The new energy sector, especially the hydrogen energy industry, is currently in a stage of rapid growth. After a short-term share price correction, valuations in the sector have returned to lower levels. Especially in the field of hydrogen energy, with the significant breakthrough in the performance of many companies, the market is full of expectations for the improvement of their valuations. Although Shandong Province's policy of exempting hydrogen heavy trucks from highway fees has not yet been promoted nationwide, it has brought unexpected benefits to the hydrogen energy industry, indicating that the policy environment is gradually changing in the direction of being conducive to the development of the hydrogen energy industry. In addition, the strong support at the national level is reflected in the subsidy policies jointly issued by 55 ministries and commissions, indicating that the hydrogen energy industry will usher in an important period from start-up to accelerated development.
Hydrogen fuel cell heavy-duty trucks have obvious competitive advantages in terms of cost, especially with the help of policies, their cost-effectiveness is even more significant. Even without taking into account subsidies, the cost of hydrogen heavy-duty trucks is already comparable to that of LNG heavy-duty trucks, and much lower than that of diesel and electric heavy-duty trucks, under the influence of high-speed fee reductions. In terms of market prospects, the potential demand for hydrogen heavy trucks is huge. Taking Shandong Province as an example, the number of heavy trucks has reached an astonishing 1.1 million. If the market penetration rate of hydrogen heavy trucks can reach 10% in the future, the potential market demand will reach 100,000 units, which is many times the growth rate of new energy vehicles in 2021. In addition, the subsidy policy of the local government and the support at the national level will provide a strong backing for the market promotion of hydrogen energy heavy trucks.
The development trend of the hydrogen energy industry chain shows that related market segments and enterprises will usher in new growth opportunities. Due to the support of wind and solar subsidies and large-scale bases, the filter element sector not only promotes the industrial chain to reduce carbon emissions, but also promotes the optimization of the cost side of enterprises. The construction of pipeline network is entering a new stage of development, and the support of policies has made intelligent energy storage a new focus of the industry. Through the adjustment of business structure, Shenghui has eliminated potential risks, and the wide recognition of its water electrolysis technology and the establishment of the first hydrogen refueling station have provided stable cash flow for the company's R&D and market layout, and strengthened its position in the industrial chain.
In terms of valuation analysis, some companies have received support from partners including shipbuilding enterprises and central enterprises, as well as local **, due to their stable business models and market performance exceeding expectations. Huadian has been shortlisted for important projects and is expected to achieve annual revenue recognition, with an estimated market value of between $13 billion and $14 billion. Although Huadian's valuation is difficult to accurately determine, its state-owned enterprise background and confirmed investment performance make it a worthy investment target. It is worth mentioning that once the operating rate of supporting wind power projects exceeds expectations, Huadian's valuation and market acceptance are expected to be significantly improved, which will bring potential revenue growth points to investors.
In terms of investment strategy, Cowell is in a solid position due to the sustainability of its business growth, and the development of its small power and semiconductor businesses, as well as the gradual increase in the proportion of energy business, all indicate the company's good growth logic. With the continuous growth of performance, Cowell's PE ratio remains stable, and its valuation has more room for improvement. Tian Yuan's focus on electrolyzer equipment manufacturing will likely become a pioneer in industry growth with the increase in industrial demand. The rapid growth of power battery demand has made the market demand for related equipment strong. With its low PE value and potential for performance growth, if it can achieve a significant jump in performance in the first quarter, it will further prove its intrinsic value, and its EPS and PE double rise will provide impetus for its valuation improvement.
In terms of industry prospects, the investment strategy of hydrogen energy and new energy vehicles needs to reconsider the dynamic changes in the policy environment. With the gradual relaxation of the free policy for new energy vehicles on the highway in various provinces, the utilization rate of new energy vehicles is expected to be further improved. Shandong's policy guidance may be emulated by demonstration city agglomerations in other provinces such as Henan, Hebei, Guangdong and other places, thus forming a demonstration zone for industry development and leading the rapid growth of the entire industry scale. With its strong position in the industrial chain, Synergy Energy can be regarded as an important investment allocation choice, and its role in stimulating the industry may be similar to LONGi's influence on the photovoltaic industry. Therefore, investors should pay close attention to the policy dynamics of the hydrogen energy industry, as well as the development trends within the industry, to make informed investment decisions.