23-03 2026
Power Grid Equipment Sector Rallies Against Market Trend, Becoming a Capital "Safe Haven"
On March 4, while the A-share market experienced a contraction and pullback, the power grid equipment sector bucked the trend with a 3.33% surge. The core driver behind this performance lies in the extreme execution of the HALO (Heavy Assets, Low Obsolescence) investment strategy—as global capital pursues physical assets that are difficult for AI to replace and upon which AI itself depends, power equipment has been upgraded from a traditional cyclical stock to the "lifeline" of computing clusters. Data shows that the sector attracted net inflow of RMB 2.904 billion from main force capital on that day, ranking first in the entire market, with several stocks such as Tongguang Cable hitting the "20cm limit-up." Currently, the global power equipment industry is undergoing accelerated transformation. China's transformer export value and growth rate, combined with nearly RMB 5 trillion in investment from the country's two major power grids during the 15th Five-Year Plan period, will solidify the foundation for the power equipment industry.
On March 4, global stock markets presented a pattern of sharp declines in Asia-Pacific, losses in Europe and the US, and volatile weakness in A-shares. However, the A-share power grid equipment sector staged an independent upward trend, rising 3.33% against the market tide and becoming the most prominent "safe haven" in the day's trading.
On that day, the three major A-share indices all closed lower. By the closing bell, the Shanghai Composite Index had fallen 0.98%, dropping below the 4,100-point level. Market trading volume contracted significantly, with the combined turnover of the Shanghai, Shenzhen, and Beijing stock exchanges reaching RMB 2.3879 trillion, a decrease of RMB 769.6 billion from the previous trading day. More than 3,600 stocks ended the day in negative territory.
In terms of sector performance, power grid equipment, military equipment, grain concepts, minor metals, dyes, agrochemicals, optical fiber concepts, and memory chips were among the top gainers.
The reporter noted that the power grid equipment's counter-trend rise was driven not only by fundamental support but also by an emerging investment paradigm that has been sweeping global capital markets since the beginning of the year—the extreme execution of the HALO strategy.
HALO Logic: From "Light Asset Narrative" to "Hard Asset Revaluation"
As of today's close, against the backdrop of A-share contraction and substantial net outflow of main force capital across the market, the power grid equipment sector bucked the trend with a net inflow of RMB 2.904 billion from main force capital, ranking first in net inflows across the entire market on that day.
Key strong stocks within the sector delivered impressive performances: Tongguang Cable quickly hit the limit-up at the opening with a pending order amount of RMB 1.655 billion, remaining closed for the entire trading session; Jianan Intelligent Power hit the limit-up firmly in the afternoon with significantly expanded volume; Ankrui Zhidian surged straight up in the morning session to hit the limit-up. All three stocks achieved the "20cm limit-up." Additionally, Yidian Power rose 16.15%, Xinte Electric rose 15.85%, Shuangjie Electric rose 11.35%, and Shunna Shares hit the limit-up within one minute of opening, reaching a nine-year high.
To understand today's breakout in power grid equipment, one must first understand HALO.
HALO is an acronym for "Heavy Assets, Low Obsolescence." The core logic of this strategy is to go long on physical assets that are "difficult for AI to replace and upon which AI depends," while going short on light assets that are "easily disrupted by AI." Major international investment banks such as Goldman Sachs and Morgan Stanley simultaneously promoted this strategy in early 2026, arguing that the market's pricing logic has shifted from an expandable light asset narrative to buildable, difficult-to-replace physical capacity.
A depth report released by Goldman Sachs on February 24 noted that under the triple pressures of rising interest rates, geopolitical fragmentation, and surging AI capital expenditure, tangible production capacity is becoming a scarce resource. Goldman Sachs analysts emphasized that industries such as utilities, basic resources, energy, and transportation infrastructure have become core beneficiaries.
