Key points of investment
Superconducting magnetic field single crystal furnace: signed a strategic cooperation agreement with Western Superconductor to improve the upstream superconducting magnetic field layout, according to the company's official WeChat account
1) Signing a strategic cooperation agreement to improve the superconducting magnetic field layout: On June 5, the company signed a strategic cooperation agreement with Western Superconductor in Xi'an, which will speed up the company's supply of photovoltaic+semiconductor superconducting magnetic field production capacity. At present, the company has signed an order for 3,500 units of its fifth-generation monocrystalline furnace, and is expected to be equipped with nearly 300 superconducting magnetic fields this year.
2) Strong cooperation with domestic superconducting magnetic field leaders is expected to accelerate the development of new products. Western Superconductor is a leading domestic and internationally advanced R&D and manufacturer of superconducting materials, superconducting magnets, high-end titanium alloys, and high-performance superalloys. It has now formed the world's first full-process R&D and production base for superconducting ingot bars, wires, and magnets. The company's fifth-generation photovoltaic monocrystalline furnace will introduce superconducting magnetic field technology on a large scale (previously used in semiconductors) to help the efficiency breakthrough of photovoltaic N-type batteries. We expect this cooperation to strengthen the production capacity guarantee, cost optimization, technology upgrading, and market breakthroughs of the company's superconducting magnetic field monocrystalline furnaces.
3) It is expected that 2023 will be a year where the company will blossom more and new business will accelerate: expect the company's photovoltaic equipment (silicon wafer+battery+module) +consumables (crucible, diamond wire), semiconductor equipment (silicon wafer+wafers and packaging), and silicon carbide materials (6+8 inch substrate), leading to an increase in the company's orders+performance.
Pan-semiconductor “equipment+materials” leader, platform-based layout space continues to open 1) Photovoltaic equipment: The company is a leader in photovoltaic monocrystalline furnaces, and has accelerated expansion into the fields of photovoltaic cell+module equipment, quartz crucibles (leading the leader), and diamond wire consumables, opening the second largest growth curve in the photovoltaic business.
2) Semiconductor equipment: large silicon chip equipment - The company has achieved full coverage of 8-inch equipment in crystal growth, slicing, polishing, CVD, etc., and equipment such as 12-inch long crystals, slicing, grinding, polishing, thinning, etc. have been sold in batches, and the products have reached the international advanced level. Power semiconductor equipment - The company's orders for monolithic 6-inch silicon carbide epitaxial equipment grew rapidly and successfully developed industry-leading 6-inch two-chip silicon carbide epitaxial equipment.
3) Silicon carbide: Technical side: The company's 8-inch N-type SiC substrates will be produced in small batches. Client: The company has formed a purchase intention with customer A (company announcement), and priority will be given to providing them with a total of no less than 230,000 silicon carbide substrates from 2022 to 2025. Production capacity side: The company plans to build an annual production capacity of 400,000 conductive and insulating silicon carbide substrates of more than 6 inches in Yinchuan, Ningxia. A research and development test line for growing, slicing, and polishing 6-8 inch silicon carbide crystals has also been built. Gradually achieve autonomous control of large-size silicon carbide crystal growth+processing technology.
4) Sapphire: The company has grown the world's leading 700kg sapphire crystal, gradually increasing the large-scale mass production grade from 300kg to 450kg. Promote the increase in production capacity of the subsidiary Ningxia Xinjingsheng and strengthen its scale advantage.
Investment advice: Optimistic about the company's future performance in the fields of photovoltaics, semiconductors, silicon carbide, and sapphires, the company's net profit for 2023-2025 is 47.5/58.3/70.3 billion yuan, an increase of 63%/23%/21% over the previous year, and the corresponding PE is 18/15/12 times. Maintain a “buy” rating.
Risk warning: The progress of semiconductor equipment research and development has fallen short of expectations; the expansion of downstream photovoltaic production falls short of expectations.