The company released the third quarter of 2023, the third quarter of 2023 results continued to improve, and better than expected. In the first three quarters of 2023, the company achieved revenue of 1.767 billion yuan, up 169.19% from the same period last year; net profit from home was 236 million yuan, up 90.84% from the same period last year; and net profit from non-return was 218 million yuan, up 85.93% from the same period last year. Although the company is currently affected by the low price of the hot field, the performance has been greatly improved by the strength of its quartz crucible plate. In 2023, Q3 achieved revenue of 795 million yuan, an increase of 213.55% over the same period last year, a net profit of 105 million yuan, an increase of 102.85% over the same period last year, and a net profit of 98 million yuan, an increase of 105.46% over the same period last year. The performance growth rate is better than expected in the off-season environment of traditional industries.

The performance in the third quarter of 2023 is higher and better than expected, and the quartz crucible plate is expected to continue to develop in the later period. In the first three quarters of 2023, the company achieved revenue of 1.767 billion yuan, up 169.19% from the same period last year; net profit from home was 236 million yuan, up 90.84% from the same period last year; and net profit from non-return was 218 million yuan, up 85.93% from the same period last year. Although the company is currently affected by the low price of the hot field, the performance has been greatly improved by the strength of its quartz crucible plate. In 2023, Q3 achieved revenue of 795 million yuan, an increase of 213.55% over the same period last year, a net profit of 105 million yuan, an increase of 102.85% over the same period last year, and a net profit of 98 million yuan, an increase of 105.46% over the same period last year. The performance growth rate is better than expected in the off-season environment of traditional industries. During the reporting period, in terms of carbon and carbon products, the company promoted the implementation of large-scale deposition equipment, continuous high-temperature equipment, intelligent key processes and automatic process connection. The production capacity of carbon and carbon thermal field products of the company has reached 5500 tons, which can meet the mass production of 36-inch or larger products. at present, 10 deposition furnaces with a diameter of more than 8 meters have been debugged and officially put into use.

The company carbon thermal field capacity landing + technical equipment upgrading, carbon photovoltaic thermal field cost advantage will continue to help expand the market. During the reporting period, the company steadily landed 2000 tons of carbon-carbon composite production capacity, and the company completed the construction of preform intelligent acupuncture production line, it is worth mentioning that the company's third-generation intelligent acupuncture equipment has been installed and process verification has been completed, which further improves the consistency of preform production capacity and quality. By the end of the reporting period, the company's customer expansion in downstream photovoltaic wafer manufacturers has been smooth and has been officially supplied to 12 photovoltaic wafer manufacturers, including JinkoSolar Holding Co Ltd, Longji Green Energy, Trina Solar, Yongxiang Photovoltaic, Jing O Technology, Gaojing Taiyang Energy and Meike Solar. The company's current cost is already in a leading position in the industry and will help it expand the market in the future.

The quartz crucible production line is fully built, and the construction progress is in line with expectations, which will help the company to increase its performance in the difficult market in the future. During the reporting period, Jiangsu Xinlieyang, a subsidiary of the company, has completed the construction and production of No. 7 and No. 8 quartz crucible production lines, including the six production lines that have been built before, there are a total of 8 production lines in Jiangsu Xinliyang. At the same time, the company's subsidiary, Sichuan Jiangyou Tianqi Yiyang, plans to build 20 quartz crucible production lines within 2023. At present, 10 production lines have been installed and entered the trial production link, and are expected to be fully put into use in the second quarter of 2024. Quartz crucible business and carbon-carbon thermal field business are highly coordinated, and will be committed to providing customers with more comprehensive auxiliary materials services in the future, forming a differentiated competitive advantage. It will help the company to achieve high performance in the hard-to-find market in the next 2-3 years.

Earnings forecast and investment rating: the company's quarterly results in the third quarter of 2023 exceeded expectations, and the Q1-3 performance was basically in line with expectations, although the whole industry is mainly affected by the low price of carbon and carbon thermal field. However, the company is expected to achieve high annual performance by virtue of its cost advantage and quartz crucible business. We maintain the company's profit forecast for 2023-2025. It is estimated that the company's return net profit for 2023-2025 will be 442 and 625 million respectively. The current price corresponds to the PE of 29-20-15, maintaining the "overweight" rating.

Risk hints: the competition pattern of photovoltaic thermal field continues to deteriorate, the construction progress of quartz crucible production line is not as expected, and the market development of carbon ceramic brake disk is not as expected.