Report Interpretation

Overview

J.P. Morgan initiates coverage of Dajin-H/A at Overweight. Its investment case rests on accelerating European offshore-wind demand, tight qualified foundation supply, Dajin's expanding integrated-service model, floating-wind optionality and specialized shipbuilding growth, offset by project-pipeline and trade-policy risks.

Core views

J.P. Morgan argues that European offshore wind is entering a stronger build cycle. It forecasts 2026-30 new installations to be about 160% above 2021-25, supporting roughly 30% CAGR for the European wind-foundation market. WindEurope's approximately 70GW estimate for European cumulative capacity in 2030 is well below government ambitions above 150GW, but the report views even this conservative case as a durable demand runway. Average annual European offshore-wind construction of 5-6GW in 2026-30 would remain well ahead of 2GW in 2025. The report expects Dajin to gain further share because qualified European foundation capacity remains constrained through 2030. Dajin's European monopile share increased from 18.5% in 2024 to 29.1% in 1H25, and it is described as the only Asia-Pacific supplier to have delivered monopiles to Europe in bulk. The report cites Dajin's scale, technical execution, logistics capability and ability to produce monopiles above 15m in diameter. It also points to delayed ramp-up at SIF's Rotterdam facility and SeAH Wind's cancellation of Hornsea 3 monopile production as evidence that delivery reliability is valuable to developers facing tight schedules. Dajin's strategy extends beyond manufacturing. Heavy marine transport, local logistics and wind-marshalling port operations allow it to offer end-to-end delivery under a DAP model rather than the more limited FOB structure used by many peers. The report argues that assuming transportation responsibility to the customer-designated destination reduces customers' logistics burden, improves schedule control and creates higher-value, stickier relationships. Dajin delivered 36 oversized monopiles to Denmark's Thor project in 2024-25 and planned multi-batch deliveries for Germany's Nordseecluster A in 2025. A growing self-owned vessel fleet is expected to improve delivery execution, lower logistics costs and support margins. Near-term earnings were hurt by 2Q shipment delays, slower order flows and FX losses from RMB appreciation; Dajin-A/H underperformed relevant indices by 32%/50% from 4 June to 21 September. J.P. Morgan nevertheless expects a 2027 recovery as FX headwinds lessen, more transportation shifts to the in-house fleet and European orders improve. It forecasts wind-equipment sales volume to decline 3% in 2026 before rising 5% in 2027 and 17% in 2028, while overseas offshore-foundation volume grows more than 20% in 2026. The report forecasts revenue growth of 9% in 2026E and above 30% in 2027-28, with higher overseas mix and integrated services supporting margins. Policy and project developments are central potential catalysts. The report highlights a prospective supportive outcome from UK AR8, Germany's CfD framework and delayed final investment decisions resuming. Germany's Waterekke project obtained offshore grid-connection approval in August 2026 after its 1.5GW auction award and turbine-capacity reservation, improving project visibility; J.P. Morgan believes Dajin could be shortlisted for its foundation order. However, no-bid auctions, cost inflation, turbine bottlenecks and uncertain grid connections can delay awards and reduce near-term pipeline visibility. Floating wind is presented as material upside optionality. With close to 80% of global offshore-wind resource potential in water deeper than 50m, floating foundations are larger, more technically complex and higher value per MW than fixed-bottom structures. European floating-wind installations are projected to rise from 25MW in 2024 to 550MW in 2030. Under a scenario assuming Dajin captures 50% of 550MW in 2030, the report estimates more than Rmb1bn of additional net profit, versus FY25 net profit of Rmb1.1bn. Dajin is developing a dedicated floating-foundation line with capacity of about 100 sets annually and has established a global floating-wind business center in Madrid. Specialized shipbuilding is the report's second growth engine. Dajin has contracted to design, build and deliver 24 ships for customers in South Korea, Norway, Greece and the Netherlands, with aggregate value of about Rmb12bn as of September 2026 and delivery scheduled for 2027-30. J.P. Morgan expects this to diversify revenue, support margins and improve supply-chain control by securing heavy-lift vessel availability for Dajin's own offshore-wind deliveries. For valuation, J.P. Morgan uses a sum-of-the-parts framework and sets Dec-27 targets of HK$43 for Dajin-H and Rmb47 for Dajin-A, implying 36% and 18% upside. It applies FY28E P/E multiples of 15x/17x to wind equipment, 8x/11x to specialized shipbuilding, and 7x/15x to renewable generation for H/A shares, producing blended FY28E P/E of 13x and 16x. The report considers current FY28E P/E of about 9x for H shares and 13x for A shares attractive against its approximately 26% 2026E-28E earnings CAGR. It notes, however, that its FY26-28 estimates are below Bloomberg consensus by less than 20%, leaving scope for further consensus reductions.

