Changzhou Fusion New Material (SH:688503) Minsheng Securities·2024-09-17 04:00Investment Rating - The report gives a "Buy" rating for the company, indicating a positive outlook for its future performance [3]. Core Views - The company is a leading player in the photovoltaic silver paste market, benefiting from the acceleration of N-type battery iterations and upstream cost reduction strategies [1][4]. - The company achieved significant revenue growth, with a 61.79% year-on-year increase in revenue for the first half of 2024, reaching 6.765 billion yuan, and a net profit of 299 million yuan, up 11.08% year-on-year [1][9]. - The company is expected to maintain strong growth in revenue and net profit over the next few years, with projected revenues of 16.25 billion yuan, 19.05 billion yuan, and 22.32 billion yuan for 2024, 2025, and 2026, respectively [1][2]. Summary by Sections Company Overview - The company is recognized as the global leader in photovoltaic silver paste, with a market share of 34.40% in the global photovoltaic silver paste market as of 2023 [1][9]. - The company has a strong historical growth trajectory, with a compound annual growth rate (CAGR) of 84.19% in revenue from 2019 to 2023 [9]. N-Type Battery Iteration - The demand for silver paste is expected to increase due to the higher silver consumption in N-type batteries, with silver consumption per cell for N-type TOPCon batteries approximately 109 mg, significantly higher than the 59 mg for P-type batteries [1][19]. - The introduction of LECO technology is anticipated to enhance the premium on silver paste processing fees, as it requires specialized low-erosion silver paste [1][22]. Product and Supply Chain Advantages - The company has a comprehensive product line that covers various technological routes, including PERC, TOPCon, HJT, and X-BC, ensuring it meets diverse market needs [1][26]. - The company is expanding its upstream supply chain by investing in silver powder and glass powder production, which is expected to enhance profitability and ensure stable supply [1][33]. Customer Base and Market Position - The company has established strong customer relationships, with high barriers to entry for new competitors due to rigorous certification processes required by battery manufacturers [1][35]. - The company’s silver paste sales volume reached 2,002.96 tons in 2023, marking a 46% increase from the previous year, solidifying its leading position in the market [1][27].