Summary of the Conference Call on China's Photovoltaic Industry Industry Overview - The report focuses on the photovoltaic (PV) industry in China, tracking monthly supply and demand dynamics, inventory levels, and cash gross profit margins and EBITDA profit margin trends for covered companies [1][2]. Key Points Pricing and Valuation - As of October, the market pricing for 2026 is projected at RMB 58/kg for polysilicon, RMB 1.8/piece for wafers, RMB 0.66/W for modules, and RMB 13/m² for PV glass. The forecasted prices are significantly lower at RMB 42/kg, RMB 1.3/piece, RMB 0.67/W, and RMB 10/m² respectively [2][12]. - The average stock price of covered companies faces a potential downside risk of 34% based on current valuations [2]. Industry Dynamics - The industry is experiencing "anti-involution" measures, with new regulations stating that pricing cannot fall below production costs, which may only slightly improve the pricing outlook for polysilicon compared to the lows seen in June [2]. - Downstream companies are expected to reduce prices to expand market share amid weak demand, despite the need to cut costs [2]. Supply and Inventory Trends - As of October, polysilicon inventory increased by 7% month-over-month to 275 GW, with approximately 150 GW at polysilicon plants, 110 GW at wafer plants, and 15 GW in futures contracts [3]. - PV glass manufacturers saw a significant increase in inventory days, rising 63% to 25 days (equivalent to 40 GW) due to sluggish shipment volumes [3]. - Production cuts are progressing slowly, with a projected 6% decrease in monthly polysilicon output for November and December due to seasonal price peaks in the Midwest [3]. Export and Demand - Exports of battery cells and modules decreased by 10% and 4% month-over-month to 11 GW and 28 GW respectively, primarily due to the end of peak demand seasons in overseas markets [3]. - The global demand for modules in September decreased by 6% year-over-year to 43 GW, although cumulative demand for the first nine months of 2025 increased by 30% to 525 GW [14][19]. Profit Margins - The cash profit margins for upstream sectors remained stable, while downstream margins further declined [5][6]. - The cash gross profit margin for Tier 1 polysilicon is reported at 37%, while the margins for cells and modules are negative, indicating significant pressure on profitability [6]. Additional Insights - The report highlights the potential for further increases in silver prices, which could impact downstream pricing acceptance due to its significant share (30%-40%) of non-silicon processing costs [3]. - The anticipated increase in production capacity for PV glass may exacerbate inventory issues if demand does not recover [3]. Conclusion - The Chinese photovoltaic industry is currently facing challenges with pricing, inventory management, and profitability. The outlook remains cautious, with potential risks to investment returns highlighted by the significant downside in stock valuations and the need for strategic pricing adjustments in response to market conditions [2][3][5].

Core Viewpoint - UBS reports that Fuyao Glass (06865.HK) experienced a 51% year-on-year decline in net profit for the first three quarters, amounting to 638 million RMB, but saw a 1.43 times quarter-on-quarter increase in net profit for the third quarter, reaching 376 million RMB, exceeding market expectations [1] Group 1: Financial Performance - The strong performance is attributed to inventory reduction leading to increased sales, price hikes since September, decreased soda ash costs, and improved operational efficiency [1] - UBS has raised its earnings per share forecast for the company by 13%, reflecting adjustments in sales and profit margin expectations, as well as a recovery in demand and prices since August, along with effective cost reductions [1] Group 2: Stock Ratings and Price Targets - The target price for Fuyao Glass has been increased from 13.4 HKD to 14.7 HKD, maintaining a "Buy" rating [1] - As of October 30, 2025, Fuyao Glass closed at 12.48 HKD, up 2.72%, with a trading volume of 11.5796 million shares and a turnover of 145 million HKD [1] - In the past 90 days, two investment banks have issued "Buy" ratings for the stock, with an average target price of 12.58 HKD [1] Group 3: Market Position and Key Metrics - Fuyao Glass has a market capitalization of 53.67 billion HKD, ranking third in the glass manufacturing industry [1] - Key performance indicators show that Fuyao Glass has a return on equity (ROE) of -0.94%, compared to the industry average of -37.96%, and a net profit margin of 3.44%, outperforming the industry average of -1.89% [2] - The company ranks third in terms of operating revenue at 157.24 billion HKD, while the industry average is 92.83 billion HKD [2]

