Investment view: the fundamentals are healthy and stable, and the attraction of the sector is gradually highlighted
This week, the photovoltaic sector made a slight correction. From the perspective of fundamentals, the increase of silicon material price exceeds the expectation and continues to drive the rise of silicon wafer price, which is mainly due to the increase of downstream operating rate and the short-term supply-demand mismatch caused by the impact of the earthquake. In the long run, the price of the industrial chain is expected to continue to decline, and the overall fundamentals will continue to remain healthy and stable. In 2021, China's PV installed capacity increased by 53gw. It is expected that the installation of some ground power stations will be delayed until 2022. In the short term, we still suggest to focus on the implementation of delayed installation and the production of silicon material capacity in the first quarter, and be optimistic about the market in the off-season of the first quarter. After adjustment, the valuation attraction of the overall sector is gradually highlighted.
Looking forward to the whole year, with the downward price of the industrial chain, the demand for photovoltaic in 2022 is easy to exceed expectations. Driven by the trend of carbon neutralization and the economy of the industrial chain, it has high growth potential in the medium and long term, and the power equipment industry is rated as "overweight". However, it is worth noting that the substantial expansion of production in the industry may lead to a normalized surplus in most links, and the pattern is affected to a certain extent. We suggest giving priority to the pattern of subdivided links and the implementation of new technologies. 1) Glass and diamond wire have significant cost advantages, focusing on Flat Glass Group Co.Ltd(601865) (A / h), Xinyi light energy, Yangling Metron New Material Co.Ltd(300861) , Henan Hengxing Science & Technology Co.Ltd(002132) . 2) Inverter soft magnetic particle core and high-purity quartz sand have significant product differences. Pay attention to Poco Holding Co.Ltd(300811) , Jiangsu Pacific Quartz Co.Ltd(603688) . 3) There are profitable repair opportunities for battery components, adhesive films and tracking brackets. Pay attention to Longi Green Energy Technology Co.Ltd(601012) , Ja Solar Technology Co.Ltd(002459) , Trina Solar Co.Ltd(688599) , Hangzhou First Applied Material Co.Ltd(603806) , Shanghai Hiuv New Materials Co.Ltd(688680) , Arctech Solar Holding Co.Ltd(688408) , Shanghai Aiko Solar Energy Co.Ltd(600732) . 4) Pay attention to the technological change opportunities brought by new technologies such as n-type battery and granular silicon, poly GCL energy, etc.
Industry dynamics: 53gw of photovoltaic was added in 2021, and the price of Longji silicon wafer increased by 5.13%
Industry trends: 1) Energy Administration: 53gw of photovoltaic power was added in 2021, with a cumulative breakthrough of 300 million KW. 2) The State Council issued documents to encourage the rational layout of photovoltaic power generation along transportation hubs, stations, roads and railways; 3) In the 14th five year plan, 12 new UHV will drive a large number of new energy bases; 4) Zhejiang: the grid connected photovoltaic in the 14th five year plan will be fully included in the supporting scale, with 5GW of construction started in 2022 and 4.5gw of grid connected; 5) Shanghai: by 2023, the peak installed power of Cecep Solar Energy Co.Ltd(000591) photovoltaic in public institutions in the city will reach 50000 kW.
Company dynamics: 1) Longji silicon wafer rose by 0.12 yuan / piece - 0.3 yuan / piece, with the highest increase of 5.13%; 2) Shuangliang Eco-Energy Systems Co.Ltd(600481) signed a framework contract for the procurement of 1.048 billion silicon wafers with Tongwei Cecep Solar Energy Co.Ltd(000591) ; 3) Central semiconductor announced the commencement of two major projects, with a total investment of 8.2 billion yuan; 4) Trina Solar Co.Ltd(688599) in 2021, the net profit attributable to the parent company increased by 39.92% - 66.76% in advance; 5) In 2021, Longji maintained the first place in the shipment of components, and the shipments of top 5 manufacturers were more than 10GW.
Industrial chain tracking: the upstream price of the supply chain increases, and the component price is temporarily stable
Silicon material: the price range of China's single crystal re feeding this week was 230000-247000 yuan / ton, and the average transaction price rose to 240000 yuan / ton, up 2.30% month on month; The price range of single crystal compact is 228000-245000 yuan / ton, and the average transaction price rose to 237600 yuan / ton, up 2.19% month on month. The price of silicon material continued to rise this week. The supply is less than expected, superimposed with the growth of downstream demand. It is expected that the silicon material will continue the operation trend of relatively stable and slight rise before the Spring Festival, and the price after the festival will depend on the extension of the installation outside China from 2021 to 2022. Silicon wafer: the average transaction price of 166mm single crystal silicon wafer in China this week was 5.15 yuan / piece, up 4% month on month; The average transaction price of 182mm monocrystalline silicon wafer was 6.15 yuan / wafer, up 5.1% month on month; The average transaction price of 210mm monocrystalline silicon wafer was 8.1 yuan / wafer, up 5.2% month on month. This week, the price of silicon wafer basically formed a general upward trend of various specifications. The relationship between supply and demand of silicon wafer is mismatched again, and the price is expected to maintain an upward trend in the short term. Battery: this week, the average transaction price of 166mm battery chips in China was 1.08 yuan / W, up 2.9% month on month; This week, the average transaction price of 182mm battery chips in China was 1.1 yuan / W, up 1.9% month on month; This week, the average transaction price of 210mm battery chips in China was 1.06 yuan / W, up 2.4% month on month. Battery prices rose slightly this week. The purchasing power of the component end has begun to weaken, and it is expected that the power of battery price increase before the Spring Festival is limited. Components: the average transaction prices of 166mm, 182mm and 210mm components in China this week were 1.85 yuan / W, 1.88 yuan / W and 1.88 yuan / W respectively, the same as last week. The component price is stable this week, and the execution price in January is mainly based on the delivery of early orders. The upstream of the supply chain began to raise prices. However, considering the demand and terminal acceptance at the component end, the price has not been significantly adjusted, and the component price is expected to remain stable from January to February.
Market performance last week: the power equipment sector increased by - 2.90%, ranking 21st
Last week's market review: the power equipment sector rose by - 2.90% (up 2.13% last week), ranking 21st (a total of 28 primary sub industries), compared with the Shanghai Composite Index by - 2.93 percentage points and the Shanghai and Shenzhen 300 index by - 4.01 percentage points. Among the constituent stocks of the industry (Shenwan power equipment) last week, the top five weekly gainers and losers were Wanli shares (+ 20.99%), Dalian electric porcelain (+ 12.19%), central control technology (+ 10.79%), Bafang Electric( Suzhou) Co.Ltd(603489) (+ 9.87%) and Zhejiang Founder Motor Co.Ltd(002196) (+ 7.04%). The last five weekly gainers and losers were Hangzhou Kelin Electric Co.Ltd(688611) (- 14.69%), Jolywood (Suzhou) Sunwatt Co.Ltd(300393) (- 15.28%) and Zhejiang Sunflower Great Health Limited Liability Company(300111) (- 17.69%) Jiangsu Luokai Mechanical & Electrical Co.Ltd (603829) (- 18.00%) and Sunway Co.Ltd(603333) (- 33.50%).
Risk tips
Risk of sharp price reduction of products, sharp rise in the price of raw materials, lower than expected downstream demand, risk of intensified industry competition, systemic risk of the market, performance failure of recommended companies, etc.
