摩根士丹利-深海转型重塑中国海上风电格局-Deepwater shift rewires China offshore wind-20261011

October11,202610:42PMGMT

ChinaWind|AsiaPacific

DeepwatershiftrewiresChinaoffshorewind

WeexpectChina’soffshorewindsectortoenteranewgrowthcycle,withdeepandfar-offshorewinddevelopmentacceleratingfrom2027onwardandaverageannualconstructionstarts

exceeding20GW,vs.5-8GWp.a.during2022-25.

KeyTakeaways

WeexpecttheDeepandFar-OffshoreWindDevelopmentActionPlanwilllikelytobereleasedin4Q26.

OurChiefChinaeconomist,RobinXing,believespolicymakersmayaccelerateenforcementofthepowergridnetworkandnewoffshorewinddevelopment.

Weexpectoffshorewindapprovals,aswellasequipmentandengineeringtenderstoacceleratein4Q26upontherolloutoftheActionPlan.

Deep&far-offshorewindcapexisexpectedtodeclinetoRmb11,500-13,000/kWby2030,drivenbymarineengineering,foundationandtransmissionoptimization.

Deepandfar-offshoredevelopmenttoreshapeinvestmentopportunities:China'soffshorewindsectorisshiftingfromindividualnearshoreprojectstowardlarge-

scaledeepandfar-offshorewindbases.AccordingtoHydroChina,averagecapexforfixed-bottomdeepandfar-offshorewindisexpectedtodeclinefromRmb14,000–18,000/kWin2025toRmb11,500–13,000/kWby2030.Weexpectfuturecost

reductionstobeincreasinglydrivenbyfoundationdesign,marineengineering,

installationefficiencyandtransmission-systemoptimization,ratherthanturbine

prices.Webelievetheseimprovementswillenhanceprojecteconomicsandsupporttheoffshorewinddevelopmentduringthe15thFive-YearPlan(2026-30).

Policycatalystpotentiallyarrivingin4Q26:WeexpecttheDeepandFar-OffshoreWindDevelopmentActionPlantobereleasedin4Q26,potentiallyremovingakeybottlenecktooffshorewinddevelopment.Weexpecttheplantoclarifythe

approvalframeworkforprojectsincentrallyadministeredwaters,includingsea-userights,militaryclearanceandcross-agencycoordination.Webelievegreaterpolicyclaritycouldunlockdelayedprojectsandaccelerateconstructionactivityfrom2027.

Astrongerconstructioncycleahead:Chinatargets~100GWofnewoffshorewindconstructionstartsinthe15thFYP.Weestimateannualconstructionstartscould

exceed20GWin2027–30,vs.5–8GWp.a.in2022–25andonly2-3GWin9m26.Weforecastannualoffshorewindinstallationswillincreasefrom9GWp.a.in2026–27to15GW/20GW/25GWin2028/29/30.

Implications:WefavoroffshorewindsupplychaincompaniesincludingleadingsubseacablesupplierNingboOrientandZhongtian(alsomarineengineeringandinstallation),aswellasleadingfoundationsupplierDajin.

Idea

MorganStanleyAsiaLimited+

EvaHou

EquityAnalyst

Eva.Hou@+8522848-6964

RobinXing

ChiefChinaEconomist

Robin.Xing@+8522848-6511

ZhipengCai

Economist

Zhipeng.Cai@+8522239-7820

TomLi

EquityAnalyst

Tom.Li1@+8522239-1059

ChinaUtilities

AsiaPacific

IndustryViewAttractive

MorganStanleydoesandseekstodobusinesswith

companiescoveredinMorganStanleyResearch.Asaresult,investorsshouldbeawarethatthefirmmayhaveaconflictofinterestthatcouldaffecttheobjectivityofMorganStanley

Research.InvestorsshouldconsiderMorganStanley

Researchasonlyasinglefactorinmakingtheirinvestmentdecision.

Foranalystcertificationandotherimportantdisclosures,refertotheDisclosureSection,locatedattheendofthisreport.

+=Analystsemployedbynon-U.S.affiliatesarenotregisteredwithFINRA,maynotbeassociatedpersonsofthememberandmaynotbesubjecttoFINRArestrictionson

communicationswithasubjectcompany,publicappearancesandtradingsecuritiesheldbyaresearchanalystaccount.

