Core Viewpoint - The carbon fiber industry is currently in a recovery phase from a cyclical bottom, with signs of price stabilization and improved supply-demand dynamics [1] Price Trends - As of August 2025, the market prices for mainstream carbon fiber models in East China are as follows: T300-12K at 85 RMB/kg, T300-24/25K at 75 RMB/kg, T300-48/50K at 70 RMB/kg, and T700-12K at 105 RMB/kg [1] - Domestic carbon fiber prices have remained relatively stable since the beginning of 2025, providing a stable external environment for improving industry profitability [1] Industry Recovery Indicators - As of August 2025, the industry operating rate has recovered to 61.52%, an increase of 10.02 percentage points since the beginning of the year, indicating signs of partial recovery [1] - The carbon fiber industry is experiencing a gradual restoration of supply-demand balance following previous price adjustments and capacity reductions [1] Strategic Focus Areas - Companies are advised to focus on three main areas: 1. High-end applications in aerospace, drones/eVTOL, with production capabilities for 3K yarn and T700 grade or higher high-performance carbon fibers [1] 2. Companies with advantages in the new energy industry chain, particularly those closely tied to quality customers in wind power and hydrogen energy, possessing cost advantages and economies of scale [1] 3. Suppliers with clear overseas expansion strategies, showcasing strong export performance and actively exploring international markets [1]

Core Viewpoint - The carbon fiber industry is currently in a recovery phase after reaching a cyclical bottom, with supply-demand dynamics gradually improving and prices stabilizing after significant adjustments [1][2] Group 1: Industry Characteristics - In 2024, China's carbon fiber industry will exhibit three main characteristics: a slowdown in capacity growth, significant regional differentiation, and product structure upgrades [1] - New carbon fiber capacity in China is expected to reach 15,300 tons in 2024, bringing total capacity to 135,500 tons, a year-on-year increase of 12.73% [1] - The production volume for carbon fiber in 2024 is projected to be 59,000 tons, reflecting an 8.16% year-on-year increase, with T300 grade fibers accounting for 63.58% and T700+ grade fibers for 36.42% [1] Group 2: Market Outlook - By 2025, the carbon fiber market is expected to show price stabilization and recovery in certain sectors, with the industry operating at a 61.52% utilization rate as of August 2025, a year-on-year increase of 14.92 percentage points [2] - The prices for mainstream carbon fiber models in East China have remained stable since the beginning of 2025, providing a stable external environment for improving profitability in the industry [2] - The second half of 2025 is anticipated to see a "structural differentiation" in prices, with high-performance T700/T800 prices expected to rise, while industrial-grade T300 may experience pressure [2]

Investment Rating - The report maintains an "Accumulate" rating for the company [4][8]. Core Views - The company faces pressure from weak demand and declining sales, but it is taking measures to enhance competitiveness [7]. - The carbon fiber sales volume decreased by 10.12% in 2024, with an inventory increase of 61.45%, indicating a mismatch in supply and demand [7]. - The average price of carbon fiber products fell by 23.44% year-on-year, with a current industry gross margin of -18.30%, suggesting profitability challenges for most manufacturers [7]. - The company is focusing on high-end product output and cost advantages to improve profitability [7]. - The company has a strong market position in the new energy sector, with over 50% market share, and aims to increase its market share further in 2025 [7]. Financial Summary - In 2024, the company reported revenue of 1.557 billion yuan, a decrease of 31.07% year-on-year, and a net profit attributable to the parent company of -124 million yuan, down 139.12% [6]. - The company’s earnings per share (EPS) for 2024 is projected at -0.14 yuan, with a forecasted recovery to 0.38 yuan by 2027 [4][20]. - The company’s net profit forecast for 2025-2027 has been adjusted to 340 million, 1.75 billion, and 3.39 billion yuan respectively [7][20]. Market Position and Strategy - The company is the only domestic enterprise with mature technology for dry-jet wet-spinning carbon fiber production, with a current capacity of 28,500 tons [7]. - The company is expanding its production capacity with a new 30,000-ton facility expected to begin trial production in 2025 [7]. - The product matrix includes a full range of carbon fiber varieties, and the company has successfully developed several high-end products in 2024 [7].