The Ministry of Industry and Information Technology, the National Development and Reform Commission, and the Ministry of Environmental Protection recently issued the "Private Industry Access Conditions". The "Access Conditions" stipulates that polysilicon projects should conform to the national industrial policy, land use policy and industry development plan. Before the new catalogue for government investment projects is approved, The new polysilicon project is no longer approved in principle. However, projects that are necessary to strengthen technological innovation, promote energy conservation and environmental protection, etc., shall be reported to the investment department of the State Council for organization and demonstration.
We believe that after the introduction of the entry standard, the polysilicon industry will be ushered in integration, and some smaller, lower-tech polysilicon production capacity will be eliminated. Companies with cost and technological advantages will stand firmer in the market. It may be closer to the oligopoly. At the same time, the newly added capacity is not likely to increase rapidly due to the need to pass the approval process.
Polysilicon stocks or staged investment opportunities
After the plunge in polysilicon prices in 2008, domestic and foreign polysilicon manufacturers slowed down the pace of capacity expansion, resulting in few new capacity in 2009 and 2010. The 2010 scale PV projects installed ultra expected to double growth, coupled with the amount of electronic grade polysilicon is also very boom, the global polysilicon market serious shortage situation. This directly led to the sharp increase in polysilicon prices from $56/kg to nearly $100/kg since July 2010.
As of the beginning of November 2010, public data showed that the major international polysilicon manufacturers planned to expand production by 18% in 2011, while the domestic major manufacturers expanded by 25%. Based on estimates, in 2011 the global polysilicon production capacity expansion by about 20%, production capacity of about 250,000 tons of production capacity to serve 80% of the estimate, the global polysilicon production is about 20 million tons, to remove the electronic grade silicon is 3.5 Ten thousand tons, the amount of silicon available for solar cells is 165,000 tons.
With 21 GW of photovoltaic solar project installed this year, 16% of the film market share was removed, and the installed capacity of crystalline silicon cells was 17.6 GW. With a silicon content of 7 g per watt and a silicon wafer cutting loss of 20%, the demand for polysilicon is 155,000 tons. Although from the data point of view, the supply level of 165,000 tons this year exceeds the demand of 10,000 tons, but considering that the actual trading activities will not be fully lubricated, and the release of capacity may be a gradual process, this year, polysilicon may still have staged supply shortages. Especially in the first half of the year when capacity cannot be fully released. Therefore, the relevant stocks may have staged investment opportunities.
It is worth noting that since December last year, mainstream manufacturers at home and abroad have significantly increased their production expansion targets. We believe that from 2012 onwards, polysilicon supply pressure will be gradually released, and silicon prices may enter a continuous downward channel.
The supply of polysilicon is still tight
As most of the downstream battery component manufacturers have expanded more than 50%, and some even reached 100%, the market is worried that the battery component will be oversupplied in 2011, which will lead to competition. We believe that from the perspective of existing policies, the terminal system is inevitably in the price reduction channel in 2011, but the possibility of large price hikes for battery components is relatively small. The main reasons are as follows: (1) From the perspective of market demand in 2011, The main source of growth is outside Germany. Considering that the current solar power grid price level in Germany has been relatively low, the increase in demand share outside Germany will help ease the price pressure; (2) the supply of polysilicon will remain tight this year, and the silicon material will continue to be released from downstream capacity. bottleneck.
Recently, the long-term price of polysilicon continued to rise, and the behavior of downstream manufacturers to sign large single-sheets of silicon materials frequently appeared, indicating that silicon materials may not be able to be mass-produced in the short term. Therefore, we believe that the output of battery components this year will be subject to the supply of silicon, and the actual output will be much lower than the capacity of downstream manufacturers.
Nevertheless, we believe that the pressure reduction of downstream battery components will be greater than that of upstream silicon wafers, especially considering that the supply of silicon is still tight. In the short term, downstream manufacturers are still expected to maintain profitability by squeezing costs. However, in the long run, the trend of price change will become more and more obvious, and the downstream link gross profit will be unavoidable. Therefore, we believe that the profit expansion rate of the downstream industry chain will probably lag behind the growth rate of the industry. Especially for some downstream companies with high valuations, unless the demand continues to exceed expectations, it is difficult for their profitability to maintain high growth, and they are cautious about their future share price movements.
The whole industry chain company has more advantages
This year's tight polysilicon supply may push up the silicon price temporarily, which will bring the trading opportunities of polysilicon related targets. However, the long-term investment value of polysilicon manufacturers depends on the cost reduction. At present, the prospect of A-share polysilicon company is still unclear. . The downstream manufacturers will enter the long-term channel of price conversion, and we are cautious about the return on investment as the profit growth momentum is gradually slowing down. In contrast, integrated vendors with economies of scale are more likely to win in cost competition.
From the perspective of the industrial chain of production, domestic manufacturers have obvious cost advantages in the battery component. From the perspective of cost integration, the integration of the silicon-battery-component link will be a trend for downstream manufacturers. In the next five years, the integration of the solar market will leave manufacturers with cost advantages, and the manufacturers who have laid out the entire industry chain will have obvious advantages in cost compression than the specialized manufacturers in a single link. At the same time, we also see that domestic battery component manufacturers including sunflowers are actively deploying wafer business. In addition, scale is an important means of reducing costs, and manufacturers with scale advantages are more likely to have room for survival and development. Among the listed companies in the A-share market, it is recommended to focus on low-cost and technologically advantageous companies , including Tianwei Baobian, TBEA, CSG A, Aerospace Electromechanical, Sichuan Investment Energy , and Leshan Power. (Great Wall Securities Monita Company)
We believe that after the introduction of the entry standard, the polysilicon industry will be ushered in integration, and some smaller, lower-tech polysilicon production capacity will be eliminated. Companies with cost and technological advantages will stand firmer in the market. It may be closer to the oligopoly. At the same time, the newly added capacity is not likely to increase rapidly due to the need to pass the approval process.
