(Report Producer/Analyst: Dong Haijun, Capital Securities)
From 2023 to 2025, the scale of data center temperature control is expected to exceed 90 billion.
According to the 2023 White Paper on the Development of China's Data Center Industry, it is expected that by the end of the 14th Five-Year Plan period in 2025, the size of data center racks will grow to 14 million, tripling the total size compared to 2021. We assume that from 2023 to 2025, the growth rate of rack count will gradually increase, which will be 26%/29%/33%, respectively, and the proportion of temperature control costs in data center capital expenditure will stabilize at 16%. After calculation, it is estimated that the temperature control demand of data centers from 2023 to 2025 will be 215/306/42.9 billion yuan, respectively.
With the trend of increasing power density and PUE requirements, technology integration will become a trend.
With the rapid advancement of AI technology and other high-power application scenarios, the power density of a single chip continues to increase, which will drive the growth of cabinet power density. In the context of carbon peaking and carbon neutrality, PUE requirements have also increased significantly. The policy clearly requires that by 2025, the PUE of the eastern hub node data center will be < 1.25, and the PUE of the western hub node data center will be <1.2. In fact, at present, the feasibility study and approval of data center projects in many provinces require the design PUE to be below 1.2. With the increasing power density and PUE requirements, the demand for efficient cooling will increase, and technology integration will become a trend.
The development of energy storage has driven the demand for temperature control, and the permeability of liquid cooling has increased.
In order to alleviate the impact of large-scale access to wind and solar energy on the stability and reliability of the power grid, new energy storage has developed rapidly, and the cumulative installed capacity of new energy storage in mainland China has increased from 1.1GW to 13.1GW from 2018 to 2022, with a CAGR of 87.0%. The development of new energy storage has led to a simultaneous increase in the demand for temperature control. Liquid cooling, on the other hand, has the advantages of high and uniform heat dissipation efficiency, low energy consumption, small footprint, and system adaptability, and its penetration rate continues to increase.
Platform-based R&D and high R&D investment help the company adapt to the development and changes of industry needs.
The company adopts a platform-based R&D model, which is conducive to mutual collaboration between businesses. At the same time, the company maintains a high level of R&D investment, maintains a high level among competitors, and helps the research and development of new products and technologies. The company is deeply engaged in the field of precision temperature control, with a rich product series, and new products and new technologies are continuous, which is expected to fully benefit from the strong industry demand and demand changes.
Earnings Forecast:
It is predicted that from 2023 to 2025, the company's net profit attributable to the parent company will be 3.9/5.4/710 million yuan respectively, with a year-on-year growth rate of 40%/36%/32% respectively, and the corresponding PE will be 37/27/21 times respectively.
Risk Warning:
Growth and cooling demand in areas such as data centers, computing power equipment and energy storage are lower than expected, and industry competition is intensifying, and profit margins are decreasing.
——————————————————
The report belongs to the original author, only for Xi! If there is any infringement, please delete it privately, thank you!