Against the backdrop of an average industrial growth rate of 2.53% and a manufacturing added value growth rate of 2.69%, the global production of industrial valve products reached 19.4 billion pieces in 2019, with the most significant increase in the proportion of industrial and papermaking. The demand in the oil and gas sector is relatively low. The following is an analysis of the industrial layout of the industrial valve industry.
The sustained and stable growth of the global economic aggregate has driven the development of downstream industries such as oil and gas, electricity, water treatment, chemical, and urban construction. Analysis of the industrial valve industry indicates that the global industrial valve industry is developing rapidly and has also achieved rapid growth. In 2019, the global industrial valve market size increased to 123.56 billion US dollars.
The industrial layout of the industrial valve industry indicates that in 2019, the market size of China's industrial valves was 12 billion US dollars, accounting for 19.5% of the global market. According to the development speed and investment intensity of various industries in China, the proportion of the domestic industrial valve market in the world is steadily increasing. In 2020, the global industrial valve market size was about 64 billion US dollars, and China's proportion will reach 20% -21%. Therefore, the domestic market size in 2020 is about 12.8-13.5 billion US dollars.
From a market perspective, most domestic valve companies are in the low-end market of the valve industry. The valve products in the low-end market have strong universality, low technical content, low entry barriers, numerous industry enterprises, and the overall industry presents a highly competitive situation with low market concentration. With the continuous increase of new entrants in the industry, competition will become more intense, and the profit level of the low-end valve market will also decline.
From the perspective of enterprise layout, the domestic valve industry is accelerating its reshuffle, and large valve manufacturers may stand out in the future. On the one hand, small and micro enterprises with less standardized operations and lower core competitiveness are gradually withdrawing from the market, while the market share of large domestic valve enterprises is steadily increasing. On the other hand, there is still significant room for improvement in the size of domestic valve enterprises compared to international giants (with Neway's revenue exceeding 2 billion yuan, and about 7-8 companies at 1-2 billion yuan). I believe that with the recovery of downstream markets and the improvement of international competitiveness of enterprises, the market share of domestic leading enterprises represented by Neway will continue to increase in 2020, and it is expected to give birth to a global leader in high-end industrial valves.
At present, China's industrial valve production enterprises are mainly concentrated in Zhejiang, Jiangsu, and Shanghai, with 26 valve companies trading on the Shenzhen Stock Exchange, Shanghai Stock Exchange, Hong Kong Stock Exchange, and New Third Board markets. The industrial layout of the industrial valve industry points out that these 26 valve companies have varying scales and product types, which to some extent truly reflect the operating status of domestic valve enterprises. In 2019, 17 out of the 26 companies mentioned above had revenues exceeding 100 million yuan, with Neway Corporation leading the industry in terms of revenue and net profit.
China is capable of producing over 3000 models and 40000 specifications of industrial valve products. The categories include gate valves, globe valves, throttle valves, plug valves, ball valves, butterfly valves, diaphragm valves, check valves, safety valves, pressure reducing valves, drain valves, and regulating valves, totaling twelve categories. Petrochemical and coal chemical valve products, as well as long-distance pipeline supporting valves, have been identified as key development efforts for new products in the industrial valve industry during the 13th Five Year Plan period.
Overall, China's industrial valve enterprises are still relatively small in size compared to foreign giants, and the market structure is relatively scattered. China's industrial valve industry shows a pattern of overcapacity of low-end industrial valves, full competition in the middle end industrial valve market, and monopoly of foreign enterprises in high-end and special industrial valve markets. It is expected that the improvement of the prosperity of the downstream industry will drive the increase of related fixed assets investment, and further drive the growth of demand for industrial valves. The above is all the contents of the industrial layout analysis of the industrial valve industry.
