GCL TECH(HK:03800) Ge Long Hui·2025-09-05 20:21Core Viewpoint - GCL-Poly is a leading global producer of granular silicon with significant cost advantages, recently recognized for its green and low-carbon innovations. The company faced short-term performance pressure due to supply-demand mismatches in the industry, resulting in a revenue decline of 35.3% year-on-year to 5.73 billion yuan and a net loss of 1.78 billion yuan, an increase of 20.0% year-on-year [1]. Group 1: Company Performance - In H1 2025, GCL-Poly's cash cost for granular silicon was 26.22 yuan/kg, maintaining industry leadership, with a Q2 cost of 25.31 yuan/kg, a decrease of 6.5% quarter-on-quarter [1]. - The company achieved a market share of 24.3% in H1 2025, an increase of 7.2 percentage points from H2 2024, with the top five customers accounting for 71% of shipments [1]. - The average transaction price for N-type granular silicon increased significantly to 48.0 yuan/kg, up 43.3% since early July 2025, indicating a potential return to profitability in August-September [1]. Group 2: Technological Advancements - GCL-Poly's GW-level perovskite production line commenced operations in June 2025, marking a significant step towards commercial-scale production, with a C-round financing of nearly 200 million yuan completed in July [2]. - The company achieved a single-junction module efficiency of 19.04% and a tandem module efficiency of 26.36%, with plans to complete the first product by November 2025 and projected shipments of 100 MW, GW, and 3-5 GW in the following years [2]. Group 3: Industry Trends - The Chinese government is actively promoting the "anti-involution" initiative in the photovoltaic sector, with multiple ministries holding meetings to drive this agenda, which is expected to boost downstream demand and support price transmission in the photovoltaic industry chain [2]. - The Ministry of Industry and Information Technology and the State Administration for Market Regulation issued a plan to address low-price competition in the photovoltaic sector, which is anticipated to facilitate orderly adjustments in industry scale and promote supply-side reforms [2]. Group 4: Profit Forecast and Valuation - Due to a decline in demand following Q2's rush for installations, GCL-Poly has adjusted its sales assumptions for silicon materials and wafers, projecting net profits of -2.30 billion, 1.28 billion, and 2.14 billion yuan for 2025-2027 [3]. - The company is expected to return to normal profitability by 2026, with a target price of 2.22 HKD based on a 45x PE ratio for 2026, reflecting the anticipated recovery in industry pricing driven by the "anti-involution" measures [3].