Citi reiterates Buy on TGOOD: AI Powerhouse strengthens AIDC power supply solution

Overview

This report comments on TGOOD's AI Powerhouse product released on June 6, 2026. The product is described as prefabricated power infrastructure for computing centers that converts high-voltage grid access into 800V DC supply to serve large AIDCs and computing centers. Citi believes the product significantly expands TGOOD's product portfolio and reiterates its Buy rating.

Core views

The core views are: first, AI Powerhouse is expected to leverage TGOOD's existing data center developer customer base for rapid deployment when demand for 800V DC supply emerges; second, the HVDC technology and production capacity accumulated in the EV charging segment can be transferred to large data center power supply scenarios; third, AIDC product demand and overseas expansion together form growth drivers; fourth, the current 2027E PE is not high relative to major Chinese electrical equipment peers.

Analysis framework

The report analyzes TGOOD from the perspectives of new product technical parameters, customers and orders, production capacity, accumulation from the EV charging business, peer valuation, and sum-of-the-parts valuation, and observes the impact of electrical equipment gross margin, prefabricated substation revenue growth, and EV charging pile utilization on valuation under bull, base, and bear assumptions.

Methodology notes

• Valuation frameworkSum-of-the-parts valuation

  A 2027E PE of 15.0x is applied to the EV charging business, while a 2027E PE of 30.0x is applied to the electrical equipment business with reference to the industry average of major Chinese grid equipment companies.

  Based on this, Citi derives a target price of Rmb49.60; at the target price, TGOOD corresponds to 27.5x 2027E PE and 4.5x PB.

• Scenario analysisBull, base, and bear assumptions

  Key variables include gross margin of electrical equipment sales, revenue growth of prefabricated high-voltage cabin substations, and average utilization rate of EV charging piles.

  Bull-case assumptions include a 2 percentage-point increase in electrical equipment gross margin, a 10 percentage-point increase in prefabricated substation revenue growth, and a 0.2 percentage-point increase in EV charging pile utilization; base-case assumptions include 2026E electrical equipment gross margin of 25%, prefabricated substation revenue up 10% YoY, and EV charging pile utilization of 7.2%; bear-case assumptions are the opposite.

• Product assessmentAIDC power supply solution assessment

  AI Powerhouse integrates high-voltage transformers, GIS, HVDC/SST, and other equipment into modular factory-prefabricated units.

  The system directly connects to the 110/220kV high-voltage grid and provides 800V DC power supply to data centers. Its core selling points include shortening construction cycles, improving power supply efficiency, lowering electricity costs, enhancing reliability, and reducing project and O&M costs.

Asset mapping & comparison

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

• 300001.SZ / Qingdao TGOOD Electric

  The report subject and primary investment target, directly affected by AI Powerhouse, AIDC power supply demand, the EV charging business, and overseas expansion.

  Strengths

  The company has a foundation in EV charging equipment and network operations, with cumulative production of more than 2 million HVDC modules; AI Powerhouse offers selling points such as shortened construction cycles, lower electricity costs, higher efficiency, and lower project costs; five computing center project orders have already been disclosed.

  Weaknesses

  Commercialization of the new product still depends on actual adoption of 800V DC power supply solutions by large data centers, while utilization in the EV charging business remains affected by competition.

  Comparison

  Citi believes its 22.7x 2027E PE is not high relative to major Chinese electrical equipment peers; the valuation of the electrical equipment business references the industry average of major Chinese grid equipment companies.

  Risks

  New EV charging capacity could come in below expectations, competition could drive EV charging utilization below expectations, and demand for renewable energy-related electrical equipment could be lower than expected.

• Tencent Holdings (0700.HK)

  A related company and one of the potential customer leads mentioned in the report, not the primary covered target of this report.

  Strengths

  As a large internet and computing resource demander, it may represent a source of demand for AIDC power supply infrastructure.

  Weaknesses

  The report does not provide Tencent's order size, revenue contribution, or procurement timing.

  Comparison

  Unlike TGOOD, Tencent appears in this report mainly as a customer or related company rather than a valuation and rating subject.

  Risks

  Customer order conversion, project timing, and insufficient disclosed information may affect judgments about revenue contribution to TGOOD.

Key data

• Product launch dateJune 6, 2026TGOOD launched AI Powerhouse.
• Applicable scenarioLarge data centers of 100MW and aboveThe prefabricated high-voltage power supply system is designed for large computing centers.
• Input and output voltage110/220kV high-voltage input, 800V DC outputThe system can directly convert high-voltage power into DC supply for data centers.
• Construction cycle150 daysThe company says factory modular prefabrication can significantly shorten the construction cycle.
• Power supply efficiency98.51%Based on silicon carbide SiC solid-state transformer SST technology.
• Token-related electricity costsReduced by about 30%Achieved through optimized dispatch of AI-oriented renewable energy and energy storage systems.
• Renewable energy absorption100% on-site absorptionThe report cites the company's description of AI Powerhouse's product advantages.
• System reliability99.9998%This is the system reliability metric disclosed by the company.
• Project and O&M costsProject costs down 20%, O&M costs down 40%Integrated design delivers cost improvements.
• Orders and customersOrders from five computing center projectsCustomers include leading Chinese telecom operators, Tencent, and Huaneng.
• Historical HVDC module productionMore than 2 million units, total capacity 80GWCumulative production experience from the EV charging equipment business.
• Current production capacity1 million HVDC modules or 25,000 sets of 2.5MW HVDC systemsThe company's current annual production capacity.
• 2027E target production capacity1.5 million SST/HVDC modules or 35,000 sets of 2.5MW SST/HVDC systemsThe company plans to expand capacity by 2027E.
• Target priceRmb49.60Derived based on sum-of-the-parts valuation.
• Valuation22.7x 2027E PECiti believes the valuation is not high relative to major Chinese electrical equipment peers.

Impact & implications

If successfully commercialized, AI Powerhouse could drive TGOOD's extension from EV charging equipment and charging network operations into AIDC power infrastructure, strengthening the reuse value of its expertise in high-voltage DC, solid-state transformers, and modular power supply systems. From a stock perspective, Citi views it as an important incremental addition to the product portfolio and believes AIDC demand and overseas expansion can jointly support the company's growth and valuation.

Risks

• New EV charging capacity may fall short of expectations, potentially dragging down growth in the charging business.
• Competition may lead EV charging utilization to come in below expectations, potentially affecting profitability.
• Demand for renewable energy-related electrical equipment may fall short of expectations, potentially weakening growth in the electrical equipment business.
• If deployment of AI Powerhouse and 800V DC power supply in large AIDCs is slower than expected, the incremental contribution of the new product may be affected.

What to watch

• Delivery progress, order size, and revenue recognition timing for the five computing center projects already secured by AI Powerhouse.
• Acceptance of 800V DC power supply solutions by large data centers of 100MW and above.
• Whether SST/HVDC module capacity expansion can reach 1.5 million modules or 35,000 sets of 2.5MW systems by 2027E.
• Changes in average EV charging pile utilization and the competitive landscape.
• Demand for renewable energy and grid equipment, as well as order opportunities brought by overseas expansion.
• Whether the valuation assumptions behind Citi's target price of Rmb49.60 change with industry PE, profit growth, and project execution.