2027 Outlook: Valuation reset; prefer AI robotics, DC Electricals vs. Grid Tech

Goldman Sachs refreshes its China Industrial Tech preferences into 2027E, seeing growth opportunities diverge in timing and earnings visibility. Aggregate OEM growth is expected to moderate to about 3% in 2027E from +7% in 2026E, yet semiconductors, electronics and AI infrastructure remain supportive, alongside stabilizing process industries, replacement demand in general industries, and emergent demand from AI-enabled intelligent hardware such as robots and AI glasses. Advances in frontier LLMs for physical AI, particularly zero-/few-shot generalization, could accelerate real-world robotics deployment. In the AI robotics supply chain, China IA market is forecast to grow 1% yoy in 2027E with the project market flat, favoring Inovance, Sanhua-H and Shuanghuan. For Data Center Electricals, ex-China progress remains solid but slower than expected while China demand gradually recovers with easing chip supply, and the 800VDC transition toward mass production is now seen more likely from 202