The recent disclosure announcement of the Shenzhen Stock Exchange Municipal Committee shows that Wuhan Gangdi Technology Co., LTD. (hereinafter referred to as “Gangdi Technology” or the “Company”) will be launched on the GEM on January 5. According to the prospectus, Hong Di Technology is a high-tech enterprise focusing on the research and development, production and sales of products in the field of industrial automation and a state-level specialized new “little giant” enterprise. Its products mainly include automation drive products, intelligent control systems, and management system software, which are mainly used for single-machine automation control of various types of large and medium-sized equipment. And the automatic control of equipment production operations.

Industry 4.0 is advancing in depth, and multiple favorable policies are welcoming development opportunities

With the advent of the Industry 4.0 era, the state has introduced a series of policies such as the Outline of the National innovation-driven Development Strategy to support and guide the industrial automation industry, and the country’s clear policy guidance and full support provide a good opportunity for the rapid development of China’s industrial automation industry.

The introduction of new technologies such as 5G, the Internet of Things, and artificial intelligence will enable intelligent manufacturing, make production flexible, intelligent, and highly integrated, and shorten the product development cycle, reduce resource and energy consumption, reduce operating costs, and improve production efficiency. China’s manufacturing industry is transforming under the impetus of new technologies, developing to high-quality and intelligent demand, and driving the demand for automation products.

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At the same time, the technical level of domestic leading brands of industrial automation equipment is in the process of continuous improvement, and the gap between foreign brands is gradually narrowing. Local brands are closer to domestic customers, more in-depth research on domestic customer needs, with a stronger segmentation field demand mining ability, service response speed is faster, the acceptance of domestic customers continues to improve, and the continuous promotion of domestic product import substitution also brings opportunities for the development of the industry.

In addition, any modern manufacturing industry that needs to improve production efficiency requires the use of automated control product equipment, and automatic drive products such as frequency inverters are widely used in many fields of the national economy, including automobile manufacturing, construction machinery, petrochemical, metallurgy, logistics and warehousing industries. Automation driven products need to meet the incremental demand generated by the expansion of emerging industries, the traditional industry stock equipment update also brings greater product demand, further expanding the level of market demand, automation driven products downstream application field is wide and constantly expanding for the development of the industry brings opportunities.

Rapid expansion of scale, high growth of the industry can be expected

Although China’s industrial automation industry started late, but the development momentum is strong, especially in the context of the transformation and upgrading of the manufacturing industry, China’s traditional industrial technology transformation, factory automation and enterprise informatization need a large number of industrial automation control systems, and the market potential is huge. Data released by China Industrial Control Network show that in 2022, China’s industrial automation market size reached 261.1 billion yuan, an increase of 3.2%. With the further deepening of supply-side reform, the market size is expected to reach 282.2 billion yuan in 2023. 2017-2023 China’s industrial automation market size and growth rate is as follows: