Harbin Electric (1133.HK): Probably the Most Undervalued PRC Major Power Equipment Play

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Harbin Electric (1133.HK): Probably the Most Undervalued PRC Major Power Equipment Play

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27 Jul 2026 11:07:12 ET │ 20 pages

Harbin Electric (1133.HK)

Probably the Most Under-Valued PRC Major Power Equipment Play

CITI'S TAKE

Our Harbin Electric (HE) 2026-28E net profits are raised 2-8% on higher

revenue and margins after the 1H26 results beat. We reiterate our Buy rating

on HE for (i) being a prime beneficiary of more PRC hydro and nuclear Buy

capacity additions in 15th 5-year period with >40% and one-third market Price (27 Jul 26 16:10) HK$16.14

shares; (ii) the company’s confidence in rising profit momentum with more

from hydro and nuclear to offset less from coal; (iii) attractive 8.3x 2027E Target price HK$24.00↓

PER, 1.4x PB & 3.8% yield. Our TP is conservatively lowered 20% to HK$24, from HK$30.00

or 12x 2027E PER. We transfer coverage of HE to Pierre Lau from Bella Tian. Expected share price return 48.7%

Expected dividend yield 3.6%Positive 1H26 profit alert — HE issued a positive profit alert on 20 July 2026 guiding

its net profit to be ~Rmb1,700m in 1H26, +62% yoy from Rmb1,050m in 1H25, with Expected total return 52.3%

both revenue and margin increments. Based on our update with the company, the Market Cap HK$36,093M

better-than-expected 1H26 results were primarily driven by recurrent revenue and

US$4,602Mmargin improvements. Its detailed 1H26 results will be released by end August.

Gaining ground from PRC’s ambitious hydro and nuclear targets — Based on PRC’s

15th five-year plan, we project PRC hydropower (=conventional hydropower + pump

storage) capacity to rise 27% from 448GW by end 2025 to 569GW by end 2030E. Price Performance

PRC nuclear capacity would be lifted 52% from 69GW by end 2025 to 105GW by end (RIC: 1133.HK, BB: 1133 HK)

2030E.