Derived from aviation technology, the aviation combustion engine, a powerful tool for rapid peak regulation, was modified from the core engine of an aero engine. It inherits its characteristics of high efficiency, light weight, and quick start/stop. It is the core equipment for power grid peak shifting and distributed energy. The global market is dominated by GEV, Siemens, and Baker Hughes, which together account for about two-thirds of the market. Its core application scenarios focus on fields such as rapid peak shifting power plants, distributed energy, and offshore oil and gas platforms. Relying on the advantages of aviation technology accumulation and recycling residual value from decommissioned aircraft, it has been growing steadily over a long period of time.

Risk warning: risk of raw material price fluctuations, international trade frictions, exchange rate changes, risk of data forecast deviation.