1 minute 20% daily limit up! Four major catalysts suddenly hit! Entire sector collectively erupts!

Power Sector Experiences a Structural Surge in Early Trading!

This morning (March 18), the A-share power sector performed actively. Just one minute after opening, Jawi New Energy hit the daily limit with a 20% surge. China Power LiaoNeng hit three consecutive daily limit-ups, while Guangdong Electric Power A, ShaoNeng Shares, and Yabo Shares also hit the limit. New China Harbor, China Electric Power, Jiangsu New Energy, and Min Dong Electric Power performed well.

An institution stated that the power sector combines high dividends with growth potential. Currently, there are four major positives: First, from top-level design to token globalization, power has become a core asset in the AI era; second, the logic of rising electricity prices is strengthening, leading to a revaluation of utility assets; third, it aligns with the “HALO” asset paradigm, offering both strong defense and transformation growth dividends; fourth, valuation gaps are emerging, with power assets offering both offense and defense.

Power Sector Rebounds Again

Today, some power stocks have become market consensus favorites. Jawi New Energy opened with a limit-up, and Yabo Shares quickly hit the limit as well. Both are typical photovoltaic concept stocks within the green energy sector.

Western Securities pointed out that the proportion of new energy power generation continues to increase, but the fundamental mechanism of power dispatching remains unchanged. Grid regulation and safety margins are shrinking, making absorption conflicts more severe. The rapid growth of new energy installations has led to localized absorption issues. As a controllable load factor, computing power is expected to enhance autonomous absorption of new energy. Policies like “East Data West Computation” support “Western electricity to Western use,” guiding industry migration westward. With AI advancements, smart grid technology is expected to help solve grid connection issues, forming an industrial closed loop and strongly supporting the development of a technology-driven nation.

Coal-fired power also performed well. Shennan Electric, Guangdong Power A, and China Power LiaoNeng all hit the daily limit, while China Energy, Hui Hengyun, Huayin Electric Power, and Jiantou Energy performed strongly. Notably, Guangdong Power A and China Power LiaoNeng opened with a straight limit-up, and Shennan Electric also hit the limit instantly.

Following attacks by the US and Israel on Iran, the Strait of Hormuz shipping has nearly come to a halt, causing extreme volatility in global oil prices. On March 16, South Korea’s ruling Democratic Party announced plans to lift restrictions on coal power capacity and increase nuclear plant utilization to 80%. The party’s Middle East crisis economic response team stated these measures aim to stabilize energy supply and prices, as tensions in the Strait of Hormuz hinder oil and natural gas shipments to South Korea.

Four Major Highlights

According to GF Securities, the power sector has four key highlights:

Highlight 1: From top-level design to token globalization, power has become a core asset in the AI era. The 2026 government work report first proposed “computing and electricity collaboration,” elevating the development of power and computing power as a national-level new infrastructure strategy. As of March 9, global token consumption exceeded 15T in a single week, with explosive growth in computing demand. Meanwhile, driven by cost advantages and improving model capabilities, domestic model token calls are expected to continue rising, further boosting global AI computing demand.

Highlight 2: The logic of rising electricity prices is strengthening, leading to a revaluation of utility assets. After the issuance of the “Notice on Improving Capacity Electricity Price Mechanisms for Power Generation” in 2026, capacity electricity prices for coal, gas, pumped storage, and independent new energy storage on the grid have been further refined. Additionally, ongoing conflicts like Russia-Ukraine and tensions in the Middle East disrupt global energy supplies, with upward pressure on upstream coal and natural gas prices. As market-oriented mechanisms deepen, energy prices are gradually passing through to electricity prices, pushing the price center upward and further enhancing power asset profitability.

Highlight 3: Aligning with the “HALO” asset paradigm, offering both strong defense and growth dividends. In the A-share market, power assets perfectly fit the “heavy assets, low淘汰” investment narrative, with shareholder equity backed by substantial physical credit and high resilience to volatility. Due to their heavy capital investment and high capital utilization, these assets typically maintain higher ROE than the broader A-share index over the long term, with significant dividend yields. This high ROE and dividend profile allow for long-term allocation without excessive timing concerns, combining cyclical offensive potential with steady dividends.

Highlight 4: Valuation gaps are emerging, with power assets offering both offense and defense. From a valuation perspective, the current power index’s PE and PB ratios are below historical averages relative to the power grid equipment index. Additionally, the overall dividend yield of the power index significantly exceeds that of the grid equipment theme index, indicating higher asset value for money. Furthermore, the allocation of public utility sectors in active equity funds is at historically low levels, presenting a clear low-coverage recovery opportunity.

(Source: Securities Times)