Analysis framework

The report combines offshore-wind supply-demand analysis, Dajin's market-share and operating-position assessment, project and policy tracking, earnings forecasts, a floating-wind scenario and sum-of-the-parts valuation. It compares Dajin with domestic and overseas foundation peers and separates wind equipment, shipbuilding and renewable generation for valuation.

Methodology notes

• Industry AnalysisSupply-demand framework

  European offshore-wind installation growth and qualified foundation-supply tightness

  The report compares projected installation demand with constrained qualified manufacturing capacity to explain why Dajin could sustain share gains and margins.

• Industry AnalysisUpstream-Midstream-Downstream Transmission

  Integrated manufacturing, marine transport, port operations and shipbuilding model

  The report links Dajin's control of logistics and vessel capacity to delivery reliability, customer stickiness, order value and profitability.

• Valuation methodsSOTP (Sum-of-the-Parts) Valuation

  Sum-of-the-parts valuation using segment-specific FY28E P/E multiples

  Wind equipment, specialized shipbuilding and renewable generation are valued separately before deriving the H- and A-share target prices.

• Other

  Floating-wind earnings scenario analysis

  The report estimates potential 2030 profit using assumptions for installed capacity, market share, foundation weight, pricing and net margin.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Dajin-H (1081.HK)

  Primary covered H-share of Dajin

  Strengths

  European foundation share gains, integrated services, floating-wind and shipbuilding optionality.

  Weaknesses

  Recent results were affected by shipment delays and FX losses.

  Comparison

  Trades at about 9x FY28E P/E versus a 13x blended target P/E in the report.

  Risks

  European project delays, weaker order awards, trade-policy uncertainty and potential consensus cuts.

• Dajin-A (002487.SZ)

  Primary covered A-share of Dajin

  Strengths

  Same operating exposure to European foundations, service expansion and shipbuilding growth.

  Weaknesses

  Recent results were affected by shipment delays and FX losses.

  Comparison

  Trades at about 13x FY28E P/E versus a 16x blended target P/E in the report.

  Risks

  European project delays, weaker order awards, trade-policy uncertainty and potential consensus cuts.

• SIF Group

  Competitor

  Weaknesses

  Its Rotterdam monopile factory ramp-up was delayed by six to nine months.

  Comparison

  The report views the temporary capacity constraint as a potential near-term share opportunity for Dajin.

• SeAH Wind

  Competitor

  Weaknesses

  Cancelled monopile production for Ørsted's Hornsea 3 amid plant-readiness concerns.

  Comparison

  The report considers Dajin's delivery record a competitive advantage versus this peer.

Key data

• European offshore-wind installations~160% increase in 2026-30 versus 2021-25Core demand assumption for foundations.
• Dajin European monopile market share29.1% in 1H25 versus 18.5% in 2024Evidence of share gains.
• European cumulative offshore-wind capacity~70GW by 2030WindEurope estimate, below government ambitions above 150GW.
• FY26E-28E earnings CAGR~26%J.P. Morgan forecast used in valuation discussion.
• Shipbuilding orderbook~Rmb12bnAs of September 2026; deliveries expected from 2027 to 2030.
• Floating-wind scenario profitOver Rmb1bn in 2030EAssumes 50% share of 550MW European floating-wind installations.
• Dajin-H target priceHK$43.00Dec-27 target; 36% implied upside.
• Dajin-A target priceRmb47.00Dec-27 target; 18% implied upside.

Impact & implications

J.P. Morgan believes Dajin's European exposure, technical capabilities and integrated logistics model position it to benefit disproportionately if offshore-wind auctions, grid connections and final investment decisions normalize. Floating foundations and shipbuilding add longer-term earnings diversification and value-chain control.

Risks

• European offshore-wind installation demand could be weaker than expected if auctions fail to attract bids or project schedules slip.
• Cost inflation, interest rates and uncertain grid-connection timelines could impair project economics, delay final investment decisions or lead developers to exit awarded sites.
• Weak 2027 order awards or backlog slippage could reduce earnings visibility.
• EU steel-import policy, including CBAM and possible expansion of safeguard product scope, could raise sourcing or margin risks.
• J.P. Morgan's FY26-28 estimates are less than 20% below Bloomberg consensus, creating risk of further consensus cuts.

What to watch

• UK AR8 auction outcomes and changes in its budget or support structure.
• Implementation of Germany's CfD changes, auction normalization and progress toward delayed final investment decisions.
• Waterekke project progress and possible Dajin foundation-order shortlisting.
• Turbine contracting and manufacturing progress, which can relieve a bottleneck for foundation demand.
• New European foundation orders and additional shipbuilding wins that extend backlog visibility.
• EU review of whether steel safeguards should broaden to downstream products by 1H27.