Nuclear power industry investment opportunity restart

On April 18, Premier Li Keqiang presided over the first meeting of the National Energy Commission. The meeting emphasized that under the current pressure of economic downturn, it is necessary to start construction of a number of major projects, including timely launching of new nuclear power key projects in the eastern coastal areas, orderly start of reasonable hydropower projects, and start construction of a batch of special projects according to plans. High-voltage and conventional technologies, such as the “West-to-East Power Transmission” transmission channel, etc. Thanks to this positive news, the wind nuclear power index has risen in a contrarian trend of 0.05%, and has become the only two concept of redemption on that day. One of the indices.

Policy Boosts Nuclear Power to Restart Development and Enter the Fast Track

China is currently facing huge pressures for carbon emission reduction. Nuclear power has the advantages of being highly efficient and stable, energy-saving and emission-reducing, flexible site selection, and good economic effects.

Prior to the accident at the Fukushima nuclear power plant, China had established the goal of “accelerating the development of nuclear power” and set off a “nuclear power fever”. However, after the approval of all new nuclear power projects in China was halted urgently, and the construction projects underwent a thorough safety inspection. Nuclear power industry chain companies faced “order panic” and the industry was once in a state of stagnation.

Until the “Nuclear Power Safety Planning (2011-2020)” and “Nuclear Power Medium-to-Long-Term Development Planning (2011-2020)” adopted by the State Council in October 2012, it was clearly stated that the normal construction and objectives of nuclear power should be restored. In January of this year, the National Energy Administration issued the “Guidelines for Energy Work in 2014” and proposed the timely approval of key nuclear power project approvals, steadily promoting the construction of nuclear power in coastal areas, and ensuring the protection of nuclear power plant sites in inland areas. The government work report showed that the development of nuclear power projects and the promotion of nuclear power project technology and equipment to go abroad, and further from the national level issued a nuclear power restart signal.

At the same time, nuclear power projects that have been suspended for approval have also been approved or re-started. This has also verified that the nuclear power industry has ushered in a substantial restart.

Analysts pointed out that the nuclear power industry has ushered in a trend of warming, and will enter the fast lane of development, related companies are expected to usher in the performance blowout. First of all, according to the planning of the Energy Bureau, the newly installed capacity of national nuclear power in 2014 was about 8.64 million kilowatts, which was 2-3 times that of the same period of 2013. Secondly, after the restart of nuclear power construction, there are many follow-up construction reserve projects, which are sufficient to support future development; finally, “ During the 13th Five-Year Plan period, inland nuclear power projects are expected to gradually release. While accelerating domestic construction, with the implementation of the “going out” strategy for nuclear power, the opening of the export market will bring about a rapid release of operating performance, and the industry and even the growth of the leading companies will open up further.

Significant economic benefits Short-cycle equipment has more investment value

In addition to the obvious environmental benefits, nuclear power generation projects are also very significant.

On the one hand, the nuclear power plant has a high return on investment. According to calculations by Shenyin Wanguo Researcher, according to the new national nuclear power benchmark price of 0.43 yuan/kWh, a 1 million kilowatt nuclear power unit with a unit kilowatt cost of about 13,000 yuan will be generated annually. With a utilization hour of about 7000-8000 hours, the unit's 1 degree power generation profit is about 0.09 yuan/kWh, and the ROE level is nearly 26%, far higher than the ROE level of coal-fired power and hydropower.

On the other hand, since nuclear power is a key development target in China's environmental protection and clean energy, the completion of nuclear power projects can bring higher economic and environmental benefits. Therefore, the central and local governments have successively introduced a number of preferential policies to support and support nuclear power projects. You can enjoy multiple national and local tax benefits.

According to relevant statistics, the number of nuclear power projects that have been put into commercial operation and the number of new projects started in 2014 and 2015 reached a peak. In 2014, 6-8 new projects were started, which doubled compared to 2013, and are expected to surpass the previous nuclear power. "We welcome the second spring of the industry. At the same time, the acceleration of nuclear power project construction will drive the country to invest 72 billion to 96 billion yuan annually, of which 50% will be equipment investment.

Analysts pointed out that with the acceleration of the process of nuclear power quality asset securitization, the restart of nuclear power will lead to decentralization of orders and stimulate the valuation of the entire industry. Specifically, the nuclear power industry can mainly grasp four main lines, namely nuclear islands, conventional islands, gas-water separation and auxiliary equipment.

Although the main equipments such as nuclear islands and conventional islands belong to long-period equipment in the order of actual income, the revenue returns are earlier than those of short-cycle equipment such as auxiliary equipment. However, in terms of order flexibility, long-period products generally need to be started in advance18 More than one month of tender; and short-cycle equipment bidding is basically synchronized with the start of the project. The pre-accumulation projects started in the second half of 2013 and early 2014, and their order release was postponed. Most of them will be released in 2014. The current long-cycle equipment for restarting the project has already been tendered before 2011, and the flexibility of new orders after the restart is limited. However, short-cycle equipment is basically synchronized with the start of new projects. Therefore, the apparent recovery in the number of nuclear power starts will enhance the relative deterministic growth of short-cycle equipment companies' orders for the past 1-2 years, and in the short term, it will have more investment value.