Latest market data

Close	6.37 (-1.39% on the day; -1.09% over 5 sessions; -5.49% over 20 sessions)
Market cap	CNY 98.99 billion
P/E (TTM)	73.03x (11th percentile over 5.2 years)
P/B (MRQ)	1.79x (63th percentile over 5.2 years)
P/S (TTM)	0.73x (63th percentile over 5.2 years)
52-week range	6.32 (2026-07-20) – 11.21 (2025-10-10)
Moving averages	MA5 6.43 / MA10 6.47 / MA20 6.5 / MA60 6.62
MACD (12,26,9)	DIF -0.057, DEA -0.053, histogram -0.008
RSI	RSI6 31.7 / RSI14 39.4
Bollinger bands (20,2)	Upper 6.72 / middle 6.5 / lower 6.29
Volume	0.71x the 20-day average
One-week range (about 68% coverage)	6.21 – 6.49 (-2.5% ~ +1.9%)
One-week range (about 95% coverage)	6.1 – 6.78 (-4.2% ~ +6.4%)

As of the 2026-10-14 close; calculated from daily price data (adjusted prices) and refreshed automatically each trading day. The one-week range reflects historical volatility only and is not a forecast. The report below was written on 2026-10-14; its prices and short-term scenarios reflect data at that time.

Shanghai Electric Group Company Limited (601727)

Equity Research Report | Sector: Energy Equipment & Industrial Equipment | Report Date: October 14, 2026 | Quotes as of 2026-10-13 close

This report is automatically compiled and generated by AI based on public information, for reference only and does not constitute investment advice.

Core Conclusion: Revenue growth has not yet translated into non-recurring profit improvement; valuation still requires earnings realization for support

Quote data as of: 2026-10-13 close

1. Key Investment Points

• Revenue and net profit attributable to parent grew, but non-recurring improvement remains weak: In 2026H1, revenue and net profit attributable to parent grew 16.63% and 18.18% respectively, while non-recurring profit grew only 0.82%; single-quarter non-recurring profit fell 22.70% YoY.
• Energy equipment expansion is the main growth engine, but margins are under pressure: In 2025, energy equipment revenue grew 21.5%, accounting for approximately 56.1% of the three-segment revenue total, but gross margin fell 1.3 percentage points YoY; industrial equipment and integrated services revenue fell 1.5% and 0.4% respectively.
• Share price is in a low range, but valuation remains higher than most comparable companies: As of October 13 close at RMB 6.46, PE-TTM is 74.06x, at the 12th percentile over the past 5.2 years; the median PE of comparable companies in the valuation table is 21.33x.

Market Expectations and Evidence

• Market is pricing in: The consensus over the past six months is for 2026 net profit attributable to parent to grow 30.1% and 2027 to grow 44.8%; the 74.06x PE still requires earnings forecasts to be gradually realized. The market-implied growth rate is merely an arithmetic result under a low profit base and is not used for expectation comparison.
• Evidence shows: In 2026H1, revenue and net profit attributable to parent grew, but non-recurring profit only edged up and single-quarter non-recurring profit declined; earnings quality has not yet kept pace with the consensus annual growth rate; energy equipment revenue expansion alongside gross margin decline also indicates that profit conversion remains to be verified.

Evidence leans: Bearish; Confidence: High (key financial figures verified against official sources)

Revenue and orders provide growth support, but non-recurring profit is weak, gross margin is under pressure, and PE is relatively high compared to comparable companies.

2. Business and Competitiveness

2.1 Business Structure

Sells power generation, wind power, nuclear power, elevators and other equipment to energy and power enterprises, project owners and industrial users, and provides engineering services; revenue is affected by equipment and project scale, product mix and bidding pricing.

2.2 Competitive Advantages

Competitive Advantage Strength: Weak

• Products cover coal power, gas turbines, nuclear power, wind power, etc.; new orders in 2025 totaled RMB 172.8 billion, reflecting multi-domain project undertaking capability.
• 2025 R&D investment was RMB 6.251 billion with 3,966 R&D personnel; 24 nuclear island main equipment units were produced during the reporting period.
• Nuclear power equipment qualifications and manufacturing capabilities have barriers to entry, but the group's overall gross margin and net margin attributable to parent are low and volatile.

