The latest data released by the National Wind Power Information Management Center shows that as of the first quarter of 2013, the scale of wind power under construction in China still exceeds 40 million kilowatts. This means that in the middle and later stages of the 12th Five Year Plan, the space for newly added wind power installed capacity in the country can still reach an average of nearly 15 million kilowatts per year, and the wind power industry may usher in a stage of recovery opportunities. This signs of recovery have begun to emerge, with a surge in the national wind power bidding volume in the first quarter of this year, and the performance of related companies in the first quarter has also improved compared to before, especially leading wind power equipment manufacturers.

Analysis shows that the acceleration of wind power construction will lead to a surge in bidding volume, which in turn will drive up orders from equipment manufacturers, which will have a significant positive impact on the wind power equipment manufacturing industry. However, due to the lack of improvement in the phenomenon of wind power curtailment and restrictions, the performance improvement of wind power developers is relatively weak.

Mid term performance of wind power equipment manufacturers is expected

The wind power company's performance has improved in the first quarter of this year. According to Wind data statistics, the net profit attributable to shareholders of 21 A-share wind power companies in the first quarter of this year increased by 6.69% compared to the same period last year. This is a significant improvement compared to last year's overall performance decline in the wind power industry, even falling into a loss situation.

According to statistical data, among the top five wind power equipment manufacturers, apart from Huarui Wind Power's continued significant decline in net profit, Goldwind Technology and Xiangdian Corporation both reported good performance. Among them, Goldwind Technology's net profit increased sharply by 425.52% year-on-year, and Xiangdian Corporation also increased by 99.50% year-on-year. According to the analysis of Guoxin Securities, the direct cause of performance improvement is the increase in gross profit margin caused by the reduction of manufacturer costs. For example, in the first quarter, the gross profit margin of Goldwind Technology's main wind turbine unit increased from 16.53% last year to 17.90%.

The deeper reason is the surge in bidding capacity for domestic wind power projects since the beginning of this year. The total capacity of domestic wind power projects publicly tendered in the first quarter of this year was 3.9GW, a year-on-year increase of 74%, nearly half of the total capacity of 8.3GW publicly tendered last year.

According to the first quarter report of Goldwind Technology, as of the end of March this year, the total number of pending orders for the company was 4.576 million kilowatts, including 404000 kilowatts of overseas orders. In addition, the company won the bid for an unsigned order of 307900 kilowatts, with a total of 7.6545 million kilowatts in hand.

Due to the abundance of orders in hand compared to before, various equipment manufacturers have made good expectations for the first half of this year's performance. After achieving a 10% increase in net profit in the first quarter, wind power component leader Tian Shun Wind Energy is expected to see a 30% year-on-year growth in performance in the first half of the year, while Goldwind Technology expects a 50% increase in mid year performance. Short term weak recovery in the industry

According to the latest data released by the National Wind Power Information Management Center, as of March 31 this year, the cumulative approved wind power capacity in China is 108.46 million kilowatts. Among them, the grid connected capacity is 65.71 million kilowatts, and the under construction (including preliminary work) capacity is 42.75 million kilowatts. This means that in the middle and later stages of the 12th Five Year Plan, the annual average installed capacity of new wind power in China can still reach nearly 15 million kilowatts, and the wind power industry may usher in a phased recovery opportunity.

This sign of recovery is reflected in a series of indicators in the current wind power industry. The data shows that the equivalent utilization hours of wind power in China increased by 542 hours in the first quarter of this year. Based on this calculation, the total utilization hours of wind power for this year will exceed 2100 hours, significantly higher than the level of 1959 hours last year. Analysts from Guotai Junan pointed out that the utilization hours of wind power are the most core indicator for measuring the operational efficiency and quality of wind power projects. Currently, this indicator needs to be substantially improved. According to its forecast, among the leading domestic wind power developers in 2013, Longyuan Power's wind power utilization hours were expected to improve by approximately 4.0% year-on-year, while Datang New Energy's utilization hours were expected to improve by 5.1% year-on-year.

In addition, the policies of the National Energy Administration in 2013 will be comprehensively optimized in terms of wind power market space, transmission, operation, and renewable energy subsidies. In another key indicator, the level of wind power grid connection, the bottleneck is currently being substantially accelerated. According to data statistics, the national wind power grid connected capacity in the first quarter of this year was 32.8 billion kilowatt hours, equivalent to one-third of the total capacity of last year. Currently, the proportion of national wind power grid connected capacity to the approved total capacity is as high as 61%.

However, in terms of the indicator of "wind curtailment", which has been troubling the healthy development of the wind power industry in recent years, the industry's economic losses caused by wind curtailment exceeded 10 billion yuan last year, and the wind curtailment rate (the proportion of wind curtailment to total installed capacity) reached 17.12%. As of the first quarter of this year, this ratio has reached 22.65%, indicating that the phenomenon of wind abandonment is still worsening.

Guotai Junan pointed out that with the improvement of grid connection conditions and the development of wind farms in low wind speed areas, the domestic wind power market is gradually recovering. However, industry analysis further suggests that this recovery may show a certain trend in the short term, but in the long run, if the situation of wind abandonment does not improve, it will greatly weaken this recovery trend. Especially for wind power developers, wind abandonment leads to a decrease in their project development enthusiasm, which may delay the overall growth of wind power installation scale.

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