Hanbell Precise Machinery: Maintain Buy, with long-term growth driven by semiconductor vacuum pumps, AIDC compressors, and industrial heat pumps

Overview

This report updates Hanbell Precise Machinery's growth outlook and valuation view. HSBC Qianhai believes that although earnings growth in 2026 will be limited, the company has long-term growth potential across three tracks—semiconductor vacuum pumps, AIDC data center compressors, and industrial heat pumps—and therefore maintains its Buy rating and RMB38.80 target price.

Core views

The core view is that Hanbell Precise Machinery's growth is not driven by a single cycle, but by a relay of multiple large markets: semiconductor vacuum pumps will grow first from a low base, followed by demand release for AIDC-related maglev and screw compressors, while industrial heat pumps provide longer-term support under rigid carbon reduction needs. The report believes the market has recently viewed the company as a semiconductor equipment supply chain name, mainly because domestic semiconductor capacity expansion and import substitution in vacuum pumps are expected to drive share gains.

Analysis framework

The report uses segment-level revenue forecasts, AIDC compressor market size estimation, customer certification and import substitution logic for semiconductor vacuum pumps, demand research on industrial heat pumps in China and Europe, and a DCF valuation model to determine the target price and investment rating.

Methodology notes

• Valuation methodsDCF

  Discounted cash flow valuation

  The report continues to use a DCF model, with the target price maintained at RMB38.80; key assumptions include WACC of 9.5%, cost of equity of 10.2%, pre-tax cost of debt of 5.0%, a 2024-2037e operating cash flow CAGR of 8.7%, and a terminal growth rate of 2%.

• Market sizingAIDC maglev compressor TAM estimation

  Estimating market size based on incremental data center power capacity, compressor load share, penetration rate, and value per GW

  The report assumes 24.1GW of global incremental data center capacity in 2028e, a 70% penetration rate for maglev compressors, and value of about RMB1bn per GW, estimating the global data center maglev compressor market at about RMB16.9bn in 2028e.

• Cross-validationCross-validation of value per unit of power

  Using compressor power load and the USD/kW price range to validate AIDC compressor value

  The report cites assumptions for a 12.5MW data center, PUE of 1.25, and cooling system power of about 2MW, deriving that compressor power accounts for about 20% of total data center power; based on USD500-700/kW, each 1GW of data center capacity corresponds to about USD120m-168m of compressor value.

• Industry researchIndustrial heat pump potential market estimation

  Estimating large heat pump opportunity based on the sub-200°C portion of European industrial process heat and annual installation cycles

  Citing sources such as EHPA, the report believes Europe's total potential industrial heat pump capacity is about 105GW; assuming installation over 25 years, the annual average would be about 3.6GW; at EUR1.5bn/GW, the annual addressable market is about EUR5.4bn.

Asset mapping & comparison

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

• Hanbell Precise Machinery 002158.SZ / 002158 CH

  Core coverage target

  Strengths

  Exposure to multiple businesses including semiconductor vacuum pumps, refrigeration compressors, AIDC compressors, and industrial heat pumps; improved growth visibility after 2027; DCF target price implies 44.4% upside.

  Weaknesses

  Absolute growth in 2026 is still constrained by a low base and product certification progress; traditional central air-conditioning and refrigeration markets are weak.

  Comparison

  Compared with single supply-chain equipment companies, Hanbell Precise Machinery's investment case comes from a multi-track combination of semiconductors, data center thermal control, and industrial heat pumps.

  Risks

  AIDC and industrial heat pump demand falling short of expectations, rising raw material costs, intensified compressor competition, weaker-than-expected vacuum pump demand, and uncertainty in overseas business.

• SKY technology 920186 CH

  Peer reference in semiconductor vacuum pumps

  Strengths

  One of China's leading local suppliers of semiconductor vacuum pumps, reflecting the trend of import substitution.

  Weaknesses

  Some highly difficult process steps in advanced manufacturing have still not completed full testing and validation.

  Comparison

  The report uses SKY technology's listing and progress in import substitution as supporting evidence for Hanbell Precise Machinery's semiconductor vacuum pump opportunity.

  Risks

  Validation progress in advanced process nodes and competition from overseas brands still affect the pace of market share gains for domestic suppliers.

• AIDC thermal control supply chain

  Potential growth scenario for Hanbell Precise Machinery

  Strengths

  Global incremental data center capacity drives demand for maglev and screw compressors, and downstream customers may introduce second and third suppliers.