Group 1 - The core viewpoint of the report is that the company has raised its profit forecast for 2025 but slightly lowered the forecasts for 2026 and 2027, maintaining a valuation benchmark of 1.1 times the 2026 price-to-book ratio, with a target price increase from HKD 11.7 to HKD 12.05 [1] - The company expects a significant weakening in performance over the next two quarters, and after a recent rebound in stock price, the valuation attractiveness is limited, leading to a downgrade in rating from "Buy" to "Neutral" [1] - In Q3, the company's revenue and profit reached RMB 4.73 billion and RMB 376 million respectively, representing a year-on-year increase of 21% and a turnaround from loss, with a quarter-on-quarter increase of 29% and 143% [1] Group 2 - The report indicates that the production capacity of photovoltaic glass in mainland China decreased from 100,000 tons at the end of May to 89,000 tons at the end of July, and the industry inventory days dropped from 36 days in mid-July to a minimum of 15 days by late September [2] - The price of 2.0mm glass per square meter increased significantly from RMB 11 in August to RMB 13 in September, outperforming expectations [2] - However, as component customers reduce purchases due to depleting inventory and production cuts, the industry inventory days have rebounded to 21 days since October, and glass prices are expected to decline again starting in November [2]

Core Viewpoint - UBS reports that Fuyao Glass (06865) exceeded quarterly profit expectations, leading to an increase in the target price to HKD 14.7 [1] Financial Performance - For the first three quarters, Fuyao Glass's net profit decreased by 51% year-on-year to RMB 638 million [1] - In the third quarter, net profit increased 1.43 times quarter-on-quarter to RMB 376 million, surpassing market expectations [1] Factors Influencing Performance - The strong performance is attributed to inventory reduction leading to increased sales, price hikes since September, decreased soda ash costs, and improved operational efficiency [1] - UBS has raised its earnings per share forecast for the company by 13%, reflecting adjustments in sales volume and profit margin expectations, as well as a recovery in demand and prices since August and effective cost reductions [1] Target Price Adjustment - UBS has revised the target price for Fuyao Glass from HKD 13.4 to HKD 14.7, maintaining a "Buy" rating [1]

交银国际表示，下游囤货推动福莱特玻璃第三季业绩大增，公司季内收入和盈利分别为47.3亿和3.76亿 元人民币(下同)，同比增长21%和扭亏，按季增长29%和143%。由于组件客户对玻璃价格触底反弹预期 强烈，第三季大量囤货，致公司在产量环比下降的情况下销量大增，期末存货环比锐减38%并创四年新 低。第三季光伏玻璃价格先跌后涨，均价环比下跌，但第二季末存货减值后的低价库存在第三季销售， 纯碱价格下跌也导致成本下降，推动毛利率环比仍提高0.1个百分点至16.8%，同时由于产品价格上涨， 冲回存货减值0.82亿元。 报告指，内地光伏玻璃在产产能由5月底的10.0万吨降至7月底的8.9万吨，在减产和下游囤货的共同推动 下，行业库存天数由7月中旬的36天快速降至9月下旬最低的15天，推动2.0毫米玻璃每平米价格由8月的 11元大幅回升至9月的13元并维持至今，走势强于该行预期。但随着组件客户消耗囤积的玻璃库存而减 少采购以及组件减产，10月以来行业库存天数快速反弹，目前已达21天，预计后续库存仍将持续上升， 11月起玻璃价格或将重回下跌趋势。虽然9月涨价后至今新投产产能较少，但行业目前已建成产能众 多，仅两家一线企业的 ...

Core Viewpoint - Huatai Securities reports that Flat Glass's third-quarter net profit exceeded expectations due to the recovery of photovoltaic glass prices, leading to a rebound in gross margin, along with asset impairment reversals [1] Group 1: Financial Performance - Flat Glass's net profit for the third quarter surpassed expectations, primarily driven by the recovery in photovoltaic glass prices [1] - The company's gross margin improved as a result of the price recovery and asset impairment reversals [1] Group 2: Inventory and Sales Outlook - As of the end of the third quarter, Flat Glass's inventory decreased by 38.4% quarter-on-quarter, indicating a potential easing of inventory pressure [1] - The company is expected to see sales growth due to improved supply and demand dynamics in the photovoltaic glass industry [1] Group 3: Price Stability and Profitability - The report anticipates that photovoltaic glass prices will remain relatively stable in the fourth quarter amid industry consolidation [1] - The company's profitability is expected to continue improving, with earnings estimates for 2025 to 2027 projected at 1.04 billion, 1.8 billion, and 2.28 billion respectively [1] Group 4: Investment Rating - Huatai Securities maintains an "Overweight" rating for Flat Glass, raising the target price from HKD 12.79 to HKD 13.54 [1]