Main threats: Manufacturing costs are affected by material and component prices, and bidding limits price pass-through; engineering project costs, delivery and collection risks may erode profits.

2.3 Industry Chain Position and Profit Trends

• Equipment manufacturing inputs include metal materials, castings and forgings, electronic and electrical components, and supporting equipment; the annual report does not disclose the proportion of each type of procurement.
• In 2025, raw materials accounted for 84.9% of energy equipment costs and 82.5% of industrial equipment costs; procurement from the top five suppliers was RMB 5.823 billion, accounting for 5.65% of total procurement.
• Customers include energy and power enterprises, engineering project owners and industrial equipment users; large owners and general contractors have strong influence over bidding, acceptance, progress confirmation and settlement.
• Equipment and engineering projects are mostly priced through bidding, and manufacturers' bargaining power is constrained by competition; project acceptance and settlement cycles also affect collections.
• Disclosed in the 2025 annual report (single year): Sales to the top five customers were RMB 9.110 billion, accounting for 7.19% of annual sales; customer names were not disclosed, please refer to the company's annual report for details.
• As of end-2025, net accounts receivable were RMB 37.033 billion, approximately 29.4% of operating revenue; contract assets were RMB 37.741 billion, prepayments were RMB 11.502 billion, and accounts payable were RMB 70.637 billion, indicating significant project settlement occupation.

The company is positioned in the midstream of large-scale equipment manufacturing and engineering services, with overall margins affected by materials, components, project delivery and customer settlement. Margin improvement depends more on increasing the share of high-margin products, controlling engineering costs, improving collections and achieving scale-driven cost reduction, rather than simply expanding revenue.

2.4 Industry and Peer Comparison

Demand for large-scale energy equipment is driven by power investment and energy transition projects, but manufacturing and engineering businesses remain constrained by material costs, bidding pricing and project execution; Shanghai Electric's energy equipment revenue grew in 2025, yet group gross margin fell YoY.

Shanghai Electric has broad product and project coverage, with outstanding nuclear power equipment manufacturing capability and multi-domain undertaking capability; however, the group's profit margin is not high, and its business span is wider than any single peer, making the impact of material costs and engineering project execution on profitability more complex.

3. Financial Quality

3.1 Operating Performance

Operating revenue and net profit attributable to parent are presented per the official statements for the same periods and in explicit currency; adjusted earnings and statutory profit are compared separately. The table contains 6 items for operating revenue and net profit attributable to parent, all 6 of which were verified item-by-item against the issuer's periodic report originals. YoY growth rates were derived from the original current and prior period figures, totaling 6 items, all 6 consistent with the table.

2026H1 net profit attributable to parent grew faster than non-recurring profit, with non-recurring profit up only 0.82% YoY; single-quarter non-recurring profit fell 22.70% YoY, and the endogeneity of profit growth remains to be observed. In 2025, the gap between net profit attributable to parent and non-recurring net profit was large, indicating significant contribution from non-recurring gains and losses.

3.2 Financial Health Check

4. Valuation and Market Expectations

4.1 Valuation Level

Valuation multiples calculated by program based on 2026-10-13 close data (trailing twelve months basis); peer multiples calculated on the same basis using 2026-10-13 close data

Market-implied expectations: At the current 74.06x PE, if investors require an 8% annualized return and a 15x PE valuation after 10 years, EPS would need to grow at approximately 26.7% annually (excluding dividends, conservative). The current profit base is low and the PE is distorted; this growth rate is merely an arithmetic result and should not be taken directly as market expectation.

PE-TTM of 74.06x is at the 12th percentile over the past 5.2 years, below its own median of 150.9x but above the comparable company median of 21.33x; PB of 1.81x and PS of 0.74x are both at the 64th percentile of their own history, above its own PB median of 1.29x and below the comparable PS median of 1.0x, respectively. Market prices still require earnings realization, but the implied growth rate under a low base should not be regarded as an effective expectation.

