\u3000\u3000 Shuangliang Eco-Energy Systems Co.Ltd(600481) (600481)
New orders for polysilicon equipment and large-size silicon wafers were signed, and the large-size silicon wafers were recognized by the head enterprise
Today, the company announced the reduction furnace equipment order of 262 million yuan (including tax, the same below) to Baofeng silicon materials, and the long-term sales contract of 1.892 billion 210 monocrystalline silicon chips (estimated sales of 15.95 billion yuan) to Trina Solar Co.Ltd(688599) from 2022 to 2024.
The large-size silicon wafer production capacity of Tianhe company has been fully recognized this time. Trina Solar Co.Ltd(688599) has always been a leading enterprise in integrated components. According to Sotheby PV, the shipment of Trina Solar Co.Ltd(688599) components in 2021 is about 25gw, ranking second in the world. At the same time, due to the large size of 210 silicon wafer, its fragmentation rate and warpage are high, and the production is difficult. Trina Solar locked nearly 1.921 billion silicon wafers to the company this time, which is enough to prove the strength of the company in silicon wafer production.
Monocrystalline silicon phase II agreement was signed and the monocrystalline silicon project was accelerated
On January 10, 2022, the company’s application for non-public offering of A-Shares (for the construction of 40gw monocrystalline silicon phase I Project (20GW)) was reviewed and approved by China Securities Regulatory Commission (the total investment scale of phase I project is 6.999 billion yuan), which was officially approved on January 22.
On January 28, the company issued the announcement on foreign investment and plans to sign the cooperation agreement of Baotou monocrystalline silicon phase II project, which plans to invest in Baotou phase II 20GW large-size monocrystalline silicon wafer project. The total investment of phase II project is 6.2 billion yuan.
The company’s rapid action in phase II fully shows that the company has sufficient raw materials, production capacity and orders. According to the company’s reply to the announcement on fixed growth, it is expected that the company’s production capacity will be gradually increased in February this year, and strive to achieve an annual production capacity of 7gw; In June, the construction of the second single crystal plant was completed; It is expected to reach the production capacity of phase I 20GW silicon wafer in March next year. Since October, the company has announced monocrystalline silicon business contracts with many photovoltaic companies. It is expected that 32500 tons of monocrystalline silicon square ingots / rods and 7.59 billion monocrystalline silicon chips will be sold from 2022 to 2024. The rapid implementation of phase II project is expected to continuously increase the company’s order receiving capacity.
There is no worry about the supply of raw materials, long sales orders are locked, the company has obvious advantages in the shuffle stage, and a successful breakthrough can be expected
With the technological change of photovoltaic industry, the decline of raw material prices and the elimination of backward silicon production capacity, the silicon link may usher in a new round of reshuffle. At this stage, we believe that the company has three advantages:
1. Pack light. The company’s production capacity is large-size silicon wafer production capacity, and there is no inventory of small-size silicon wafers, and there is no pressure such as asset impairment.
2. Worry free silicon material supply. As the leader of polysilicon equipment, the company has a natural cooperative relationship with silicon material enterprises, and has certain advantages in silicon material supply. At present, the company has locked in the supply of more than 160000 tons of silicon material.
3. The production capacity is recognized by many downstream parties, and the sales long order is locked to ensure the performance. From the single crystal furnace equipment contract announced by the company, the total procurement of single crystal furnace exceeds 3 billion yuan, corresponding to the production capacity of more than 20GW single crystal silicon, and the production capacity is worry free. At the same time, the company has obtained orders from multiple customers including Tongwei, Trina Solar and other leading enterprises, with sufficient performance guarantee.
Based on the above, we are optimistic about the long-term development of the company.
Investment advice
It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 288 million yuan, 742 million yuan and 1.194 billion yuan respectively, corresponding to the current PE of 59x / 23x / 14x respectively, which will continue to be recommended.
Risk tips
Macroeconomic downturn and market demand decline; The price of raw materials fluctuates sharply; Risk of policy changes in the photovoltaic industry.