2

Idea

ChinaOffshoreWindEntersaDeep&Far-OffshoreDevelopmentCycle

Chinaaimstopromotethestandardizedandorderlydevelopmentofoffshorewindpower,accordingtothe15thFive-YearRenewableEnergyPlan.ThePlanmarksastrategicshiftinoffshorewinddevelopmentfrompredominantlynearshore,project-by-project

developmenttowardlarge-scaledeepandfar-offshorewindbases.Thegovernmenttargets~100GWofnewoffshorewindconstructionstartsduring2026–30,with

cumulativeinstalledcapacityexceeding100GWby2030.Asend-2025,China'soperationaloffshorewindinstalledcapacitywas47GW.

•Nearshoreremainsimportant,butdeep&far-offshorewillbecomethenext

growthpillar:Thegovernmenttargetstoacceleratetheconstructionofprovincialoffshorewindpowerprojectsthathavealreadyreceivedapproval,andcarryoutanewroundofrevisionsandassessmentsofprovincialoffshorewindpowerplans.

•Developmentmodelshiftsfromindividualprojectstowardlarge-scaleoffshorewindbases:ThePlancallsforanationalpipelineofdeepandfar-offshorewind

basesacrosstheBohaiSea,YellowSea,EastChinaSeaandSouthChinaSea.

•Gridconnectionbecomesincreasinglycentralizedandshared:Italsoemphasizescoordinatedgenerationandtransmissionplanning,sharedsubseatransmission

corridorsandlandfallinfrastructure,aswellasthelonger-termdevelopmentofintegratedoffshoreenergyhubsandenergyislands.

China’soffshorewindmarkettoenterastronger

constructioncyclefrom2027

Offshorewindconstructionactivityremainedrelativelysubduedfortheninemonths

endingSeptember2026,withonly2-3GWofnewprojectscommencingconstruction,

mainlyincluding1.2GWinGuangdong,0.3GWinJiangsuand1.2GWinHainan.Onekey

factorwasthedelayintheDeepandFar-OffshoreWindDevelopmentActionPlan,whichhadinitiallybeenexpectedtobereleasedalongsidethe15thFive-YearRenewableEnergyDevelopmentPlaninMarch2026.Thedelayedrolloutoftheactionplanhasslowedtheapprovalandconstructionscheduleforanumberofdeepandfar-offshoreprojects.Weexpectprojectapprovalsandconstructionstartstoacceleratemeaningfullythereafter,oncetheActionPlanisreleased,potentiallyin4Q26.

TheDeepandFar-OffshoreWindDevelopmentActionPlan,whichhasbeenunder

preparationformorethantwoyears,isexpectedtoestablishaclearerdevelopmentandapprovalframeworkforprojectsincentrallyadministeredwaters,addressingkey

bottlenecksincludingsea-userights,projectapprovals,militaryclearanceandcross-agencycoordination.

Weestimateannualnewconstructionstartscouldexceed20GWduring2027–30,a

substantialincreasefrom5-8GWp.a.during2022-25,supportedbytherolloutofdeepandfar-offshorewindbasesaswellasanewwaveofprovincialoffshorewindprojects.Thiswouldimplymorethan100GWofcumulativenewoffshorewindconstructionstartsduringthe15thFive-YearPlanperiod,broadlyconsistentwiththenationaltargetof

Idea

approximately100GWofnewoffshorewindprojectscommencingconstructionduring2026–30.

WeforecastChina'soffshorewindinstallationwillincreaseto15GW/20GW/25GWin2028/29/30,from9GW/9GWin2026/27,benefitingfromtheaccelerationofapprovalandconstructionoflarge-scaledeepandfar-offshorewindbases.Ournewinstallationforecastsfor2026and2027arebasedontheunder-constructionprojectpipeline.

Exhibit1:China'soffshorewindnewinstallationforecasts,2026-30

China'snewoffshorewindinstallation(GW)

25

20

15

10

5

0

25

20

17

15

99

7

7

44

4

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026E

2027E

2028E

2029E

2030E

2

Source:NEA,MorganStanleyResearch;E=MorganStanleyResearchestimates

Deep&far-offshorewindinvestment:Costreductionsshiftingfromequipment-ledtomarineengineering-andsystem-ledoptimization

China’soffshorewindsector,historicallyfocusedonnearshoreprojects,experienced

substantialcostreductionsduringthe14thFive-YearPlan(2021–2025),drivenby

technologicaladvancements,improvedinstallationcapabilities,largerwindturbines,andintensifiedsupplychaincompetition.AccordingtoHydroChina,thescopeforfurthercostreductionsinnearshoreoffshorewindisbecomingincreasinglylimited,withaveragecapexexpectedtodeclinemodestlyfromRmb9,500/kWin2025toRmb7,500–9,000/kWby

2030.

