Changzhou Fusion New Material (SH:688503) Huachuang Securities·2024-04-11 16:00Investment Rating - The report assigns a positive investment rating to the company, indicating strong growth potential in the photovoltaic silver paste market [4][10]. Core Insights - The company is positioned as a leading player in the photovoltaic silver paste industry, benefiting from the rapid adoption of N-type batteries, which are expected to drive significant growth in silver paste demand and profitability [7][52]. - The company has successfully completed its domestic production capacity expansion, with plans for further international projects, solidifying its market leadership [88][89]. - The report highlights the increasing market concentration in the silver paste industry, with the top three domestic companies holding approximately 75-80% of the global market share [84]. Financial Performance - Total revenue for 2023 is projected at 10,290 million yuan, with a year-on-year growth of 58.2%. Forecasts for 2024, 2025, and 2026 are 16,178 million yuan, 20,184 million yuan, and 23,474 million yuan, respectively [2]. - The net profit attributable to shareholders for 2023 is expected to be 442 million yuan, reflecting a 13.0% year-on-year increase. Projections for the following years are 692 million yuan in 2024, 819 million yuan in 2025, and 941 million yuan in 2026 [2]. - Earnings per share (EPS) are forecasted to rise from 2.67 yuan in 2023 to 5.68 yuan by 2026, indicating strong profitability growth [2]. Market Dynamics - The N-type battery technology is rapidly penetrating the market, with expectations that its production will surpass PERC batteries by 2024, leading to increased silver paste consumption [30][61]. - The report anticipates that the total demand for photovoltaic silver paste will reach 7,501 tons in 2024, a 16% increase year-on-year, with the market space for silver paste projected to grow to 438 billion yuan, reflecting a 22% increase [61][74]. - The processing fees for N-type silver paste are significantly higher than those for P-type, which is expected to enhance the profitability of silver paste manufacturers [64][76]. Competitive Landscape - The company has established a strong technological foundation with 416 patents, including 375 invention patents, which supports its competitive edge in the silver paste market [89][90]. - The report notes that the silver paste market is highly concentrated, with the top three companies, including the report's subject company, commanding a significant share of the market [84][87]. Production Capacity and Expansion - The company has successfully completed its first phase of a 3,000-ton silver paste production project in Changzhou and is expanding its production capacity internationally, including a 600-ton project in Thailand and a new facility in Yibin [88][89]. - By 2024, the company is expected to achieve a total production capacity exceeding 4,000 tons to meet the growing demand in the industry [88].