Tongwei (600438): Strong expansion of silicon materials and battery steadies
The company announced plans to expand the production of silicon materials and batteries, and plans to expand the capacity of silicon materials by 2 to 25 inches and the battery capacity by 4 times to 100 GW within 4 years.After years of competition in the silicon material and battery industries, the industry structure is clear.The silicon material industry may basically have only five factories left this year. Tongwei overcomes costs, quality, and rapid expansion of capital advantages, and is expected to become a silicon material oligarch.The battery series Tongwei is in the industry’s first echelon in terms of cost, efficiency and scale, and efficiency improvement and cost reduction are still underway. This round of production expansion will accelerate the exit of the industry’s second- and third-line power generation, and Tongwei’s market share will still beWill be further improved, Tongwei leading faucet will be more stable.Maintain “Highly Recommended-A” rating, raise target price to 18-20 yuan, corresponding to 18 PE in 2020.6-20.6 times. Relying on the cost advantage of silicon materials, we will resolutely expand production and consolidate the leading grade.Silicon material is in the chemical industry state. After a large adjustment in 2018-2019, the second-line capacity has generally expanded, and domestic second-line capacity and overseas capacity are exiting.Hanwha OCI ‘s Gunsan base in South Korea has just announced that it will convert most of its silicon capacity to electronic grade silicon. WACKER has also made a significant impairment of its silicon assets and is preparing to convert part of its capacity to electronic grade silicon. We expect that the supply and demand pattern of silicon materials will improve in the next five quarters, and the industry pattern will become clearer. In the future, there will only be Tongwei, Daquan, Xinte, GCL, and Oriental Hope five.At present, the effective production capacity of the five companies is about 8 and the cost is the lowest. The company’s expansion of about 16 plants will open a gap with the other four. A variety of technical routes are concurrently targeted at 100GW high-efficiency crystalline silicon cells.The company’s current battery capacity is 20GW, which is already the first in the world, but the current market share is only 10%.The expansion plan will maintain an expansion rate of 20GW per year, with a target of 100GW, and the advantages in scale will be more prominent.On the technical route, the company ‘s average capacity for new production capacity retains the upgrade interface of PERC + and TOPCon. At the same time, Jintang ‘s 30G expansion plan replaces 15GW of space with new technologies such as HJT. In the future, the timing of investment is determined by the maturity of 南京桑拿网 domestic equipment.The investment is still dominated by M12’s PERC. Actively embracing M12 large silicon wafers, M12 is expected to further expand the profitability of the wide industry.According to company estimates, capital expenditure per unit of throughput is expected to continue to decline after the introduction of M12 large silicon wafers.At the same time, due to the existence of flux value, the non-silicon cost of the battery will increase by 1-2 cents / watt on the basis of M6, and the BOM cost between components also has room to fall. M12 is expected to create value for the industry, so the company’s new battery production in the futureThe lines will match M12 silicon wafers, and are backward compatible with M6, G1, M4, M2 and other models, as well as new technology routes such as PERC +, TOPCon, HJT. Investment suggestion: It is expected that the net profit attributable to mothers in 2019-2021 will be 28.1/37.4/48.60,000 yuan, maintain “strongly recommended-A” rating, adjust the target price of 18-20 yuan. Risk warning: domestic installed capacity is less than expected, overseas demand is less than expected, new technology shocks