GCL TECH(HK:03800) GUOTAI HAITONG SECURITIES·2025-10-23 10:31Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 1.59 HKD based on a 1.2x PB for 2026 [10][19]. Core Insights - In Q3 2025, the company's photovoltaic materials business turned profitable, driven by a reduction in internal competition, positioning leading companies to navigate the cycle effectively [2][10]. - The average selling price of granular silicon increased to 42.12 RMB/kg in Q3 2025, with expectations for further price stability and growth in Q4 2025 and 2026 [10]. - The company plans to utilize funds from a recent subscription announcement for mergers and acquisitions to enhance its granular silicon production capacity, which is expected to balance supply and demand in the industry [10]. Financial Summary - Total revenue for 2023 is projected at 33.7 billion RMB, with a decline of 6.2% year-on-year. Revenue is expected to drop significantly in 2024 to 15.1 billion RMB, followed by a gradual recovery [4]. - Gross profit is forecasted to be 11.69 billion RMB in 2023, turning negative in 2024 with a loss of 2.51 billion RMB, before recovering to 4.1 billion RMB in 2026 [4]. - Net profit is expected to be 2.51 billion RMB in 2023, declining to a loss of 4.75 billion RMB in 2024, with a return to profitability projected in 2026 with a net profit of 1.32 billion RMB [4]. Market Data - The company's current market capitalization is approximately 38.44 billion HKD, with a share price range over the past 52 weeks between 0.73 and 1.72 HKD [7]. - The average production cash cost for granular silicon in Q3 2025 was 24.16 RMB/kg, showing a decrease of 1.15 RMB/kg from the previous quarter [10].