This article is from Everbright Securities, author: he Gen, Yin Zhong, Hao Qian.
Events:Poly Xiexin Energy (03800)Announcement, Jiangsu Zhongneng, a wholly-owned subsidiary,Wuxi Shangji CNC Co., Ltd.A strategic cooperation framework agreement was signed to jointly invest in the R & D and production project of 300000 tons of granular silicon in Inner Mongolia Autonomous region, with a total investment of 18 billion yuan (RMB). The project will be implemented in three phases, with a total design capacity of 60, 000 tons and a planned investment of 3.6 billion yuan (RMB). The two sides plan to cooperate through the establishment of a joint venture, with Jiangsu Zhongneng holding 65% and Shangji CNC holding 35%. At the same time, the company announced that Leshan Sumin, a wholly-owned subsidiary, as the main body of the construction of Leshan granular silicon project (the first phase of 60,000 tons) will successfully introduce strategic investors to increase investment in Leshan granular silicon.
Join hands with CNC to promote the large-scale commercialization of granular silicon:FBR granular silicon technology is a photovoltaic polysilicon technology independently developed by the company for many years since 2010. Compared with the current market mainstream improved Siemens process, granular silicon technology has the advantages of low energy consumption and continuous production, and is expected to become the next generation of photovoltaic silicon technology. At present, the company's granular silicon technology has achieved stable mass production, and achieved the quality verification of downstream customers. Since the second half of 2020, the company's granular silicon products have become an effective supplement to the mainstream rod silicon in the market. The capacity bottleneck is one of the main factors restricting the commercialization and promotion of the company's granular silicon technology. at present, the company's granular silicon production capacity is only 10,000 tons of Xuzhou's, and the company will continue to promote the granular silicon production capacity in Xuzhou and Leshan from 2021 to 2022. The company announced that, together with CNC, the R & D and production project of 300000 tons of granular silicon in Inner Mongolia will help to accelerate the large-scale commercialization of the company's granular silicon technology.
The silicon business is expected to usher in a new situation of rising volume and price:A new round of production expansion appeared in the photovoltaic market in the second half of 2020, and the capacity of downstream silicon wafers, battery wafers and modules was greatly expanded. Due to the characteristics of heavy assets, long production expansion cycle (about 1-2 years) and low capacity elasticity, silicon production expansion lags behind seriously. According to Solarzoom data, the total production capacity of domestic wafers, batteries and modules is expected to reach 370-400GW by the end of 2021, while the corresponding silicon production capacity is only 250GW level. At present, photovoltaic silicon has entered the price cycle, the tight balance situation is expected to continue in the future. The company's silicon bistatic strategy has become a global benchmark for high-quality, low-cost polysilicon manufacturing, and the company is expected to significantly benefit from the trend of tight balance between supply and demand in the industry in 2021.
Earnings forecasts, valuations and ratings:The net profit of the maintenance company from 2020 to 2022 is-16.38,20.98 and 3.216 billion yuan respectively, corresponding to the EPS of-0.08,0.08,0.13 yuan, and the target price is 4.1Hong Kong dollars (2022 PE is 27x). Based on the tight balance of silicon supply in the future and the company's breakthroughs in granular silicon technology, it is optimistic that the company's performance in 2021 is expected to reverse the past decline and enter a new round of growth cycle, so it maintains a "buy" rating.
Risk hints: industry fluctuation risk; order fulfillment risk; risk of loss of core technical personnel; risk of technology substitution, underproduction of fund-raising projects, etc.
(editor: Zhang Jinliang)