Dongwu Securities: Issue a Buy rating for Dajin Heavy Industry

Soochow Securities Co., Ltd. recent research by Duohong Zeng, Yanan Guo, and Junying Hu analyzed Daikin Heavy Industries and published the research report “2025 Annual Report Review: Performance in Line with Expectations, Transitioning from Product Provider to Integrated Solution Service Provider!”, giving Daikin Heavy Industries a “Buy” rating.

Daikin Heavy Industries (002487)

Investment Highlights

Event: The company released its 2025 annual report: revenue reached 6.17 billion yuan, up 63.3% year-over-year; net profit attributable to parent company was 1.10 billion yuan, up 132.8% YoY; gross profit margin was 31.2%, up 1.4 percentage points; net profit margin was 17.9%, up 5.3 percentage points. In Q4, revenue was 1.58 billion yuan, a 7.1% increase QoQ and a 10.0% decrease YoY; net profit attributable to parent was 220 million yuan, up 12.6% QoQ and down 36.6% YoY; gross profit margin was 31.4%, down 2.6 percentage points QoQ and 4.5 percentage points YoY; net profit margin was 13.7%, down 0.7 and 5.7 percentage points QoQ and YoY respectively.

In 2025, overseas segments saw both volume and profit increase, with overseas gross margin in H2 2025 improving QoQ. 1) Tower crane and pipe pile business: revenue was 5.92 billion yuan, up 66.2% YoY; gross profit margin was 29.6%, up 2.7 percentage points. Overseas revenue was 4.60 billion yuan, up 165.3%, with a gross margin of 34.0% (H1 2025 was 30.7%), continuing to improve QoQ; overseas gross profit contribution increased to 81%, becoming the main profit source. Total tower crane and pipe pile shipments reached 438,000 tons, up 13.0% YoY. 2) Power stations: revenue was 250 million yuan, up 16.4%; gross profit margin was 69.5%, down 9.0 percentage points. As of the end of 2025, the company had operational projects including 250MW wind and 250MW photovoltaic projects, with under-construction wind farms totaling 950MW.

Order backlog remains strong, with 2026 new orders expected to reach a record high. By the end of 2025, the company’s order backlog was 10 billion yuan, covering multiple offshore wind projects in North Sea and Baltic Sea regions. Historically, from 2021 to 2025, European offshore wind auctions exceeded 60GW, most projects not yet converted into formal foundation orders. We expect 2026 to be a major year for foundation bidding in Europe, and as the company’s market share expands, the order growth rate is likely to be further revised upward.

From FOB to DAP product provider, then to system service provider, with rapid expansion in unit value and profitability. After transitioning from FOB to DAP delivery mode in H2 2024, and with more complex TP-less single pile deliveries, Q4 2024 saw better-than-expected net profit per ton from overseas shipments. The company is gradually shifting from a single product manufacturer to a comprehensive solution provider covering manufacturing, transportation, storage, and installation. Currently, it owns two self-operated deck transport ships (the first successfully maiden voyage in February 2026), securing key port resources in Denmark, Germany, and Spain, driving rapid growth in unit value and profit. In the future, the deep-sea offshore engineering base in Caofeidian will coordinate with the European assembly base, forming a production structure of “R&D in Europe, testing in China, manufacturing domestically, and final assembly in Europe.”

Profit Forecast and Investment Rating: Due to intensified domestic land wind market competition and overseas trade protection, we have revised down the 2026-2027 performance forecasts. We now expect net profit attributable to parent of 1.72 billion yuan and 2.54 billion yuan for 2026 and 2027 respectively (previously 1.79 billion and 2.57 billion yuan), representing growth of 56% and 48%. Considering the rising unit prices in the overseas segments boosting profitability, we forecast 2028 net profit to reach 3.28 billion yuan, up 29%. The PE ratios for 2026-2028 are estimated at 26.1x, 17.7x, and 13.7x respectively. We maintain a “Buy” rating.

Risk Factors: Intensified competition, policy risks, and slower-than-expected export order realization.

Latest profit forecast details are as follows:

In the past 90 days, 6 institutions have issued ratings for this stock: 5 “Buy” and 1 “Hold”; the average target price among these institutions is 29.49 yuan.

This content is compiled from public information by Securities Star, generated by AI algorithms (Network Credit No. 310104345710301240019), and does not constitute investment advice.