Report Summary Report Title Multi-silicon Monthly Report Report Date November 01, 2025 Industry Investment Rating Not provided Core Viewpoint The multi-silicon market is suppressed by fundamentals above and supported by policies below. Wait for a definite opportunity for range breakthrough [4]. Summary by Directory 1. Multi-silicon Market Review and Outlook - **Market Review**: In October, multi-silicon futures contracts continued to oscillate at high levels. The Ps2511 contract closed at 54,350 yuan/ton, up 5.82% monthly, with a trading volume of 2.321 million lots and an open interest of 2,748 lots. The Ps2601 contract closed at 56,410 yuan/ton, up 5.29% monthly, with a trading volume of 2.392 million lots and an open interest of 142,000 lots, a net increase of 109,000 lots. The spot price of multi-silicon remained stable, with the n-type re-feeding material trading in the range of 49,000 - 55,000 yuan/ton, and the average transaction price at 53,200 yuan/ton [9]. - **Market Outlook**: The spot price range of multi-silicon is 49,000 - 55,000 yuan/ton, and the average transaction price is 53,200 yuan/ton. The price range of the multi-silicon futures 2601 contract is 50,000 - 59,000 yuan/ton. The closing price at the end of October has a premium over the spot price, and the upward resistance is increasing. The endogenous driving force for the improvement of multi-silicon supply and demand is limited. The profit of multi-silicon has been significantly repaired, and the monthly output has continued to exceed expectations. In October, the output of multi-silicon was 137,000 tons, which can meet the terminal demand of 68.50GW. The terminal demand is still in the weak stage after the "rush installation", with the monthly demand expected to be about 10GW, the export demand between 20 - 30GW, and the total demand about 40GW. The policy-driven logic takes precedence over the fundamentals. The support policy is that the selling price of silicon materials should not be lower than the comprehensive production cost of enterprises. The effective support provided by the fundamentals is expected to be between 45,000 - 47,000 yuan/ton. The stimulus policy comes from the "state reserve" rumor in the past two months, which has not been realized and should not be priced. Overall, the unilateral driving force is not strong. It is advisable to bet on a rebound at the lower edge of the range or wait for the policy to be realized for a range breakthrough. Do not chase up or sell down within the range [10][11]. 2. Limited Endogenous Driving Force for the Improvement of the Photovoltaic Industry's Supply and Demand - **Price Stability**: The spot prices in the photovoltaic industry generally remained stable. The spot price of industrial silicon was stable, the multi-silicon spot price was stable with low market activity, the prices of silicon wafers showed no obvious changes, and the prices of downstream batteries and components were relatively stable [13]. - **High Profits and Production Will**: In October, the average production cost of multi-silicon was 41,443 yuan/ton, and the theoretical net profit per ton was as high as 9,157 yuan/ton. The high profits and industry self-discipline may weaken the actual effect of anti-involution production cuts. The production willingness of multi-silicon enterprises was high in October, and the actual production cut was less than expected, with the pressure of supply-demand mismatch remaining [14][15]. - **Production and Demand Situation**: The production of silicon wafers and batteries remained stable, and the pressure of terminal demand had not been significantly transmitted to the upstream. The anti-involution price increase in the industry chain stimulated the production of silicon wafers and batteries to continue to rise. From January to September, the silicon wafer production was 488.70GW, with a cumulative year-on-year decrease of 4.59%. In October, the expected production of silicon wafers was between 58 - 60GW, with little monthly change. From January to September, the battery production was 481.48GW, with a cumulative year-on-year increase of 0.51%. In October, the expected production of batteries was about 55GW, with little monthly change. The terminal demand was still in the weak stage after the "rush installation" in the first half of the year. From January to September 2025, the new photovoltaic installed capacity was 240.27GW, with a cumulative year-on-year increase of 49.35%. However, the installed capacities in June, July, August, and September were 14.36GW, 11.04GW, 7.36GW, and 9.65GW respectively, and the installed capacity in September decreased