Core Viewpoint - The photovoltaic industry is facing a significant policy shift as the export tax rebate for photovoltaic products is fully canceled, marking the end of a supportive policy environment and leading to a historical turning point for the industry [1][2]. Policy Changes - The Ministry of Finance and the State Taxation Administration announced the cancellation of the export tax rebate for photovoltaic products starting April 1, 2026, transitioning the industry into a "no rebate subsidy" phase [2]. - The export tax rebate policy, which began in October 2013, has seen a gradual decline in rebate rates, dropping from 13% to 9% for photovoltaic silicon wafers, batteries, and modules as of December 1, 2024 [2]. Market Reaction - The market reacted sharply to these policy changes, with the sentiment in the polysilicon market plummeting, leading to significant declines in polysilicon futures and related stocks such as Daqo New Energy and Tongwei Co., Ltd. [1][3]. - On January 8, polysilicon futures dropped by 9%, followed by an 8% decline on January 9, reaching a low of 50,080 yuan/ton [3]. Industry Self-Regulation - The industry self-regulation phase has entered a new stage, with the State Administration for Market Regulation holding discussions with major companies regarding monopoly risks and requiring them to avoid agreements on production capacity, sales prices, and market division [3][4]. - The self-regulation efforts that began in 2025 had initially helped stabilize prices, but the recent regulatory changes indicate a shift away from relying on such practices [4]. Price Dynamics - Despite rising prices for upstream polysilicon and silicon wafers, downstream module prices have not followed suit, leading to squeezed profit margins for developers [5][6]. - The average transaction price for N-type polysilicon was reported at 59,200 yuan/ton, reflecting a week-on-week increase of 9.83%, while N-type G10L monocrystalline silicon wafers saw a price increase of 9.17% [5]. Demand Outlook - The first quarter is traditionally a weak demand season for the photovoltaic industry, with both domestic and overseas markets showing signs of slowing order execution and limited visibility for new orders [7]. - The overall market demand has been declining, and the anticipated price increases for components face significant resistance due to low demand [6][7]. Market Valuation - The shift in policy is prompting a "value reassessment" in the capital market for the photovoltaic sector, with significant sell-offs observed in the stock market [8]. - From January 8 to 9, the photovoltaic sector experienced a notable decline, with polysilicon futures dropping by 10.2% and major companies like Tongwei Co., Ltd. and GCL-Poly Energy Corp. seeing substantial stock price decreases [8]. Investment Opportunities - Despite the challenges, the photovoltaic industry's overall valuation is at historical lows, which may present attractive investment opportunities compared to other sectors [8]. - Companies with advantages in technology iteration, cost control, and global channel layout are expected to be identified as potential investment opportunities amidst the changing landscape [8].

Core Viewpoint - The photovoltaic industry in China is facing a significant policy shift with the complete cancellation of export VAT rebates and the halting of industry self-regulation, marking a historical turning point for the sector [3][4]. Policy Changes - Starting April 1, 2026, the export VAT rebate for photovoltaic products will be fully canceled, transitioning the industry into a "no rebate subsidy" phase [4]. - The export VAT rebate policy, initiated in October 2013, has seen a gradual decline in rebate rates, dropping from 13% to 9% as of December 1, 2024, indicating a move towards the cancellation of rebates [4]. Market Reactions - The market reacted sharply to these policy changes, with the price of multicrystalline silicon contracts dropping significantly, and major companies like Daqo New Energy and Tongwei Co. experiencing substantial stock declines [3][5]. - On January 8 and 9, 2026, the main contract for multicrystalline silicon futures fell by 9% and 8% respectively, reaching a low of 50,080 yuan/ton [5][11]. Industry Self-Regulation - The recent discussions between the State Administration for Market Regulation and leading companies in the silicon material sector indicate a shift away from previous self-regulatory practices, which had aimed to stabilize prices through coordinated production and sales strategies [5][6]. - The new regulatory environment prohibits companies from coordinating on production capacity, sales volumes, and pricing, which could lead to increased market volatility [5][6]. Price Dynamics - Despite rising prices for upstream materials like silicon and silicon wafers, the prices for downstream components have not followed suit, squeezing profit margins for developers [9]. - The average transaction price for N-type multicrystalline silicon was reported at 59,200 yuan/ton, reflecting a week-on-week increase of 9.83%, while N-type G10L monocrystalline silicon wafers saw a price increase of 9.17% [9]. Demand and Market Outlook - The first quarter is traditionally a low-demand season for the photovoltaic industry, complicating the acceptance of price increases by end-users [10]. - The overall market demand has been weakening, with a decline in order visibility for both domestic and overseas markets as the year-end approaches [10]. Capital Market Impact - The shift in policy is prompting a "value reassessment" in the capital markets for the photovoltaic sector, leading to significant sell-offs and pressure on valuations [11]. - From January 8 to 9, 2026, the photovoltaic sector experienced a notable sell-off, with major companies like Tongwei Co. and GCL-Poly Energy facing significant stock price declines [11].