Annual Prospect of Photovoltaic Industry: Silicon Price becomes an important variable A new round of technology cycle is ready to start

This year is the first year of carbon neutralization in China, and the solar energy industry, which is regarded as one of the cleanest energy sources, has ushered in opportunities for development. Photovoltaic terminal demand continues to break out, driving the industrial chain to expand production tide, multi-link ushered in a simultaneous rise in volume and price, the industry as a whole has entered the boom stage.

Looking back at the trend of the photovoltaic industry over the past year, after a brief adjustment at the beginning of the year, the sector index has risen all the way to 5988.16, up nearly 70% from the beginning of the year; and in the fourth quarter, the division between the sectors intensified and the market was bumpy.

Towards the end of the year, the upstream wafer side took the lead in price reduction. November 30, December 16, leading Longji shares issued two price reduction letters, silicon wafer products accumulated price reduction of 12-15%, causing the photovoltaic sector to dive, December 17-20 only two trading days, the sector index fell nearly 8%.

A reporter from the Financial Associated Press learned from silicon companies that the price reduction of silicon wafers will lead to silicon to a certain extent, but the details will not be known until the second half of next year.

So, after the ups and downs of 2021, what are the investment opportunities for the photovoltaic industry in 2022? What is the agency's outlook for this?

The installed demand is expected to boost the prosperity of the photovoltaic industry and be favored.

In the overall research and judgment of the industry, a number of institutions believe that the photovoltaic industry will remain prosperous in 2022.

Cui Yifan of Citic Securities believes that the overall price of silicon, including silicon wafers, is on the high side this year, affecting the overall willingness to install the machine. If the prices of components, wafers, silicon materials and other links return to a very cost-effective level, coupled with the strong willingness to install downstream terminals, the installation situation is likely to reach a more optimistic level next year.

Great Wall Securities also made a booming analysis, analysts predict that the global photovoltaic market is expected to usher in a big year of demand driven by downward raw material prices and policy support in 2022. Next year, the global photovoltaic installed capacity is 225GW, and the domestic photovoltaic installed 110GW.

In the long run, renewable energy will usher in a period of rapid development in the next five years, and photovoltaic is expected to play a leading role. According to IEA data, the average new installed capacity of renewable energy in the world from 2021 to 2026 is 305GW, 380GW, an increase of nearly 58% over the past five years, of which photovoltaic capacity will account for nearly 60%.

In terms of valuation, Guojin Securities believes that under the performance growth driven by the growth of industry scale and concentration, most of the core targets are relatively low in the growth industry. In 2022, with the realization of enterprise performance growth and the gradual verification of the leading advantage, the plate still has a large probability of overall valuation opportunities, and the leader is expected to gradually enjoy the valuation premium.

Technology-driven long-term growth of photovoltaic enterprises

From the past history, the important factor affecting the growth of photovoltaic enterprises is technology iteration. Therefore, for all aspects of the industrial chain, the direction of technological progress is still worth tracking.

Shanghai Securities pointed out that the current photovoltaic industry is brewing a new round of technology cycle. On the silicon side, granular silicon is gradually formed using the improved Siemens method and in commercial application; CZZ technology has become a new direction in crystal pulling; on the battery chip, the conversion efficiency of PERC technology is close to the bottleneck, and N-type technology, which is not represented by HJT technology, is realizing overtaking.

Analysts suggest that around the layout of granular silicon, CCZ, slicing, N-type battery, MLPE, intelligent algorithm tracking bracket, and optimistic about technological progress, industry mainline, downstream application three major directions.

The link of auxiliary materials is more deterministic.

Affected by the tight supply of the main photovoltaic industry in 2021, the photovoltaic industry in the middle and lower reaches is under pressure. with the release of production capacity brought about by the price reduction in the upstream, photovoltaic modules and photovoltaic application products in the middle and lower reaches of 2022 are expected to benefit the most.

Among them, photovoltaic auxiliary materials have attracted much attention, and the major research newspapers have also raised their expectations for this link.

Guokai Securities believes that photovoltaic accessories have stronger certainty than photovoltaic manufacturing, and the demand for replacement during the operation of superimposed photovoltaic power stations continues to grow, and it is recommended to focus on the inverter industry in 2022; on the other hand, photovoltaic glass, photovoltaic film and other component enterprises are also worth paying attention to.

Guojin Securities also mentioned the deterministic benefit volume of inverter and auxiliary materials: 2022 IGBT supply continues to be tight, inverter head enterprise supply chain advantage is maintained, energy storage second curve volume; film 2022H2 profit has upward elasticity; glass duopoly pattern is clear, overall supply and demand is loose, large-size continuation to enjoy premium; tracking bracket 2022 overall marginal improvement of the external environment, volume / profit repair flexibility.

In addition, from the investment path of the industry, Guojin Securities proposes to lay out around two main lines:

1 strong performance companies, such as silicon materials in the bottleneck of the supply chain, inverters whose profit margins are expected to be maintained, core accessories and their upstream raw materials, tracking brackets, etc., the specific targets are Longji shares, Jing O Technology, Gudway, Wemai shares, Trina Solar.

(2) the trend of the medium-and long-term pattern is improved, and it is expected to benefit from the excess growth brought about by technological changes: the leading integrated component leader in the layout of new technology, advanced battery / module equipment manufacturers, including Jingke Energy, Ates and so on.