14-year guidelines. The 14-year guidelines for year-end production capacity and annual shipments of N-type wafers are 700 MW and 600 MW, respectively. The price of N-type silicon wafers is expected to be around $0.30 per watt. The cost of wafer processing may fall to $0.12 per watt by the end of the year with the help of the diamond line. After 13 years of prepayment impairment, the company's 14-year overall gross profit margin will rebound.

The relationship between supply and demand has improved, and the price of silicon wafers has been stable. The price of monocrystalline silicon wafers has been stable recently, and our channel research shows that there is a strong demand for silicon wafers in the market. Our research on major domestic polysilicon manufacturers such as Poly Xiexin and Daquan shows that the price of polysilicon for the rest of 14 years may be 20-23 US dollars per kilogram. We think this is good for Kamdanke's profit margin. We cut wafer shipments by 15% in fiscal year 14-15. Management explained that Kamdanke's market share was affected after other wafer manufacturers, especially Poly Xiexin, intervened in P-type monocrystalline silicon wafers. The company will further focus on N-type monocrystalline silicon wafer business. Further capacity expansion in Malaysia still needs clearer guidance from new customers.

We lowered the target price to HK $1.70 to maintain the "collection" rating. We adjust the company's operating assumptions and reduce the company's 14-year / 15-year net profit per share by 29% per share by 35%. Our 16-year earnings per share target is 0.107 yuan. The new target price is equivalent to 24 times / 15 times 14 / 15 years price-to-earnings ratio. We believe that Kamdanke's gross profit margin will rebound and its N-type monocrystalline silicon wafer sales will grow steadily with the industry trend. Maintain the "collection" rating based on the improvement of the company's fundamentals.