Rapidly spreading from Wall Street to A-shares, today's broad-based strength in power grid equipment is a concrete manifestation of HALO logic in the A-share market.
Capital flow data provides the most direct evidence: the largest power grid equipment ETF in the market rose more than 4% during today's trading session, with active trading throughout the day. Notably, against the backdrop of significant overall market contraction, the power grid equipment sector saw capital inflows against the trend, indicating that safe-haven capital is accelerating its entry into hard asset sectors that align with HALO characteristics.
Zhao Gege, Chief Macro Analyst at Everbright Securities, stated in a report released on March 2 that, mapped to the A-share market, the essence of HALO trading is capital's repricing of "scarce assets." China possesses the world's most complete supply chain system, with leading advantages in industries such as new energy, power equipment, strategic metals, chemical materials, and shipbuilding, positioning these sectors to become hard assets in the AI era. As industrial upgrading and industry consolidation progress, their strategic value may undergo systematic revaluation.
Power Grid Equipment: From "Traditional Cyclical" to Computing Power's "Core Competitiveness"
If HALO provides the macro logic, then industry-level shifts have provided the engine for today's counter-trend surge.
On the news front, during the last week of February, two news items triggered a chain reaction across the ocean: NVIDIA's earnings report revealed that customers had deployed 9 gigawatts of Blackwell infrastructure; US President Donald Trump announced in his State of the Union address that he would convene technology giants to sign a "self-generation" commitment. Both point to the same proposition—the rapid advance of AI is driving up electricity bills in the United States.
A consensus is forming: in the AI era, energy is no longer a cost item in the back office but a core competitiveness factor on the front line. This means that power equipment is no longer a traditional cyclical stock but has been upgraded to the "lifeline" of computing clusters.
Data from the International Energy Agency corroborates this: to meet electricity demand by 2030, global grid investment needs to increase by 50% annually. In North America, supply gaps for power transformers and distribution transformers have reached 30% and 6%, respectively, with imported products accounting for half of the US market.
Currently, the global power equipment industry landscape is undergoing reshaping. Data from the General Administration of Customs shows that China's transformer export value reached RMB 64.6 billion in 2025, an increase of nearly 36% from 2024, setting a new historical record. Even more striking is the export growth rate—from January to August 2025, China's cumulative transformer export value reached RMB 29.711 billion, a year-on-year surge of 51.42%. Europe and North America have become the main drivers of export growth.
Great Wall Securities' analysis points out that supply constraints for power grid equipment overseas present a historic opportunity for Chinese companies.
On the domestic front, the start of the 15th Five-Year Plan period has solidified growth expectations—State Grid Corporation of China has announced a planned investment of RMB 4 trillion for the 15th Five-Year Plan period, a 40% increase compared to the 14th Five-Year Plan period. China Southern Power Grid has arranged RMB 180 billion in fixed asset investment for 2026, with total investment expected to approach RMB 1 trillion during the 15th Five-Year Plan period. The combined five-year investment scale of the two major grids is approaching RMB 5 trillion, focusing on ultra-high voltage transmission, smart distribution networks, grid digitalization, and new energy integration.
As Mou Yiling, Chief Strategy Officer at Sinolink Securities, put it, global investors may find that the undisruptable HALO assets they have been searching for are widely distributed in the Chinese market.
Against the backdrop of a bleak Asia-Pacific market, a decline of over 3,600 A-shares, and a sharp drop in trading volume of nearly RMB 770 billion, the counter-trend surge in the power grid equipment sector is no coincidence. It is both a safe-haven choice for capital seeking "low obsolescence" physical assets under the HALO strategy, an industrial necessity driven by AI infrastructure's demand for electricity, and a transmission of capital's risk aversion amid turbulence in the Middle East.
As tens of billions of yuan continue to flow into the power grid equipment sector, the market is declaring with real money that in an era of dual transformations driven by AI and geopolitics, energy and power may well become one of the scarcest hard assets of our time.
