BofA Lifts Dongfang's Price Target by 67%
On March 9, 2026, Bank of America Securities issued a bullish report on Dongfang Electric, raising its target price for the company's H-shares (01072) by 66.7% to HK$55 from HK$33. The target for its A-shares (600875.SH) was also increased to RMB 54 from RMB 32. The bank reiterated its "Buy" rating, reflecting increased confidence in the company's earnings potential. BofA revised its net profit forecasts for Dongfang, lifting the 2026 estimate by 13% and the 2027 estimate by 30%.
AI Data Centers Fuel Global Power Equipment Demand
The primary catalyst for the upgrade is the explosive growth in power consumption from U.S. artificial intelligence data centers. This has created a bottleneck for traditional power equipment suppliers, with BofA noting that established overseas gas turbine manufacturers face delivery times exceeding two years. The capacity crunch provides a significant opening for new entrants. Dongfang Electric is capitalizing on this by fielding a notable increase in inquiries for its gas turbines from both emerging and developed countries.
Gas Turbine Exports Provide a Competitive Edge
Dongfang Electric holds a key strategic advantage as the only Chinese manufacturer capable of exporting F-class gas turbines. This allows the company to offer shorter delivery times and more competitive pricing compared to its international peers. Furthermore, BofA noted that geopolitical tensions in Iran are shifting its view on coal-fired power more positively. This may prompt China to increase investment in domestic baseload electricity to enhance its energy security, a trend from which Dongfang, a market leader in such equipment, stands to benefit directly.
