Longi(SH:601012) HTSC·2025-11-03 09:18Investment Rating - The investment rating for the company is "Buy" with a target price of RMB 24.41 [7]. Core Views - The company's revenue for the first nine months of 2025 was RMB 50.915 billion, a year-on-year decrease of 13.10%, while the net profit attributable to the parent company was a loss of RMB 3.403 billion, improving by RMB 3.101 billion year-on-year [1]. - The company is expected to benefit from the recovery of silicon prices and the increase in BC technology shipments, which are anticipated to drive profitability improvements [1][2]. - The company maintains a strong position in the silicon wafer market and is expected to generate excess profits from BC components [1]. Summary by Sections Silicon Wafer Business - In the first nine months of 2025, the company achieved external sales of 38.15 GW of silicon wafers, with 13.4 GW sold in the third quarter, remaining stable quarter-on-quarter [2]. - The price of N-type G12R silicon wafers increased by 36% from the end of June to the end of September 2025, contributing to improved profitability in the silicon wafer segment [2]. Battery Components - The company sold 63.43 GW of battery components in the first nine months of 2025, with 21.58 GW sold in the third quarter, showing a slight decline due to high base effects from the previous quarter [3]. - The BC components achieved external sales of 14.48 GW in the first nine months, with 5.8 GW in the third quarter, reflecting a significant increase quarter-on-quarter [3]. - The HIBC product line has a price premium of 50%-100% in the European distributed market, which helps mitigate cost pressures from upstream price increases [3]. Cash Flow and Financial Position - The company has improved its operating cash flow, with a net inflow of RMB 2.303 billion in the third quarter of 2025, representing a year-on-year increase of 217.86% [4]. - As of the end of the third quarter, the company had cash reserves of RMB 51.366 billion and a debt-to-asset ratio of 62.43%, indicating strong financial resilience [4]. Profit Forecast and Valuation - The company’s net profit forecasts for 2025-2027 are adjusted to -RMB 5.106 billion, RMB 6.234 billion, and RMB 7.074 billion, respectively [5][13]. - The target price of RMB 24.41 is based on a 29.76x PE ratio for 2026, reflecting an increase in comparable company valuations [5][15].