4.2 Consensus Estimates

East Money consensus over the past six months, as of 2026-10-14. Institutional research details available; rating counts are separate: 2026E net profit 3 firms, EPS 3 firms; 2027E net profit 3 firms, EPS 3 firms; 2028E net profit 3 firms, EPS 3 firms

4.3 Institutional Views

2 firms over the past six months, average target price RMB 9.28, range RMB 8.55–10; latest from Huatai Securities on 2026-09-01, target price RMB 8.55.

5. Catalysts and Recent Events

5.1 Key Upcoming Milestones

5.2 Recent Important Events

• 2026-10-08 Planning A-share private placement to specific investors (Neutral): The company plans to issue A-shares to no more than 35 specific investors, still in the preliminary planning stage, with issuance size and price undisclosed. Subsequent steps require board, shareholder meeting, state-owned asset approval, exchange review and CSRC registration; the pace of progress and dilution impact remain to be clarified.
• 2026-09-02 China Energy loan case received first-instance judgment (Neutral): The company obtained a first-instance judgment regarding litigation related to two loans, ordering the defendant to pay interest, penalty interest, etc., and provide pledged equity guarantees; the judgment is not yet effective and the defendant may appeal, so collection and profit/loss impact remain uncertain.
• 2026-08-31 Interim report disclosed large impairment losses (Bearish): The interim report disclosed credit impairment losses and asset impairment losses totaling approximately RMB 1.791 billion reduction in pre-tax profit, reflecting receivable and inventory impairment pressure; net profit attributable to parent growth failed to eliminate asset quality risks.

6. Bull-Bear Debate and Risks

6.1 Bull Case

• New orders in 2025 totaled RMB 172.8 billion, with products covering coal power, gas turbines, nuclear power and wind power; multi-domain undertaking capability can support future revenue.
• Institutional consensus expects 2026 and 2027 net profit attributable to parent to grow 30.1% and 44.8% respectively; if project delivery and cost control are realized, profit elasticity may improve.
• 2025 R&D investment was RMB 6.251 billion with 24 nuclear island main equipment units produced; nuclear power equipment qualifications and manufacturing capabilities constitute barriers in the niche business.

6.2 Bear Case

• 2026H1 non-recurring profit grew only 0.82% and fell 22.70% in the single quarter; net profit attributable to parent growth has not yet manifested as stable endogenous profit improvement.
• Raw materials account for 84.9% of energy equipment costs and 82.5% of industrial equipment costs; combined with bidding pricing constraints, material price increases may continue to squeeze gross margin.
• PE-TTM of 74.06x is above the comparable company median of 21.33x; if consensus estimates are not realized, valuation downside could be significant.

6.3 Other Risks

• Planned A-share issuance to no more than 35 specific investors, with size and price undisclosed; the issuance may dilute EPS and affect valuation.
• The China Energy loan case judgment is not yet effective and may be appealed; collection uncertainty will extend capital occupation and bring profit/loss volatility.
• Debt-to-asset ratio of 75.74% and inventory turnover of 256.4 days; if inventory realization or project settlement slows, capital occupation and impairment pressure may rise.

7. Tracking Checklist

8. Share Price and Short-Term Outlook (Next Week, Scenario Analysis, For Reference Only)

⚠️ Risk Warning: The following is subjective scenario analysis; weights are not statistical probabilities; does not constitute investment advice.

8.1 Technical Overview

Share price is near MA5 and below the Bollinger middle band, and below MA10, MA20 and MA60; MACD histogram just turned positive and RSI is not oversold; short-term focus remains on support confirmation and moving average recovery.

8.2 Key Price Levels

8.3 One-Week Range Estimated by Historical Volatility

Using the 2026-10-13 price of RMB 6.46 as the base, the range of closing prices over the next 5 trading days is estimated using the return distribution over the past 300 trading days (scaled by the current index-weighted daily volatility of approximately 1.2%, retaining the stock's own frequency of large gains and losses):

This range only reflects the stock's recent volatility magnitude, without directional judgment; in the event of major announcements or sharp market declines, actual movements may still exceed the range.

