23Q3 realized a net profit of-40 million yuan, a year-on-year loss reduction of 30 million yuan. 23Q1-Q3 achieved operating income of 3.95 billion yuan, down 4% from the same period last year, and realized net profit of-80 million yuan, down 156% from the same period last year.

Corresponding to 23Q3, the company achieved an operating income of 1.55 billion yuan in a single quarter, an increase of 18% over the same period last year and 48% from the previous quarter. The net profit returned to the mother was-40 million yuan, a loss reduction of 30 million yuan over the same period last year, and a loss reduction of 20 million yuan from the previous year. Affected by the decline in the order price of products at the end of 23Q3 and the high inventory cost, based on the principle of prudence, 23Q3 set aside 80 million yuan for inventory price reduction.

Film shipments significantly increased month-on-month, continue to dig deep into the TOPCon packaging technology reserve. We estimate that 23Q3's film shipments are 180 million square meters, an increase of about 60% month-on-month compared with the previous month. 23Q1murQ3 shipments are about 450 million square meters, exceeding the annual shipments in 2022. The net profit of 23Q3 is-0.22 yuan, and the loss is reduced by 0.30 yuan compared with the previous month. The head enterprise maintains the share priority strategy, the film price enters the bottom operation range, as the tail production capacity continues to clear, the future industry competition pattern is expected to improve. 23Q1-Q3, the company continues to resist PID EVA film, white synergistic EVA film, synergistic co-extruded POE film, multi-product POE film performance in-depth research and continue to improve product quality, especially in the TOPCon matching film technology direction has made good progress. The company increased the category of single-layer POE film and focused on improving the defects such as easy skidding and bumping of POE film, and successfully developed EXP type and iterative EPE co-extruded POE film products, which can greatly reduce the amount of POE resin while ensuring the hydrolysis resistance of the film, and make a good technical reserve for the rapid development of TOPCon components in the future.

Join hands with Dow to carry out in-depth cooperation in POE products, focusing on the automotive new materials market. The company has added new electronic functional films such as dimming film for intelligent glass of new energy vehicles, as well as new products such as temperature and noise reduction PVE glass adhesive film. at the same time, new environmentally friendly surface materials for automobile intelligent cockpit have also made good progress. In addition, the company signed a cooperation memorandum with Dow Chemical (China) Investment Co., Ltd. Dow China will provide support to the company in the development of POE resin and the stable supply of POE products, with a view to establishing a deeper cooperative relationship between the two sides and jointly promote the growth of POE in the automotive intelligent cockpit surface materials market.

Risk tips: intensified competition in the industry; fluctuations in raw material prices; production progress is not as expected.

Investment suggestion: considering the pricing strategy of the company's photovoltaic film business under the current competitive situation and the influence of large fluctuations in the price of raw material EVA particles, the profit forecast for 2023-2025 is lowered. It is estimated that the income for 2023-2025 will be 55.8x6pm (the original forecast for 2023-2025 is RMB85.6120.9pm), which represents a year-on-year growth rate of 5%, 19% and 18%. The net profit of return to the home is 0.50 max 2.21 trillion yuan (the original forecast for 2023-2025 is 5.31 pound 8.02 billion yuan), a year-on-year growth rate of 1%, 337%, 18%. Diluted EPS=0.60/2.62/3.09 yuan, the current share price corresponds to PE=116/26/23x, maintaining a "buy" rating.