The company released its 2023 annual report and 2024 quarterly report, with profits of -27%/-165%, respectively; the company's silicon wafer and module shipments continued to grow; second-generation HPBC components may be mass-produced in the second half of 2024; and the purchase rating was maintained.
Key points to support ratings
The company's performance in 2023 decreased 27.41% year on year: the company released its 2023 annual report, achieving full year revenue of 129.498 billion yuan, an increase of 0.39%; realized profit of 10.751 billion yuan, a year-on-year decrease of 27.41%; realized a deduction of 10.834 billion yuan for non-profit, a decrease of 24.84% year on year. Based on annual report data, 2023Q4 achieved profit of 942 million yuan, a year-on-year decrease of 124.57% and a month-on-month decrease of 137.46%.
The company's performance in the first quarter of 2024 decreased 164.61% year on year: the company released its 2024 quarterly report, and achieved revenue of 17.674 billion yuan in the first quarter, a decrease of 37.59% year on year; realized profit of -2350 billion yuan, a decrease of 164.61% year on year.
Impairment affects performance release: Affected by factors such as the continued decline in prices in the photovoltaic industry chain, the company has prepared for larger inventory impairment. According to data disclosed by the company, the amount of the company's asset impairment losses accrued in 2023/2024Q1 was 70.25/2,814 billion yuan, and large impairment charges affected the release of the company's performance.
Shipments of silicon wafers and modules continued to grow, and product profits remained stable: in 2023, the company achieved 125.42 GW of silicon wafers, an increase of 47.45%; module shipments were 67.52 GW, an increase of 44.40% year on year.
While maintaining the number one monocrystalline silicon wafer shipment volume in the world for nine consecutive years, the company achieved 53.79 GW of silicon wafers in foreign sales, an increase of 26.51% over the previous year. 2024Q1 achieved 26.74 GW of silicon wafer shipments, up 12.26% year on year; module shipments were 12.89 GW, up 16.55% year on year. The company's product profit remained stable. In 2023, the company's modules and batteries achieved a gross profit margin of 18.38%, an increase of 4.73 percentage points; silicon wafers and silicon rods achieved a gross profit margin of 15.88%, a year-on-year decrease of 1.74 percentage points.
Focusing on new BC technology, one generation of large-scale shipments and preparation for the second generation of mass production: By the end of 2023, the company's production capacity for high-efficiency HPBC batteries with an annual output of 29 GW in Xixian and 4 GW per year in Taizhou had been put into operation. The maximum conversion efficiency of the first-generation HPBC module Hi-Mo X6 reached 23.3%, which can stably achieve large-scale shipments exceeding 2 GW per month. 2024Q1 shipped 4.75GW of HPBC components to boost the company's distributed business. On May 7, 2024, the company released the Hi-MO 9 module. It is based on high-efficiency HPBC 2.0 battery technology. The maximum power of the Hi-Mo 9 module reaches 660W, and the conversion efficiency is as high as 24.43%. It is planned to be introduced to the market in the second half of 2024.
valuations
Based on the current industrial chain price, the company's current production capacity and production capacity plan, we adjusted the company's 2024-2026 forecast earnings per share to 0.54/0.83/1.08 yuan (the original 2024-2026 forecast was 2.96/3.49/- yuan), corresponding to a price-earnings ratio of 34.3/22.3/17.1 times; maintaining the purchase rating.
The main risks faced by ratings
International trade barriers risk; industry demand falling short of expectations; price competition exceeding expectations; PV policy risk; cost reduction falling short of expectations; technical cost performance falling short of expectations.