Wire and Cable Industry Dilemma Takes Emphasis on Integration

In recent years, driven by the rapid development of the high-voltage transmission grid and new energy industry, more and more investors have invested in the cable manufacturing industry. The contradiction of overcapacity has gradually emerged. At present, the predicament of the wire and cable industry has aroused the attention of the Ministry of Industry and Information Technology, and industry consolidation has begun to take shape. Industry insiders believe that this will bring opportunities to listed companies with leading technology scale.

The author learned from the Department of Equipment Manufacturing of the Ministry of Industry and Information Technology on the 19th that the industry association, some cable manufacturers, cable material manufacturers and other units have insufficient self-innovation and product quality in the current industry. Inconsistencies, overcapacity, and other outstanding issues have been discussed in depth.

At the meeting, participants held in-depth discussions on promoting the healthy development of the wire and cable industry. According to Chen Kun, secretary-general of the Electrical Wire and Cable Branch of China National Electrical Equipment Industry Association, "The current deep problems in China's cable manufacturing industry are already very prominent. It is imperative for resource integration and transformation to be upgraded."

In this regard, Everbright Securities analysts expect the power cable market will move toward consolidation in the next few years. Leading companies will integrate the market through two routes: First, scale and scope expansion, lower costs and strengthen the brand and sales service network; Second, professional marketing, establish quality barriers and enhance the influence of market segments. The analyst believes that in the process of industry consolidation, the status of leading listed companies will be strengthened, and the trend of increasing market share will be obvious.