MorganStanleyResearch3

4

Idea

Exhibit2:Investmentcostofnearshoreoffshorewindhasdeclinedovertheyear

Unitnearshoreoffshorecapex(Rmb/kW)

25000

20000

15000

10000

5000

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2030E

21,500

19,200

16,800

17,500

16,200

17,800

18,200

15,000

16,800

9,000

15,500

14,900

10,540

9,500

11,500

10,000

Historical

2030ELow

2030EHigh

7,500

Source:HydroChina,MorganStanleyResearch;E=HydroChinaforecast.

Exhibit3:Higherinvestmentcostofdeepandfaroffshorewind;anticipatingdeclineduring15thFYP

Unitdeepandfaroffshorecapex(RMB/kW)

17000

15500

14000

18500

18,000

14,000

13,000

12500

11,500

11000

20252030E

LowHigh

Source:HydroChina,MorganStanleyResearch;E=HydroChinaforecast.

Offshorewindturbineprices(includingtower)stoodatRmb2,950–3,300/kWin2025vs.>Rmb7,000/kWin2021(Exhibit4).Asthemarginalcostbenefitsofturbineupsizing

diminish,constructionefficiencyandriskmanagementarebecomingincreasinglyimportantdeterminantsofoverallprojecteconomics.

Exhibit4:WeseelimiteddownsideforoffshorewindturbineASP

(Rmb/kW)OffshoreWTGtender(towerincl.)

5,000

4,500

4,000

3,500

3,000

2,500

Jan-22

Mar-22

May-22

Jul-22

Sep-22

Nov-22

Jan-23

Mar-23

May-23

Jul-23

Sep-23

Nov-23

Jan-24

Mar-24

May-24

Jul-24

Sep-24

Nov-24

Jan-25

Mar-25

May-25

Jul-25

Sep-25

Nov-25

Jan-26

Mar-26

Source:CWEC,MorganStanleyResearch;Note:OffshorewindturbineASPwas>Rmb7,000/kWin2021.

Duringthe15thFive-YearPlan(2026–2030),HydroChinaexpectsChina'soffshorewinddevelopmenttoshifttowardsdeeperwatersandlocationsfartheroffshore,where

projectcostsremainstructurallyhigher.AccordingtoHydroChina:

•Everyadditional10kmofoffshoredistanceincreasesconstructioninvestmentby8–12%undernearshoreACtransmissionconfigurations.

•Meanwhile,aswaterdepthincreasesfrom15mto45m,foundationandsupportstructurecostsrisesubstantiallyfromapproximatelyRmb3,000/kWto

MorganStanleyResearch5

Idea

Rmb7,000/kW.

Despitethesechallenges,HydroChinaexpectsaveragecapexforfixed-bottomdeepwaterandfar-offshorewindprojectstodeclinefromRmb14,000–18,000/kWin2025to

Rmb11,500–13,000/kWby2030,supportedbyadvancesinoffshoreconstruction,foundationdesign,installationefficiency,andtransmissionsystemoptimization.

Weexpectcostoptimizationtoincreasinglyshiftfromturbinepricereductionstowardfoundationdesign,marineengineering,installationefficiencyandtransmission-systemoptimization,supportingthelonger-termscalabilityofoffshorewinddevelopment.

Exhibit5:OffshorewindconstructionunitcostbreakdowninChina:Windturbinescostdroppedsubstantially,whilesubseacables,foundationandmarineengineeringincreased

20192025

JiangsuGuangdongFujianNationalaverage

Investmentcost(Rmb/kW)

14,400-16,300

16,200-17,600

17,300-18,500

9,500

Breakdown(%)

Windturbine(Incl.installation)Windtower

Foundationandengineering

220/500kVexportsubmarinepowercable*

35/66kVinter-arraysubmarinepowercable*

Offshoresubstation

Onshoresubstationandcontrol

center

Sea(land)costOthers

48%

4%

19%

8%

3%

6%

1%

4%

7%

43%

4%

24%

8%

3%

3%

2%

3%

10%

30%

5%

25%

11%

45%

5%

25%

8%

4%

8%

2%

4%

11%

3%

3%

2%

3%

6%

Source:HydroChina,MorganStanleyResearch;Note:500kVand66kVsubseacablesrefersto2025.

6

Idea

ValuationMethodologyandRisks

DajinHeavyIndustry(002487.SZ)

Basecase,DCFmethodology.Ourmodelcaptureslong-termcashflowsover2027-37e.WeapplyaWACCof8.2%,reflectingaCoEof9.7%(basedonabetaof1.2,arisk-freerateof2.1%,anequityriskpremiumof4.5%,andaChinapremiumof2.0%),aswellasanafter-taxCoDof4.5%,andatargetdebt-to-capitalratioof40%.Ourterminalgrowthrateis1%.

RiskstoUpside

Better-than-expectedoffshorewindinstallationsinEuropeandChina,supportingastrongerdemandrunway

Betterorderintake,drivenbyfasterprojectrolloutsandapprovals

BetterGPmargin,supportedbystablerawmaterialprices

RiskstoDownside

Weaker-than-expectedoffshorewindinstallationsinEuropeandChina

Greaterrawmaterialpricevolatility

ProjectexecutiondelaysinoffshorewindprojectsinEuropeJiangsuZhongtianTechnologyCo.Ltd.(600522.SS)

Basecase,discountedcashflowmodel,whichcaptureslong-termcashflowsfor2027-37.Keyassumptions:

WACCof9.67%-CoEof10.55%(betaof1.2,risk-freerateof3.15%,riskpremiumof4.5%,Chinapremiumof2.0%);after-taxCoDof5.25%;targetdebttocapitalratioof20.0%

2%terminalgrowth

RiskstoUpside

RevenueaccelerationinopticalI&Csegment,amidASPboostforopticalfiber

Higheroffshorewindsubmarinecablepenetrationinoverseasmarkets(especiallyEurope)

Better-than-expectedoperatingcostmanagement

RiskstoDownside

Lower-than-expectedopticalI&Crevenuegrowth

Subparorderintakeofsubmarinecableinoverseasmarkets

Subparoperatingcostmanagement

NingboOrientWires&CablesCoLtd(603606.SS)

WeusediscountedcashflowanalysistovalueOrientWires&Cablestocapturelong-termcashflowsfor2027-37.WeuseaWACCof7.4%,whichreflectsaCoEof8.6%,usingabetaof1.0,arisk-freerateof2.1%,ariskpremiumof4.5%,aChinapremiumof2.0%,anafter-taxCoDof4.5%,atargetdebt-to-capitalratioof40%,and2%terminalgrowth.

RiskstoUpside

MorganStanleyResearch7

Idea

HigherChinaoffshorewindpowerinstallations

HighersubmarinecableASPs

BetterGPmarginsforbothsubmarineandlandcables

RiskstoDownside

LowerChinaoffshorewindpowerinstallations

HigherASPdeclineinsubmarinecables

Unexpectedandrapidincreasesinrawmaterialcosts

8

Idea

DisclosureSection

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Thefollowinganalystsherebycertifythattheirviewsaboutthecompaniesandtheirsecuritiesdiscussedinthisreportareaccuratelyexpressedandthattheyhavenotreceivedandwillnotreceivedirectorindirectcompensationinexchangeforexpressingspecificrecommendationsorviewsinthisreport:EvaHou;TomLi.

.

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MorganStanleyResearchhasbeenpublishedinaccordancewithourconflictmanagementpolicy,whichisavailableat

/institutional/research/conflictpolicies.A

Portugueseversionofthepolicycanbefoundat.br

ImportantRegulatoryDisclosuresonSubjectCompanies

AsofSeptember30,2026,MorganStanleybeneficiallyowned1%ormoreofaclassofcommonequitysecuritiesofthefollowingcompaniescoveredinMorganStanleyResearch:AnhuiYingliuElectromechanicalCoLtd,HenanPinggaoElectric,HuamingPowerEquipment,JASolarTechnologyCoLtd,LONGiGreenEnergyTechnologyCoLtd,SieyuanElectricCo.Ltd.,SungrowPowerSupplyCo.Ltd.

Inthenext3months,MorganStanleyexpectstoreceiveorintendstoseekcompensationforinvestmentbankingservicesfromAnhuiYingliuElectromechanicalCoLtd,ChinaGasHoldings,ChinaResourcesGas,ChinaResourcesPower,SungrowPowerSupplyCo.Ltd,TongweiCo.Ltd..

