Analysis of the Reasons for and Sustainability of the Recent Strong Performance of Luokai Shares (603829)

This analysis is based on tushare_strong_pool data [0]. Luokai Shares (603829) has recently shown strong stock price performance. On November 21, the closing price was 25.94 yuan, with an increase of 10.01%, achieving 3 limit-up days in 5 trading days [0]. Core driving factors include the completion of convertible bond redemption, favorable policies for the smart grid industry, and capital inflows into the sector [0].

On November 21, Luokai Shares completed the redemption of Luokai Convertible Bonds, with a total redemption amount of 756,327.67 yuan, and the convertible bonds were delisted [1]. Previously, the company’s stock price closed above 130% of the conversion price for 15 consecutive trading days, triggering the redemption clause [0]. This event may enhance market confidence in the company’s stock price.

Luokai Shares belongs to the smart grid concept sector, mainly engaged in medium and low voltage distribution equipment (circuit breakers, ring main units, etc.) [0]. The 15th Five-Year Plan clearly proposes to build a new type of power system and accelerate the construction of smart grids [7], driving the growth of demand in the distribution equipment industry. Data from the China Electrical Equipment Industry Association shows that the power equipment sector benefits from grid upgrades and new energy grid connection demand, with broad market space [8].

In Q3 2025, the company’s revenue was 1.675 billion yuan, an increase of 9.60% year-on-year, but net profit was 71.4216 million yuan, a decrease of 14.93% year-on-year [0]. Revenue growth reflects strong industry demand, but the decline in net profit may be affected by rising costs or product structure changes [0].

Dragon and Tiger List data shows that Luokai Shares received capital attention on November 21 [3]. The power equipment sector has continued to receive institutional capital inflows recently [0], and the sector rotation effect is obvious [0].

• The convertible bond redemption event and strong stock price form a positive cycle: The completion of redemption eliminates the dilution pressure from conversion, while the strong stock price triggered the redemption clause, enhancing market expectations.
• The company’s position in the smart grid supply chain: As a distribution equipment supplier, it directly benefits from the policy dividends of the 15th Five-Year Plan [7].
• Differentiated financial performance: Revenue growth and profit decline coexist; attention should be paid to the company’s cost control capabilities and changes in product gross margin [0].

1. Profit Pressure
   : Q3 net profit decreased by 14.93% year-on-year. If costs continue to rise, it may affect future profitability [0].
2. Market Volatility
   : The short-term stock price has risen sharply, and there is a risk of correction [0].
3. Industry Competition
   : The distribution equipment industry is highly competitive; attention should be paid to changes in the company’s market share [8].

1. Policy Dividends
   : The 15th Five-Year Plan promotes smart grid construction, and the demand for the company’s products is expected to continue to grow [7].
2. Sector Growth
   : The power equipment sector is favored by capital, and the company may benefit from the valuation improvement of the sector [0].

The recent strong performance of Luokai Shares is the result of the combined effect of company events, industry policies, and market capital. Although Q3 net profit declined, revenue growth reflects positive industry demand. Investors should comprehensively consider policy dividends, the company’s financial status, and market volatility risks to make rational decisions.