[matters]

On August 2, 2023, the first piece of Hongyuan Guangneng 16GW N-type TOPCon module, a subsidiary of the company located in Jiangyin City, Jiangsu Province, was successfully offline. The module is a TOPCon technology path 182 battery sheet 72 version double-sided double-glass module, while using SMBB superimposed half-chip technology, lossless cutting technology and high-density packaging technology, with higher double-sided rate, lower temperature coefficient and better weak light performance. the highest output power of the product can reach 585W, and the photoelectric conversion efficiency can reach 22.64%, reaching the leading level of the same type of components in the industry.

[comments]

The company's 16GW N TOPCon component factory officially started construction on March 31, 2023, and three factories were capped one after another in June-July. It took only more than 100 days to complete the construction, and was successfully put into production according to the planned time, demonstrating the "Hongyuan efficiency".

Based on crystal pulling and silicon wafer links, the company has been deeply vertically integrated since 2022, and batteries and components have been put into production as planned since Q3 in 2023. The newly built capacity has the advantage of backwardness, and the performance of N-type battery wafers and components has reached the industry-leading level. At present, the company has completed the key transformation of the layout of the middle reaches of the photovoltaic industry chain from 0 to 1, and the follow-up integration process is expected to accelerate development.

According to the company's capacity planning, we believe that the company's new production capacity in silicon materials, wafers, battery wafers and components is expected to be released one after another during the 2023Q3-2024Q1 period. if the relevant production capacity reaches production on time, the company will usher in a new breakthrough.

[investment advice]

We maintain our previous profit forecast for the company. From 2023 to 2025, we achieved operating income of 269.24 million yuan, 45.551 billion yuan, a year-on-year growth rate of 22.89%, 65.47%, 7.53%, and net profit of 40.09, 57.21, 60.55 billion yuan, up 32.19%, 42.69%, 5.83%. The EPS is 6.94, 9.90 and 10.48 yuan, respectively, and the corresponding PE is 7.19, 5.04, 4.76 times, respectively, maintaining the "over-holding" rating.

[risk Tip]

Downstream demand is lower than expected

The production capacity is less than expected.

Large fluctuations in the price of the industrial chain affect the profit space.