Withinthelast12months,MorganStanleyhasreceivedcompensationforproductsandservicesotherthaninvestmentbankingservicesfromChinaGasHoldings,ChinaLongyuanPowerGroup,HuanengPowerInternationalInc..

Withinthelast12months,MorganStanleyhasprovidedorisprovidinginvestmentbankingservicesto,orhasaninvestmentbankingclientrelationshipwith,thefollowingcompany:AnhuiYingliuElectromechanicalCoLtd,ChinaGasHoldings,ChinaResourcesGas,ChinaResourcesPower,SungrowPowerSupplyCo.Ltd,TongweiCo.Ltd..

Withinthelast12months,MorganStanleyhaseitherprovidedorisprovidingnon-investmentbanking,securities-relatedservicestoand/orinthepasthasenteredintoanagreementtoprovideservicesorhasaclientrelationshipwiththefollowingcompany:ChinaGasHoldings,ChinaLongyuanPowerGroup,HuanengPowerInternationalInc..

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STOCKRATINGS

MorganStanleyusesarelativeratingsystemusingtermssuchasOverweight,Equal-weight,Not-RatedorUnderweight(seedefinitionsbelow).MorganStanleydoesnotassignratingsofBuy,HoldorSelltothestockswecover.Overweight,Equal-weight,Not-RatedandUnderweightarenottheequivalentofbuy,holdandsell.InvestorsshouldcarefullyreadthedefinitionsofallratingsusedinMorganStanleyResearch.Inaddition,sinceMorganStanleyResearchcontainsmorecompleteinformationconcerningtheanalyst'sviews,investorsshouldcarefullyreadMorganStanleyResearch,initsentirety,andnotinferthecontentsfromtheratingalone.Inanycase,ratings(orresearch)shouldnotbeusedorrelieduponasinvestmentadvice.Aninvestor'sdecisiontobuyorsellastockshoulddependonindividualcircumstances(suchastheinvestor'sexistingholdings)andotherconsiderations.

GlobalStockRatingsDistribution

(asofSeptember30,2026)

TheStockRatingsdescribedbelowapplytoMorganStanley'sFundamentalEquityResearchanddonotapplytoDebtResearchproducedbytheFirm.

Fordisclosurepurposesonly(inaccordancewithFINRArequirements),weincludethecategoryheadingsofBuy,Hold,andSellalongsideourratingsofOverweight,Equal-weight,Not-Rated

MorganStanleyResearch9

Idea

andUnderweight.MorganStanleydoesnotassignratingsofBuy,HoldorSelltothestockswecover.Overweight,Equal-weight,Not-RatedandUnderweightarenottheequivalentofbuy,hold,andsellbutrepresentrecommendedrelativeweightings(seedefinitionsbelow).Tosatisfyregulatoryrequirements,wecorrespondOverweight,ourmostpositivestockrating,withabuyrecommendation;wecorrespondEqual-weightandNot-RatedtoholdandUnderweighttosellrecommendations,respectively.

CoverageUniverse

InvestmentBankingClients(IBC)

OtherMaterialInvestmentServices

Clients(MISC)

StockRatingCategory

Count

%ofTotal

Count

%ofTotalIBC

%ofRating

Category

Count

%ofTotalOther

MISC

Overweight/Buy

1599

43%

455

48%

28%

783

44%

Equal-weight/Hold

1563

42%

394

42%

25%

763

43%

Not-Rated/Hold

2

0%

1

0%

50%

1

0%

Underweight/Sell

570

15%

96

10%

17%

227

13%

Total

3,734

946

1774

DataincludecommonstockandADRscurrentlyassignedratings.InvestmentBankingClientsarecompaniesfromwhomMorganStanleyreceivedinvestmentbankingcompensationinthelast12months.Duetoroundingoffofdecimals,thepercentagesprovidedinthe"%oftotal"columnmaynotadduptoexactly100percent.

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Benchmarksforeachregionareasfollows:NorthAmerica-S&P500;LatinAmerica-relevantMSCIcountryindexorMSCILatinAmericaIndex;Europe-MSCIEurope;Japan-TOPIX;Asia-relevantMSCIcountryindexorMSCIsub-regionalindexorMSCIACAsiaPacificexJapanIndex.

StockPrice,