by 54% year-on-year. In terms of external demand, from January to September 2025, the total export volume of photovoltaic modules was 204.27GW, a year-on-year increase of 4.6%. In September, the export volume of Chinese photovoltaic modules was 25.63GW, a month-on-month decrease of 6.0% and a year-on-year increase of 46.8%. The supply-demand mismatch pressure remained, and the multi-silicon spot market continued to accumulate inventory. As of October 30, the multi-silicon spot inventory was 273,040 tons, a 13.33% increase from the same period last month, a 1.2% increase from the end of June, and a 7.50% increase from the same period last year. The futures inventory was 27,360 tons, a 14.72% increase from the same period last month [15][16][17]. 3. The Macro and Industrial Policies Were in a Vacuum Period in October - **Policy Frequent in September**: In September, the multi-silicon industry policies were frequently issued, fulfilling the policy expectations of anti-"involution" competition set by the high-level since the end of June. On September 4, the Ministry of Industry and Information Technology and the State Administration for Market Regulation issued the "Stable Growth Action Plan for the Electronic Information Manufacturing Industry from 2025 - 2026". On September 16, the article "Deeply Promote the Construction of a Unified National Market" was published in the official media, emphasizing the governance of various chaotic phenomena. On the same day, the Standardization Administration of China solicited opinions on 3 mandatory national standards such as "Energy Consumption Quotas per Unit Product of Silicon Polysilicon and Germanium". After the adjustment of the existing production capacity structure, the effective production capacity of domestic multi-silicon will drop to about 2.4 million tons/year, a decrease of 16.4% compared with the end of 2024 and a 31.4% decrease compared with the installed production capacity [32]. - **Policy Evaluation**: Currently, the total production capacity of the multi-silicon industry is significantly excessive. It is expected that the policy logic is not to clear the photovoltaic production capacity but to promote the healthy and orderly development of the industry through policy guidance and market-based operations, with the overall goal of meeting the "dual carbon" target. The multi-silicon industry needs more policies from the policy side and the industry to get out of the bottom cycle of supply-demand imbalance [33].

Investment Rating - The investment rating for the company is "Buy" and is maintained [7]. Core Views - In the first half of 2025, the company achieved revenue of 21.052 billion yuan, a year-on-year decrease of 4.13%, and a net profit attributable to shareholders of 731 million yuan, down 41.01%. In Q2 2025, revenue was 12.467 billion yuan, a year-on-year increase of 0.85% and a quarter-on-quarter increase of 45.2%. The net profit for Q2 was 684 million yuan, up 3.51% year-on-year and up 1346.82% quarter-on-quarter [2][5]. Summary by Sections Business Performance - In H1 2025, the company shipped 14.8 GW of components, with North America shipments increasing by 15% year-on-year, and the market share in North America rising by 4% quarter-on-quarter. The gross margin was 8.4%, down 5.5 percentage points, primarily due to a decline in solar module prices and a significant increase in tariff costs. In Q2, component shipments were 7.9 GW, with North America accounting for 36% [10]. Energy Storage Business - The energy storage business saw shipments of 3.1 GWh in H1 2025, a year-on-year increase of 19.2%, with a gross margin of 31.4%, up 8.1 percentage points. In Q2, energy storage shipments reached 2.2 GWh, with a quarter-on-quarter growth of over 140% [10]. Financial Indicators - In H1 2025, the company reported asset impairment losses of 610 million yuan, including 330 million yuan for fixed assets and 280 million yuan for inventory. The operating net cash flow was 3.78 billion yuan, a year-on-year increase of over 150%, benefiting from strategic adjustments in the photovoltaic business and strong breakthroughs in the energy storage business [10]. Outlook - For the second half of 2025, the company plans to prioritize profit and optimize shipment schedules to cope with industry fluctuations, expecting Q3 component shipments of 5.0-5.3 GW and total shipments for the year of 25-27 GW. The energy storage business has signed contracts with a total order value of 3 billion USD, supporting future performance growth, with Q3 energy storage shipments expected to be 2.1-2.3 GWh and total shipments for the year of 7-9 GWh [10].

