Tongwei (600438): double leader in the field of cell and silicon materials to expand production

Tongwei (600438): double leader in the field of cell and silicon materials to expand production
Event: Tongwei Co., Ltd. announced the development plan of high-purity crystalline silicon and solar cell business from 2020 to 2023, and announced the investment and construction of 30GW high-efficiency solar cells and supporting projects. Large-scale expansion to create an absolute leader in the field of battery cells and silicon materials: 1 1) According to the plan, from 2020-2023, the cumulative production capacity of high-purity crystalline silicon will reach 8/11, respectively.5-15 / 15-22 / 22-29, single crystal materials account for more than 85%, N-type materials account for 40% -80%, production costs 3-4 million / ton, cash costs 2-3 millionYuan / ton, the current production cost is expected to further decline; battery capacity will reach 30-40 / 40-60 / 60-80 / 80-100GW respectively in 2020-2023, focusing on new product technologies such as Perc +, Topcon, HJT, etc.And compatible with all series of 210 and below, Perc non-silicon cost 0.Below 18 yuan / w, the current estimate is 0.23 yuan / w dropped further significantly.According to the 10% compound annual growth rate of global new photovoltaic installations, it is estimated that by 2023, the annual global new photovoltaic installations will reach 200GW, and the proportion of Tongwei silicon materials and batteries in cities will reach 30% -50%, becoming an industry.faucet.2 2) The company also announced that it will invest about 20 billion US dollars to build an annual output of 30 GW high-efficiency solar cells and supporting projects. The project will be implemented in four phases, of which the first and second 苏州夜网论坛 phases are planned to invest 4 billion yuan each and build 7 respectively.5GW, a total of 15GW high-efficiency solar cell projects (Perc, Perc +, Topcon); Phases 3 and 4 plan to invest 6 billion yuan each, and build 7 respectively.5GW, a total of 15GW high-efficiency solar cells and supporting projects (temporary to HJT). The overall supply and demand is tight, and it is expected that the volume and price will rise for the time being: the existing company has continuous old production capacity2, and the proportion of single crystal materials is further increased to 90%.In addition, Leshan, Baotou each 3.5 The largest output achieved by emerging manufacturing, mainly due to consumption indicators exceeding design expectations, the proportion of single crystal materials increased to 85%, and production costs replaced within 4 杭州桑拿网 million / ton (Leshan 4 million / ton, Baotou 3).5 million / ton), leading costs.Affected by the ramp-up of production capacity in 2019, the expected sales volume is expected to be around 6, and in 2020 we expect the sales volume to reach 8.5-9 every year, the annual growth rate exceeds 40%.In addition, according to foreign media BusinessKorea, OCI is about to close its Gunsan plant in South Korea5.2 The production of formaldehyde photovoltaic silicon materials is suspended and transition to electronic grade silicon materials is expected to affect 10% of global supply.In the meantime, this year is a big year for monocrystalline silicon wafer expansion. The production capacity is expected to increase from about 100GW at the end of 2019 to 170-180GW at the end of 2020. However, gradually increasing production capacity is limited and overall supply and demand are tight.In a tight situation, the price of extension materials is expected to usher in a price increase of 5% -10%. The profitability of monocrystalline PERC cells has improved: The demand brought by capacity release in the third quarter of 2019 is weak. The price of monocrystalline PERC cells has been adjusted to a certain extent. At present, the average cell price is 0.97-0.98 yuan / W, single W profit replaced 5-6 cents, the profit level is at a historical low.The overall non-silicon cost of the company’s battery chip is zero.23 yuan / w, will further replace 0 in 2020.At around 2 yuan / w, and the price of overlapping silicon wafers is reduced at the same time, it is expected that the single W profit of single crystal perc battery cells will be repaired to more than 8 cents in 2020.In addition, in the first half of this year, the overall capacity of Chengdu Phase IV and Meishan Phase I will reach 23-24GW, and according to the expansion plan, it will reach 30GW at the end of this year, which can be expanded up to 20GW, thereby increasing 66.7%, single crystal PERC cell connection will usher in volume and profit. Investment advice: We expect the company’s revenue growth from 2019 to 2021 to be 30%, 26%, and 25%, and its net profit growth to be 43%, 46%, and 31%.The 6-month target price is 19.45 yuan. Risk warning: photovoltaic installation is less than expected, replacement, and the price of cells has fallen sharply, etc.