Approximately 55 GW of new wind power capacity is expected to be added in China in 2022. Nationwide power sector investment in 1-4M2022 totaled RMB206.6 bn, up YoY by 5.0%. In particular, power engineering investment and power grid investment reached RMB117.3 bn (+5.1% YoY) and RMB89.3 bn (+4.7% YoY), respectively. Wind power engineering investment in the period was down by 29.1% YoY to RMB33.2 bn but still accounted for approximately 28.3% of total power engineering investment. Newly installed wind capacity in 1-4M2024 was 9.58 GW (+45.2% YoY); and cumulative installed wind capacity nationwide at the end of April 2022 reached 338.26 GW, up 17.7% YoY.
Operating results in 1Q2022 largely in line with our expectation. Revenue in the first quarter of 2022 dropped 8.3% YoY to RMB6,383 mn, while net earnings went up 15.3% YoY to RMB1,265 mn. During the first 3 months of 2022, WTG external sales reached 1,411 MW, up YoY by 29.7%. In which, 2S-series, 3S/4S-series and MSPM-series products represented 34.0%, 55.2% and 10.8% of the sales mix in 1Q2022, respectively. Orders backlog at the end of March 2022 reached 16.97 GW, with 16.5 GW of external orders and 0.5 GW of internal orders. The 3S/4S-series and MSPM-series products made up 51.2% and 33.0% of external orders, respectively. Consolidated gross margin of Goldwind in 1Q2022 went down 3.1 ppt YoY to 26.5%, while net margin increased 4.0 ppt YoY to 19.8%.
We maintain the "Buy" rating for Goldwind but adjust our TP to HK$17.00. The new TP corresponds to 16.1x/ 15.2x/ 14.3x 2022 to 2024 PER or 1.5x/ 1.4x/ 1.3x 2022 to 2024 PBR, respectively.