Core Viewpoint - The stock price of Hengdian East Magnetic (002056.SZ) rose by 4.99% to 18.30 CNY per share, reflecting a positive alignment with its fundamental performance as reported in the financial results [1] Financial Performance - For the first half of 2025, the company achieved a revenue of 11.936 billion CNY, representing a year-on-year growth of 24.75%, with a net profit attributable to shareholders of 1.02 billion CNY, up 58.94% [3] - In Q2 2025, the company reported a single-quarter revenue of 6.713 billion CNY, a year-on-year increase of 25.87%, and a net profit of 562 million CNY, which is a significant rise of 94.8% [3] - The company's revenue sources for H1 2025 were primarily from the photovoltaic sector, contributing 8.054 billion CNY (67.5%), followed by magnetic materials at 2.371 billion CNY (19.9%), and lithium battery products at 1.286 billion CNY (10.8%) [3] Business Segments - The photovoltaic segment is the largest revenue contributor, with a shipment of approximately 13.4 GW in H1 2025, reflecting a growth of over 65% year-on-year and a gross margin of about 16.7% [3] - The company has a production capacity of 290,000 tons of magnetic materials, making it the largest in China, and ranks first in the industry for ferrite magnetic material shipments [6] - The photovoltaic segment has an annual production capacity of 23 GW for batteries and 21 GW for solar modules, placing it among the top ten in product shipments [6] Industry Context - The company acknowledges the challenges of overcapacity in the photovoltaic industry, with low average operating rates and operational difficulties, leading to accelerated industry consolidation [4] - The company faces global policy risks, including domestic regulatory measures aimed at curbing disorderly competition and international trade barriers such as tariffs and carbon taxes [5] - The management indicated that the production base in Indonesia is operating at full capacity, contributing positively to the photovoltaic segment's profitability, with expectations for further shipment increases in Q2 [5]

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - Based on fundamental analysis, some commodities are rated as trend bearish, oscillating bearish, oscillating, oscillating bullish, and trend bullish; based on quantitative indicators, some commodities are rated as bearish, oscillating, and bullish [4][7] - The A - share market is on the rise, and the margin trading balance has reached a new high in 10 years. The macro - economic data in July showed a decline, and the government emphasized enhancing the effectiveness of macro - policies [11][15] - Different trading strategies are proposed for various futures products such as stock index futures, treasury bond futures, and commodities in different sectors [15][16] Summary by Directory Macro News - From September 1st, three new conditions for personal pension withdrawal are added. In July, the national general public budget revenue increased by 2.6% year - on - year, and the cumulative increase in the first seven months turned positive [10] - The A - share market is rising, and the margin trading balance has exceeded 2.1 trillion yuan for the first time in 10 years. As of August 19th, over 60% of the disclosed A - share companies in the first half of 2025 achieved year - on - year growth in net profit attributable to the parent [11][12] - The US plans to hold a tri - lateral meeting between the US, Russia, and Ukraine. The US has expanded the steel and aluminum tariff list, and the US new home starts in July increased by 5.2% month - on - month [12][13] Stock Index Futures - The long - term strategy is to go long on dips, and short - term attention should be paid to adjustments. The A - share market was in a narrow - range oscillation on Tuesday, and the three major indices closed down [15] Treasury Bond Futures - The curve steepening strategy can still be held in the medium - term, and short - term participation in the bond market rebound can be considered. The capital market is tight, and the futures market is stronger than the spot market [16][17] Black Commodities - Steel and ore prices are expected to oscillate. The policy tone is mild, and the seasonal demand is weak, but the supply - demand contradiction is not prominent in the medium term [19] - The prices of coking coal and coke may enter a high - level oscillation stage. The supply of coking coal is expected to be tight in the short term, but there is also downward pressure [20][21] - For ferroalloys, it is recommended to hold previous short positions and take profit on dips if there is a sharp decline. The short - term fundamentals have no rebound logic [21] Non - ferrous Metals and New Materials - The social inventory of zinc is increasing, and the zinc price is expected to oscillate downward. The supply of zinc is expected to increase, and the downstream demand is weak [26] - The price of lithium carbonate is expected to oscillate widely in the short term. The supply - demand gap is widening, but the price increase space is limited before new production cuts or restarts [27] - Industrial silicon is expected to oscillate, and polysilicon is expected