TONGWEI CO.,LTD(SH:600438) Soochow Securities·2024-09-06 14:10Investment Rating - The investment rating for Tongwei Co., Ltd. is "Buy" (maintained) [1] Core Views - The report indicates that silicon prices have bottomed out, leading to accelerated industry consolidation, while battery and module production continues to deepen [3][4] - The company's revenue for H1 2024 is reported at 43.8 billion yuan, a year-on-year decrease of 40.9%, with a net profit attributable to shareholders of -3.13 billion yuan, a year-on-year decrease of 123.6% [3] - The report highlights a significant increase in N-type production capacity and leading technological advancements in the industry [4] Financial Performance Summary - H1 2024 revenue was 43.8 billion yuan, down 40.9% year-on-year, with a gross margin of 7.1%, down 27 percentage points [3] - The company sold 22.89 million tons of silicon materials in H1 2024, an increase of 28.8% year-on-year, despite profitability being pressured by falling prices [3] - The company’s battery sales exceeded 35 GW in H1 2024, with N-type accounting for over 60% [4] - Operating expenses increased by 27.4% in H1 2024, with a fee ratio of 10.8%, up 5.8 percentage points year-on-year [4] Production and Capacity Expansion - The company’s N-type production capacity has significantly increased, with TNC production exceeding 80% of its capacity [4] - The report mentions that the company’s 200,000-ton project in Yunnan was successfully put into production in May 2024, and another 200,000-ton project in Baotou is expected to be completed by the end of the year [3][4] Profit Forecast and Valuation - Due to intensified industry competition and declining prices, the profit forecast for the company has been revised downwards, with expected net profits for 2024-2026 at -5 billion, 3.8 billion, and 6.5 billion yuan respectively [4] - The report maintains a "Buy" rating despite the downward revision of profit forecasts [4]