Analysis of TBEA Co., Ltd. (600089.SH) - A Hot Stock: Investment Value Assessment Driven by the 4 Trillion Yuan Grid Investment Policy

TBEA Co., Ltd. recently became a market favorite with the core catalyst being the fixed-asset investment plan for the ‘15th Five-Year Plan’ announced by State Grid Corporation of China (SGCC) on January 15, 2026. According to official disclosures, SGCC’s fixed-asset investment will reach 4 trillion yuan in the next five years (2026-2030), a 40% increase compared to the ‘14th Five-Year Plan’ period, hitting a record high [1][2]. This heavyweight policy has directly ignited enthusiasm in the power grid equipment sector, and TBEA, as a leading enterprise in the domestic transformer industry, has been sought after by capital amid the policy benefits.

From the perspective of policy details, power grid construction during the ‘15th Five-Year Plan’ period will present a pattern of multiple growth points: cross-regional and inter-provincial power transmission capacity will increase by more than 30% compared to the end of the ‘14th Five-Year Plan’, the annual newly installed capacity of wind and solar new energy in the operating area will reach 20 GW, and the construction of urban, rural, and remote area distribution networks will be comprehensively promoted [1][2]. In addition, SGCC will implement an ‘Artificial Intelligence +’ special action to strengthen the digital empowerment of power grids, which provides additional growth momentum for the demand for smart grid equipment [2].

In terms of market performance, TBEA’s stock price has shown volatile movements. It hit the daily limit twice on January 13 and January 19, with a single-day increase of 12.21% on January 19, and the intraday high touched 32.99 yuan, a 52-week high [0][4]. As of the close on January 20, the stock price was reported at 30.78 yuan, with a cumulative increase of 17.48% in the past 5 days, 40.68% in the past month, 34.53% since the beginning of the year, and a 52-week increase of as high as 154.59% [0].

The capital side shows obvious institutional-led characteristics. On January 19, the main capital net purchase reached RMB 2.408 billion, accounting for 11% of the daily trading volume, and the balance of margin trading and securities lending remained at a high level of RMB 8.124 billion [4]. However, it should be noted that during the same period, hot money had a net outflow of RMB 1.313 billion, and retail investors had a net outflow of RMB 1.095 billion, indicating significant divergence in the market [4]. The high turnover rate (14.71% on January 19) and intraday amplitude (12.6% on January 20) both indicate intense chip swapping, and investors need to be alert to the pressure of short-term profit-taking.

From a fundamental perspective, TBEA’s Q3 2025 performance was outstanding. The net profit attributable to parent companies in the quarter reached RMB 2.3 billion, a year-on-year increase of 81.51%, and the cumulative net profit in the first three quarters was RMB 5.484 billion, a year-on-year increase of 27.55% [3][4]. The company’s gross profit margin is 18.27%, asset-liability ratio is 56.13%, and ROE is 7.67%, with an overall stable financial status [4].

In terms of business layout, the company covers four sectors: power transmission and transformation, new energy, energy, and new materials. As a leading domestic transformer enterprise, it has core technological advantages in the UHV transformer field, and also holds a leading technical position in polysilicon production. The company’s recent moves include acquiring a 74.19% stake in Yangzhou Shuguang Cable to strengthen its mid-to-high-end cable layout, and planning to issue convertible bonds of no more than RMB 8 billion for the Zhundong coal-to-natural gas project [3].

TBEA’s strong performance reveals the resonance effect of multiple cross-domain investment logics. First, the correlation between grid investment and AI computing power demand is strengthening - global data center power consumption is expected to increase from approximately 176 TWh in 2023 to 580 TWh in 2028, making the demand for power infrastructure upgrades urgent [3]. Second, the synergistic effect between new energy consumption and UHV construction is significant. With the continuous growth of installed wind and solar new energy capacity, the construction of cross-regional power transmission capacity has become a rigid demand.

From an industrial chain perspective, the power grid equipment industry is entering a new round of prosperity cycle. SGCC’s 4 trillion yuan investment plan not only benefits UHV equipment manufacturers, but also drives multiple segments such as distribution network upgrading and smart grid construction. Stocks in the power grid equipment sector, including Siyuan Electric Co., Ltd. and China XD Electric Co., Ltd., all hit the daily limit, showing capital’s pursuit of the entire industry sector [6].

Currently, TBEA’s price-to-earnings ratio (TTM) has reached 29.88 times, which is at a historically high level [0]. Looking back at the starting point of this round of rally, the stock price started from 24.19 yuan on January 7, breaking through the 30-yuan integer mark in just two weeks, with an increase of more than 25%. Behind this rapid rise, there are both support from fundamental expectations and components driven by sentiment.

It is worth noting that some market rumors - such as the company winning a transformer project for xAI data centers in the US, and cooperation with Tesla’s FSD, etc. - have not been officially verified [7]. Senior investment advisors have issued a risk warning that “chasing the rise is not recommended in the short term” [3]. When participating, investors need to distinguish between value investment and speculative hype to avoid taking over at high levels.

From a medium-to-long-term perspective, the 4 trillion yuan grid investment policy provides solid fundamental support for the company. Factors such as accelerated UHV construction during the ‘15th Five-Year Plan’ period, growing demand for new energy consumption, and distribution network upgrading and transformation will continue to drive the demand for power transmission and transformation equipment. As an industry leader, TBEA is expected to maintain a leading position in order acquisition and market share.

In addition, the successful issuance of the company’s RMB 1 billion science and technology innovation bonds and the plan to issue convertible bonds of no more than RMB 8 billion demonstrate the company’s strong capabilities in financing channels and capital operations [3][5]. The acquisition of Yangzhou Shuguang Cable also indicates that the company is actively integrating industrial chain resources to enhance its comprehensive competitiveness.

From a time dimension analysis, the flexibility is greatest in the early stage after the policy release (around January 15). As market expectations are fully reflected, stock price fluctuations may gradually stabilize. Investors should focus on the subsequent order landing, quarterly performance realization, and the gradual implementation progress of the ‘15th Five-Year Plan’.

The core driver of TBEA becoming a hot stock is clear - the improvement of industry prosperity brought by SGCC’s 4 trillion yuan investment plan during the ‘15th Five-Year Plan’ period. As a leading domestic power transmission and transformation equipment enterprise, TBEA will directly benefit from policy dividends such as accelerated UHV construction and growing demand for new energy consumption, with solid fundamental support.

However, investors also need to objectively view the current market situation: the stock price has increased significantly in the short term, the valuation is at a historically high level, some market rumors are unconfirmed, and intense chip swapping indicates capital divergence. For investors who already hold positions, they may consider setting reasonable stop-profit and stop-loss levels; for off-market investors, it is recommended to wait for entry opportunities after a pullback, or adopt a phased position-building strategy to reduce costs.

In the long term, against the background of a high prosperity cycle of grid investment, TBEA has the value of continuous tracking. Key tracking points include: subsequent bidding results of UHV projects, quarterly performance, valuation digestion progress, and policy dynamics of industry development.