to oscillate widely. The supply - demand of industrial silicon has improved marginally, and the polysilicon market is affected by policy expectations [28][29] Agricultural Products - For cotton, a bearish view on the long - term is recommended. The downstream demand is weak, and there is an expected increase in production in the future [31][32] - For sugar, the supply is expected to increase, and the price is under pressure. However, attention should be paid to the rebound opportunity during the Mid - Autumn and National Day holidays [33][34] - For eggs, it is recommended to reduce short positions on dips. The supply pressure is high, but the price may rise seasonally in the short term [35][36] - For apples, a light - position positive spread strategy is recommended. The price of early - maturing apples shows a high - quality - high - price trend [36] - For corn, it is recommended to go short on the 01 contract. The market sentiment is bearish, and the supply - demand is under pressure [37] - For red dates, a wait - and - see strategy is recommended. The spot price is stable, and the futures market is oscillating [39] - For live pigs, a cautious bearish operation on near - month contracts is recommended. The supply pressure remains, and the demand improvement is limited [39][40] Energy and Chemicals - For crude oil, it is recommended to go short on rallies. The market is back to weak fundamentals trading, and the supply is expected to exceed demand [42] - For fuel oil, the price will follow the oil price. The market is affected by multiple factors, and the fundamentals are complex [45] - For plastics, the market sentiment is weakening, and the supply pressure is high. A strategy of selling out - of - the - money call options or a slightly bearish allocation is recommended [46] - For rubber, short - term long positions with stop - loss on dips are recommended, and caution is needed when chasing high prices [47] - For methanol, a bearish oscillation strategy is recommended, and short positions can be reduced [48] - For caustic soda, futures long positions can take profit on rallies. The spot market is strong in the short term, but the futures market is skeptical about the long - term high price [49][50] - For asphalt, the price follows the oil price. The fundamentals are stable, and it is in the off - season turning to the peak season [51] - For the polyester industry chain, it is expected to oscillate in a range, and a strategy of going long on PTA processing fees can be considered [52] - For liquefied petroleum gas, the price is likely to fall. The supply is abundant, and the demand is weak in the medium - long term [52] - For pulp, it is recommended to observe the port de - stocking and spot trading improvement. The market is affected by news and sentiment [53] - For urea, it is recommended to take profit on long positions. The spot market is oversupplied in the short term [54]

Report Information - Date: August 19, 2025 [2] Market Performance and Outlook - The main contract price of polysilicon continued to show high-level volatility. The closing price of PS2509 was 52,280 yuan/ton, with a gain of 1.71%. The trading volume was 425,548 lots, and the open interest was 135,517 lots, a net decrease of 3,206 lots [4] - The photovoltaic enterprise symposium has reignited strong policy implementation expectations, but the futures market has already priced in some of these expectations. Further upward movement depends on subsequent policy support. In the second week of August, the average spot price (recycled feedstock) remained stable at 47,500 yuan/ton, providing strong support for the futures price. However, both supply and demand in the fundamentals are increasing, and there is no inventory reduction drive. The Silicon Industry Branch expects the production schedule in September to reach as high as 145,000 tons, and the rebalancing of industry supply and demand still has a long way to go [4] - On the supply side, the polysilicon production schedule in August increased significantly to 125,000 tons, which can roughly meet the downstream cell demand of about 56GW. The monthly production of silicon wafers and cells decreased to around 52GW, and the overall supply-demand pattern remains loose. Overall, the futures and spot prices are supported by policies at the lower end and restricted by supply-demand pressures at the upper end, and are expected to maintain wide-range volatility. Caution should be exercised regarding capital speculation on excessive policy expectations [4] Market News - On August 18, the number of polysilicon warehouse receipts was 5,820 lots, a net increase of 220 lots from the previous trading day [5] - From January to June, the cumulative photovoltaic installed capacity was 212.21GW, a year-on-year increase of 107.07%. In June, the domestic installed capacity was only 14GW [5] - Customs data shows that in June 2025, China exported approximately 21.7GW of photovoltaic modules, a 3% month-on-month decrease and a 2% decrease compared to 22.1GW in June 2024. From January to June, the cumulative export of photovoltaic modules was approximately 127.3GW, a 3% decrease compared to the same period last year [5]