8.4 Next Week Scenarios (Subjective Weights, Not Statistical Probabilities)

• Consolidation (relatively high weight, approx. 40%): RMB 6.32–6.52; consolidation continues if recent lows are held but MA20 is not effectively recovered. Based on historical volatility, the probability of a close in this range after one week is approximately 50%.
• Weak Downside (medium weight, approx. 40%): RMB 6.29–6.32; if the close breaks below recent lows and remains pressured below MA5, watch near the Bollinger lower band. Based on historical volatility, the probability of a close in this range after one week is approximately 5%.
• Rebound Strengthening (relatively low weight, approx. 20%): RMB 6.52–6.79; after recovering MA20 on volume, watch resistance near recent highs. Based on historical volatility, the probability of a close in this range after one week is approximately 25%.

Figures in parentheses are subjective weights; probabilities at the end of sentences are derived from the volatility ranges above and reflect only volatility magnitude, not directional judgment.

8.5 Capital and Liquidity

As of 2026-10-13, daily turnover over the past 10 trading days was approximately RMB 190–736 million, with turnover rate of 0.23%–0.88%. As of 2026-06-30, the top ten tradable shareholders held a combined 68.14%, mainly controlling shareholders, the company and investment companies; no public funds, social security or QFII appear on the list; shareholder data has disclosure lag and the structure may have changed. Under lower turnover, short-term large transactions may increase trading impact.

If single-day turnover exceeds RMB 736 million and the share price recovers RMB 6.52, it can be regarded as a confirmation signal of strengthening volume and price.

The above scenario analysis is based on 2026-10-13 close data and historical prices and technical indicators; short-term share prices are also subject to multiple disturbances including news, capital flows and the broader market environment; technical indicators themselves have lag and limitations, do not constitute a guarantee of future actual movements, and do not constitute buy or sell recommendations. Please make independent judgments based on the latest market information and bear investment risks yourself.

Shanghai Electric Group Company Limited

2024 ANNUAL RESULTS ANNOUN](https://www.shanghai-electric.com/listed/upload/resources/file/2025/06/09/112100.pdf)

• Shanghai Electric 2026 Interim Report
• Shanghai Electric 2025 Annual Report
• Shanghai Electric 2024 Annual Report
• Shanghai Electric 2023 Annual Report
• Tencent Finance Quotes (2026-10-14)
• East Money F10 Consolidated Balance Sheet (2026 Interim)
• East Money F10 Earnings Forecast
• Shanghai Electric: Shanghai Electric 2026 Interim Report
• Shanghai Electric Group Company Limited Announcement on Progress of Subsidiary Litigation
• China Securities Journal - Shanghai Electric Group Company Limited<BR/>Announcement on Planning Private Placement of A-Shares
• Shanghai Electric: Subsidiary's RMB 544 Million Payment Lawsuit Finally Withdrawn
• Shanghai Electric Latest Announcement: Planning Private Placement of A-Shares - Stockstar
• Shanghai Electric: Planning Private Placement of A-Shares_9fzt
• Shanghai Electric: Planning Private Placement of A-Shares
• Shanghai Electric: Planning Private Placement of A-Shares
• Shanghai Electric Subsidiary's RMB 544 Million Litigation Withdrawn by Plaintiff; Related Matter Was Previously Suspended
• East Money Individual Stock Capital Flows
• East Money Shareholder Research

Sources

• 上海电气(601727)_公司公告_上海电气：2025年年度报告新浪财经_新浪网
• 上海电气(601727)_公司公告_上海电气：2025年年度报告摘要新浪财经_新浪网
• 上海电气风电集团股份有限公司2025年年度报告摘要|上海证券报
• 上海电气集团股份有限公司关于上海证券交易所对公司2022年年度报告的信息披露监管工作函的回复公告|上海证券报
• 公司公告_上海电气：上海电气2021年年度报告新浪财经_新浪网
• 公司公告_上海电气：2022年年度报告摘要新浪财经_新浪网
• 上海电气：2023年盈利2.85亿元 同比扭亏|上海电气_新浪财经_新浪网
• [2024年度业绩发布

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This report is automatically retrieved, compiled and generated by AI based on public channel information, with information as of the 2026-10-13 close; timeliness differences may exist, and specific data should be subject to the company's official announcements and authoritative data terminals. This report is for information compilation and research reference only, does not constitute any investment advice, and investors should make independent judgments and bear investment risks themselves.