Jinko Solar(SH:688223) Sou Hu Cai Jing·2025-07-29 03:25Core Viewpoint - The "anti-involution" movement in the photovoltaic industry has been elevated to a high level since early July, with initial effects seen in the price transmission along the supply chain, starting from silicon materials [2][3]. Industry Overview - Silicon materials are at the top of the photovoltaic supply chain, leading to price increases in silicon wafers, which then transmit to the midstream solar cell segment. However, the component price feedback is weak, with downstream investors still demanding low prices, creating uncertainty in further price transmission [2][3]. - According to Zhongjin Securities, companies purchasing silicon materials are primarily buying in small batches, with many still in a wait-and-see mode, indicating a lack of large-scale transactions [2]. Challenges in the Supply Chain - The most challenging segments in the supply chain are silicon wafers, solar cells, and components, with new production capacities still being introduced in some areas. The component sector faces difficulties due to the high number of participating manufacturers, requiring a market-driven approach to clear excess capacity, which will take time [3][6]. - A significant reduction in production capacity is necessary, with at least one-third needing to be cleared to address the overcapacity issue effectively [8]. Market Dynamics - The global demand for photovoltaic installations is projected to reach 530 GW in 2024 and 570-630 GW in 2025, while supply capacities for silicon materials, silicon wafers, solar cells, and components are expected to be 339.4 million tons, 1394.9 GW, 1426.7 GW, and 1388.9 GW respectively in 2024 [5][6]. - The price transmission from upstream to downstream is essential; without it, the efforts to combat "involution" will not yield results. A lack of downstream demand will lead to a stalemate, creating a "cold" situation at both ends of the supply chain [6][7]. Product Development and Strategy - The company emphasizes the need for high-performance products to regain pricing power and enhance customer value. Their Neo 3.0 component boasts a 27% battery efficiency and 670W front power, aiming to provide better investment value and quicker cost recovery for customers [7]. - The market will likely see a shift towards high-performance, reasonably priced competitive products as a means to clear excess capacity, driven by policy intervention and market selection [9]. Future Outlook - The industry is expected to face more challenges ahead, described as the "darkest hour before dawn," with the success of the "anti-involution" efforts hinging on the determination to restrict new production capacities and the consensus among downstream customers [8][10].