TYN(SZ:000591) Goldman Sachs·2025-06-16 03:16Investment Rating - The report assigns a "Buy" rating to LONGi Green Energy Technology Co. and a "Sell" rating to Flat Glass Group (A), Flat Glass Group (H), Tongwei, and Xinyi Solar Holdings [14]. Core Insights - Overall sentiment in the solar industry has turned more negative compared to the previous year, with lower expectations for supply-side policy support [1][4]. - Demand for solar installations is expected to face significant downside risks, with projections indicating a 55% year-over-year decline in installations from June to December 2025 and a 30% decline in 2026 [2]. - Tier 1 companies are maintaining optimistic price expectations, which may not align with the deteriorating internal rate of return (IRR) for solar farms in the current pricing environment [3][5]. - Leading module manufacturers are shifting focus towards integrated "Solar+BESS" solutions to enhance customer returns under new policy conditions [7]. - The report anticipates that 17% of end-2024 capacity will exit the market during 2025-2026 due to cash burn pressures and market access constraints [8]. Summary by Sections Industry Sentiment - The 2025 SNEC event in Shanghai reflected a smaller scale with fewer exhibitors and a more negative overall sentiment compared to 2024, with a notable increase in visitors from India and Central Asia [1][4]. Demand Projections - Industry experts predict a significant decline in solar installations, with expectations of a 55% year-over-year drop in the latter half of 2025 and a 30% decline in 2026, contrasting with more optimistic consensus estimates [2]. Pricing and Capacity - Tier 1 companies are guiding to maintain current solar prices, which may be overly optimistic given the current market conditions affecting solar farm IRR [3][5]. - Some companies have begun offering Topcon Modules at prices below Rmb 0.6/W, indicating a potential shift in pricing dynamics [5]. Competitive Landscape - Competition is intensifying in the high-efficiency module segment, with leading companies mass-producing higher wattage modules to compete effectively [6]. - The report highlights that leading players are actively exploring integrated service offerings combining solar and battery energy storage systems (BESS) [7]. Market Dynamics - The report suggests that the combination of cash burn pressures and market access constraints will lead to a significant exit of capacity from the market [8].