According to Orient Securities, lithium battery equipment manufacturers have secured contracts as downstream players continue expanding production. Recently, Naknorr (832522.BJ), a machinery equipment company, announced a procurement contract worth RMB 301 million with a leading domestic client for roll-press slitting machines. The firm views Naknorr's recent order as evidence of ongoing capacity expansion by battery manufacturers. Key insights from Orient Securities include:
1. **Energy Storage Demand Drives Expansion, Lithium Equipment Sector's 2026 Outlook Strengthens** Energy storage demand is growing rapidly, with China's new energy storage project tenders exceeding 400GWh from January to November 2025—a 75% YoY increase. Large-scale projects are accelerating. The government’s *2025–2027 Large-Scale Energy Storage Development Action Plan* targets over 180GW of installed capacity by 2027, attracting ~RMB 250 billion in direct investments. Overseas, data center power needs are boosting demand; for example, LG Energy Solution plans to raise its energy storage battery capacity from 30GWh to 50GWh by 2026 (a 60% increase). Orient expects lithium equipment orders to grow significantly in 2026 amid global capacity expansion.
2. **New Orders Likely as Downstream Expansion Progresses** Lithium equipment orders rebounded sharply in 2025, reflecting active downstream expansion. Per GGII data, leading firms like Lead Intelligent, Hymson, Yinghe Technology, and Liyuan Heng reported new and backlogged orders exceeding RMB 30 billion in H1 2025, up 70%–80% YoY. With major players continuing to expand, Orient anticipates sustained order placements, reinforcing sector growth visibility and investment opportunities.
**Investment Recommendation** Orient highlights large contracts secured by equipment manufacturers as indicative of expansion driven by energy storage demand. Improved profitability in the sector and expected order momentum enhance growth certainty. Key beneficiaries include Lead Intelligent, Honggong Technology, Hymson, Naknorr, and Liyuan Heng.
**Risks**: Macroeconomic volatility, slower overseas data center growth, trade tensions, rising material costs, and technological delays.