该行上调福莱特玻璃2025年盈利预测，但小幅下调2026至27年预测，维持1.1倍2026年市账率的估值基 准，目标价由11.7港元上调至12.05港元。该行预计公司未来两个季度业绩将明显转弱，近期股价反弹后 估值吸引力有限，评级由"买入"降至"中性"。 交银国际发表报告指，下游囤货推动福莱特玻璃第三季业绩大增，收入和盈利分别为47.3亿和3.76亿 元，按年增长21%和扭亏，按季增长29%和143%。由于组件客户对玻璃价格触底反弹预期强烈，第三季 大量囤货，导致公司在产量环比下降的情况下销量大增，期末存货环比锐减38%并创四年新低。 ...

Core Points - The Shanghai Composite Index closed at 4009.81 points, slightly down by 0.16%, with a total trading volume of 202.97 billion yuan [1] - A total of 29 A-shares have surpassed their annual moving average, with notable stocks showing significant deviation rates [1] Summary by Category Stock Performance - The stocks with the highest deviation rates from their annual moving average include: - Huaihe Energy (5.10%) - Longban Media (3.78%) - China Oilfield Services (3.49%) [1] - Other stocks that have just crossed the annual moving average with smaller deviation rates include: - Fulete - China Railway - China National Heavy Duty Truck [1] Trading Data - The trading data for stocks that broke through the annual moving average on October 30 includes: - Huaihe Energy: +5.95% with a turnover rate of 5.94% - Longban Media: +3.99% with a turnover rate of 3.15% - China Oilfield Services: +4.58% with a turnover rate of 1.43% [1] - Additional stocks with notable performance include: - Guangha Tongxin: +7.41% - Runze Technology: +7.35% - BlueFocus Communication: +9.49% [1]

Core Viewpoint - Bank of America Securities upgraded the rating of Fuyao Glass (06865) from "Underperform" to "Neutral" due to better-than-expected net profit of 376 million RMB in Q3, benefiting from a gross margin of 16.8%, significantly higher than the forecast of 8-9% [1] Financial Performance - Fuyao Glass's Q3 net profit reached 376 million RMB, surpassing expectations [1] - The gross margin of 16.8% was notably higher than the previously predicted range of 8-9% [1] Earnings Forecast - The earnings forecast for Fuyao Glass for the fiscal year 2026 was raised by 55% [1] - The target price was increased from 7 HKD to 12.8 HKD, based on a projected price-to-earnings ratio of 15.5 times for fiscal year 2026, aligning with the five-year average [1] Competitive Position - Fuyao Glass demonstrates a significant profit advantage compared to smaller or domestically limited competitors [1] - The company’s gross margin of 16-17% over the past two quarters is expected to establish a new long-term bottom for the company [1] Market Concerns - There are ongoing concerns regarding weak solar demand and a persistent oversupply situation in the market [1] - Following the earnings announcement, Fuyao Glass's stock price increased by 12%, leading to a more reasonable valuation [1]

Core Viewpoint - Bank of America Securities upgraded the rating of Fuyao Glass (601865) from "Underperform" to "Neutral" due to a better-than-expected net profit of 376 million RMB in Q3, benefiting from a gross margin of 16.8%, significantly higher than the forecast of 8-9% [1] Financial Performance - The company’s net profit for Q3 reached 376 million RMB, surpassing expectations [1] - The gross margin of 16.8% was well above the anticipated range of 8-9% [1] - The earnings forecast for Fuyao Glass for the fiscal year 2026 was raised by 55% [1] Valuation and Price Target - The target price for Fuyao Glass was increased from 7 HKD to 12.8 HKD, based on a projected price-to-earnings ratio of 15.5 times for fiscal year 2026, which aligns with the five-year average [1] Competitive Position - Fuyao Glass has a significant profit advantage compared to smaller or domestically focused peers, with a gross margin of 16-17% expected to be the new long-term bottom for the company [1] Market Concerns - There are ongoing concerns regarding weak solar demand and a persistent oversupply situation in the market [1] - Following the earnings announcement, Fuyao Glass's stock price increased by 12%, leading to a more reasonable valuation [1]