  Weaknesses

  The degree of compressor supply shortage is not as severe as in gas turbines, capacitors, memory chips, or large transformers, so the addressable market is not the largest.

  Comparison

  Existing suppliers such as Danfoss remain strong, and Hanbell Precise Machinery's opportunity mainly comes from supply chain diversification and product certification.

  Risks

  Changes in downstream AIDC construction pace, customer certification progress, and the competitive landscape.

• Industrial heat pump market

  Long-term demand support

  Strengths

  Rigid carbon reduction needs support long-term growth, and both China and Europe have large potential markets.

  Weaknesses

  Near-term adoption is constrained by the difficulty of retrofitting old projects, power capacity, site limitations, and insufficient policy support.

  Comparison

  China's short-term market growth is slower than expected, while the European market has higher pricing but policy focus still leans toward residential heat pumps.

  Risks

  Insufficient policy support, longer installation cycles, and uncertainty over Hanbell Precise Machinery's overseas market share gains.

Key data

• RatingBuy / Maintain BuyThe report explicitly maintains a Buy rating.
• Target priceRMB38.80The target price is unchanged from before.
• Current share priceRMB26.87As of the close on July 17, 2026.
• Implied upside+44.4%Based on the RMB38.80 target price and the current share price of RMB26.87.
• 2026e P/E23.8xThe report shows the stock trading at 23.8x 2026e PE.
• 2027e P/E17.6xLower than 2026e, reflecting expected earnings growth.
• 2025-2028e earnings CAGR34.9%The report forecasts earnings CAGR for 2025-2028.
• 2026e revenueRMB3,428.9mBased on the financial forecast table.
• 2027e revenueRMB4,370.7mBased on the financial forecast table.
• 2028e revenueRMB5,586.8mBased on the financial forecast table.
• 2026e net profitRMB603.2mHSBC Qianhai forecast.
• 2027e net profitRMB817.6mHSBC Qianhai forecast.
• 2028e net profitRMB1,150.5mHSBC Qianhai forecast.
• Semiconductor vacuum pump revenue forecastAbout RMB100m in 2025e, and RMB202m in 2026eThe report believes this business has been relatively stable since 2021 and is poised for significant growth in 2026.
• AIDC maglev compressor marketAbout RMB16.9bn in 2028eBased on global incremental data center capacity and compressor value estimation.
• China 1H26 data center thermal control air-conditioning growth+13.6% y-o-yThe report says data center demand cushioned the decline in central air-conditioning.
• China 1H26 industrial heat pump growth+15.5% y-o-yAlthough slower than expected, it still supports the long-term thesis.
• Europe industrial heat pump annualized potential marketAbout EUR5.4bn/yearBased on assumptions of 105GW potential capacity, 25-year installation, and EUR1.5bn/GW pricing.

Impact & implications

The investment implication is that Hanbell Precise Machinery remains affected in the short term by weak demand in traditional refrigeration and central air-conditioning, but domestic substitution in semiconductor equipment, supply chain diversification in AIDC thermal control, and long-term decarbonization demand for industrial heat pumps form more important medium- to long-term growth drivers. In valuation terms, if earnings materialize after 2027, the current share price still has significant upside relative to the DCF target price.

Risks

• Weaker-than-expected growth trends in data centers and industrial heat pumps may reduce earnings forecasts.
• Stronger-than-expected raw material cost inflation may pressure margins.
• Stronger-than-expected competition in the compressor market, especially with more new entrants in areas such as energy storage thermal control.
• Weaker-than-expected growth in compressor demand in China may affect revenue related to refrigeration compressors and air compressors.
• Weaker-than-expected growth in vacuum pump demand may affect businesses related to solar wafers, battery manufacturing, and semiconductor manufacturing.
• Overseas business faces uncertainties such as exchange rate fluctuations and new tariffs.
• Industrial heat pump adoption is constrained by retrofitting existing projects, power capacity, and installation space, so near-term volume ramp-up may lag long-term potential.

What to watch

• The release of more favorable policies related to industrial heat pumps.
• Whether China's industrial heat pump demand data improves.
• AIDC compressor sales and customer certification progress.
• Whether quarterly earnings show a recovery.
• Certification and volume ramp-up of semiconductor vacuum pumps in 12-inch equipment, memory chips, and domestic semiconductor equipment manufacturers.
• Policy support for large industrial heat pumps in Europe and Hanbell Precise Machinery's potential market share gains.