Polysilicon stocks or staged investment opportunities
After the plunge in polysilicon prices in 2008, domestic and foreign polysilicon manufacturers slowed down the pace of capacity expansion, resulting in few new capacity in 2009 and 2010. The 2010 scale PV projects installed ultra expected to double growth, coupled with the amount of electronic grade polysilicon is also very boom, the global polysilicon market serious shortage situation. This directly led to the sharp increase in polysilicon prices from $56/kg to nearly $100/kg since July 2010.
As of the beginning of November 2010, public data showed that the major international polysilicon manufacturers planned to expand production by 18% in 2011, while the domestic major manufacturers expanded by 25%. Based on estimates, in 2011 the global polysilicon production capacity expansion by about 20%, production capacity of about 250,000 tons of production capacity to serve 80% of the estimate, the global polysilicon production is about 20 million tons, to remove the electronic grade silicon is 3.5 Ten thousand tons, the amount of silicon available for solar cells is 165,000 tons.
With 21 GW of photovoltaic solar project installed this year, 16% of the film market share was removed, and the installed capacity of crystalline silicon cells was 17.6 GW. With a silicon content of 7 g per watt and a silicon wafer cutting loss of 20%, the demand for polysilicon is 155,000 tons. Although from the data point of view, the supply level of 165,000 tons this year exceeds the demand of 10,000 tons, but considering that the actual trading activities will not be fully lubricated, and the release of capacity may be a gradual process, this year, polysilicon may still have staged supply shortages. Especially in the first half of the year when capacity cannot be fully released. Therefore, the relevant stocks may have staged investment opportunities.
It is worth noting that since December last year, mainstream manufacturers at home and abroad have significantly increased their production expansion targets. We believe that from 2012 onwards, polysilicon supply pressure will be gradually released, and silicon prices may enter a continuous downward channel.
The supply of polysilicon is still tight
As most of the downstream battery component manufacturers have expanded more than 50%, and some even reached 100%, the market is worried that the battery component will be oversupplied in 2011, which will lead to competition. We believe that from the perspective of existing policies, the terminal system is inevitably in the price reduction channel in 2011, but the possibility of large price hikes for battery components is relatively small. The main reasons are as follows: (1) From the perspective of market demand in 2011, The main source of growth is outside Germany. Considering that the current solar power grid price level in Germany has been relatively low, the increase in demand share outside Germany will help ease the price pressure; (2) the supply of polysilicon will remain tight this year, and the silicon material will continue to be released from downstream capacity. bottleneck.
Recently, the long-term price of polysilicon continued to rise, and the behavior of downstream manufacturers to sign large single-sheets of silicon materials frequently appeared, indicating that silicon materials may not be able to be mass-produced in the short term. Therefore, we believe that the output of battery components this year will be subject to the supply of silicon, and the actual output will be much lower than the capacity of downstream manufacturers.
Nevertheless, we believe that the pressure reduction of downstream battery components will be greater than that of upstream silicon wafers, especially considering that the supply of silicon is still tight. In the short term, downstream manufacturers are still expected to maintain profitability by squeezing costs. However, in the long run, the trend of price change will become more and more obvious, and the downstream link gross profit will be unavoidable. Therefore, we believe that the profit expansion rate of the downstream industry chain will probably lag behind the growth rate of the industry. Especially for some downstream companies with high valuations, unless the demand continues to exceed expectations, it is difficult for their profitability to maintain high growth, and they are cautious about their future share price movements.
The whole industry chain company has more advantages
This year's tight polysilicon supply may push up the silicon price temporarily, which will bring the trading opportunities of polysilicon related targets. However, the long-term investment value of polysilicon manufacturers depends on the cost reduction. At present, the prospect of A-share polysilicon company is still unclear. . The downstream manufacturers will enter the long-term channel of price conversion, and we are cautious about the return on investment as the profit growth momentum is gradually slowing down. In contrast, integrated vendors with economies of scale are more likely to win in cost competition.
From the perspective of the industrial chain of production, domestic manufacturers have obvious cost advantages in the battery component. From the perspective of cost integration, the integration of the silicon-battery-component link will be a trend for downstream manufacturers. In the next five years, the integration of the solar market will leave manufacturers with cost advantages, and the manufacturers who have laid out the entire industry chain will have obvious advantages in cost compression than the specialized manufacturers in a single link. At the same time, we also see that domestic battery component manufacturers including sunflowers are actively deploying wafer business. In addition, scale is an important means of reducing costs, and manufacturers with scale advantages are more likely to have room for survival and development. Among the listed companies in the A-share market, it is recommended to focus on low-cost and technologically advantageous companies , including Tianwei Baobian, TBEA, CSG A, Aerospace Electromechanical, Sichuan Investment Energy , and Leshan Power. (Great Wall Securities Monita Company)
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