The convergence of global AI computing power construction, energy transition, and grid upgrade demands is driving transformers to become a hard currency. Huayi Brothers Media Corp. stock opened sharply lower. On the first trading day of February (February 2), the A-share market declined in the morning session, with the Shanghai Composite Index dropping as much as 1.32%. Stocks like PIESAT, CHINA NATIONAL CULTURE, FUSHI INTERNATIONAL, CLOUDWATER, and XIAOCHENG TECHNOLOGY were among the biggest decliners. Former film giant Huayi Brothers Media Corp. (300027) opened with a steep decline, reaching an intraday maximum drop of 18.92%. Its latest share price fell below 2 yuan per share, hitting a new low for the past year.
The company released an earnings forecast on the evening of January 30, projecting a net loss between 289 million yuan and 407 million yuan for 2025, indicating a widening loss compared to the previous year. During the reporting period, the company's net non-recurring gains and losses amounted to approximately 17 million yuan, primarily attributable to gains and losses from the disposal of long-term equity investments and financial assets, as well as significant fair value changes in financial assets due to stock price fluctuations. A risk warning announcement issued by the company on the same day indicated that its estimated audited net assets at the end of 2025 are projected to be between -94 million yuan and 63 million yuan (unaudited). If the company's audited net assets at the end of 2025 are confirmed to be negative, according to relevant regulations of the Shenzhen Stock Exchange, the company's stock will be subject to a delisting risk warning. AI Heats Up Transformer Market. Chinese Manufacturers See Order Surge. According to reports, the global AI computing power build-out has entered an explosive growth phase, making high-power, highly stable power supply the "lifeline" of computing clusters. Power equipment transformers are being upgraded to become core components of computing infrastructure. In major Chinese manufacturing hubs like Guangdong and Jiangsu, numerous transformer factories are operating at full capacity, with some orders for data center-related business scheduled as far out as 2027. In the U.S. market, transformer delivery lead times have extended from 50 weeks to 127 weeks. Behind the surge in transformer orders lies a substantial increase in electricity consumption for computing power. As China accelerates the construction of computing power centers and supercomputing clusters, coupled with the deepening advancement of the "East Data West Computing" project, transformers, as the "heart of the power system," bear significant responsibility. AI supercomputing clusters demand extremely high power quality. China's transformer industry is leveraging its core technological advantages to conduct targeted R&D for solid-state transformers and high-frequency transformers, adapting to new energy integration and aiming to capture a larger share of the global computing power market. Data shows there are approximately 3,000 enterprises in China's transformer industry. In 2025, China's total transformer exports reached 64.6 billion yuan, an increase of nearly 36% compared to 2024. Against the backdrop of the ongoing "East Data West Computing" project, computing power parks are being densely deployed nationwide. The domestic transformer market size grew by over 20% year-on-year in 2025, with orders for high-end products related to AI computing power and ultra-high voltage accounting for more than 35%, becoming the core engine driving industrial growth. A research report from Galaxy Securities indicates that, based on Wood Mackenzie's annual supply-demand estimates for North America, the current supply gaps for power transformers and distribution transformers have reached 30% and 6%, respectively. Imported products are expected to account for 80% of U.S. power transformer supply and 50% of distribution transformer supply. According to data, the average export price of Chinese transformers has risen from $12,000 per unit in 2020 to $20,800 per unit in 2025, with prices for high-end models doubling. Transformer exports are expected to see growth in both volume and price. Transformer Concept Stocks Show Active Performance. In the secondary market, transformer concept stocks have recently shown active trends. According to statistics, as of the close on January 30, the average year-to-date increase for transformer concept stocks was 14.62, significantly outperforming the Shanghai Composite Index over the same period. Stocks like Yineng Power, China XD Electric, Sanbian Science & Technology, Baiyun Electric, and Shuangjie Electric were among the top gainers, with Yineng Power leading with a cumulative increase of 77.7%.
Regarding valuation levels, as of the closing price on January 30, there were 10 transformer concept stocks with a trailing price-to-earnings (P/E) ratio below 30 times. Among these, stocks like State Grid Yingda, Sanxing Medical, and Mingyang Electrical had trailing P/E ratios of less than 20 times. State Grid Yingda had the lowest trailing P/E ratio at 16.25 times. The company forecasts a net profit between 2.3 billion yuan and 2.75 billion yuan for 2025, representing a year-on-year increase of 46.1% to 74.69%. During the reporting period, the company strengthened governance, improved quality and efficiency, enhanced risk control, and promoted development, leading to steady growth in its main business; investment income and fair value change gains from the proprietary investment business of its financial segment increased significantly year-on-year. 8 Concept Stocks Forecast Profit Growth. Based on disclosed performance forecast data, and calculating using the lower limit of the projected net profit (or the announced figure if no lower limit is provided), 8 transformer concept stocks are expected to see year-on-year net profit growth for 2025 (including turning losses into profits). These include companies like Sinote, Shuangjie Electric, Jingquanhua, Jiuzhou Group, and Zhenyu Technology. Sinote expects a net profit between 40 million yuan and 50 million yuan for 2025, indicating a turnaround from a loss to a profit. During the reporting period, the company actively expanded the downstream application market for specialty transformers like those used in variable frequency drives, which helped revive its business; its energy storage business entered a track of healthy development, with losses narrowing significantly; the company overcame key technologies for medium-voltage, medium- and high-frequency transformers, achieving technical reserves that meet the most stringent electrical standards for applications such as solid-state transformers (SST), DC transformers, and fast-charging equipment. Shuangjie Electric forecasts a net profit between 170 million yuan and 200 million yuan for 2025, representing a year-on-year increase of 110.29% to 147.4%. During the reporting period, the company saw an increase in non-recurring gains and losses of approximately 110 million yuan due to fair value changes in its shareholding in Hebei Jinli New Energy Technology Co., Ltd. Jingquanhua expects a net profit between 80 million yuan and 92 million yuan for 2025, a year-on-year increase of 109.32% to 140.72%. During the reporting period, the company actively expanded its overseas business, with overseas market orders and sales revenue increasing compared to the same period last year, contributing positively to its overall operating performance. Simultaneously, the company deeply implemented cost-reduction and efficiency-improvement measures, strengthened cost control and expense optimization, effectively promoting profit growth.
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