Report Overview - The report is about a research on Taihe New Materials in the chemical fiber industry on March 4, 2026, with participation from institutions like Macquarie Securities [1][2][17] Report Core View - The company has potential for improvement in product prices, production rates, and cost reduction through technological upgrades, but the recovery degree is uncertain [25][26][34] Group 1: Research Basic Information - Research object: Taihe New Materials [17] - Industry: Chemical fiber industry [2][17] - Reception time: 2026 - 03 - 04 [17] - Company reception staff: Securities affairs representative Yu Liwei and board office staff [17] Group 2: Detailed Research Institutions - Institution: Macquarie Securities, with reception staff Feng Junjiao, Li Erpeng, and Miao Huaxin [20] Group 3: Main Content Data Product Capacity - The company has 16,000 tons of both meta - aramid and para - aramid capacities, ranking second globally in meta - aramid and third in para - aramid [22] Production Base - Production bases are in Yantai and Ningxia. Meta - aramid capacity is all in Yantai, while para - aramid is in both Yantai and Ningxia [23] Product Price - Last year, aramid prices were at a relatively low historical level, and the probability of price decline is low with potential for recovery, but the recovery degree is uncertain [24][25] Raw Materials - Aramid raw materials are mainly diamine and acid chloride, including m - phenylenediamine, p - phenylenediamine, m - phthaloyl chloride, and p - phthaloyl chloride, which are related to petroleum and supplied by fine - chemical companies [25] Production Rate - The company expects the spandex production rate to increase as the industry pattern improves. The aramid production rate depends on market demand [26] Gross Margin Maintenance - Aramid has high technical barriers, and the company is the only national aramid engineering technology research center in the industry [27] Technical Difficulty - Technical difficulty lies in a combination of market, industry, and technology aspects, and market and customer maintenance is also important [28] Business Expansion - Whether to expand the aramid sector depends on market demand, and there are no technical problems [29] Sales Pattern - Over 90% of para - aramid is supplied domestically, and the overseas proportion is not high. Spandex is mainly sold through agents [32][31] Spandex Situation - The industry's effective spandex capacity is about 1.3 million tons, and the company ranks fifth, with global capacity mainly concentrated in China [33] Product Improvement - The company is conducting R & D and iterative upgrades on spandex and para - aramid. If the verification is successful, it may increase capacity, reduce costs, and improve quality [34] Financial Leverage - The company's asset - liability ratio is in the 40s [36] Cost Reduction - Spandex cost reduction is mainly achieved through technological transformation in polymerization, spinning, and public works, with polymerization transformation almost completed and spinning transformation expected to finish by the end of the year [36]

Group 1: Production Capacity - The company has two types of aramid fibers: meta-aramid and para-aramid, each with a production capacity of 16,000 tons, ranking second and third globally, respectively [2][3] - Production bases are located in Yantai and Ningxia, with meta-aramid produced solely in Yantai and para-aramid produced in both locations [2] Group 2: Market Trends and Pricing - Last year, aramid prices were at historically low levels, but the company anticipates a recovery in prices, although the extent of recovery remains uncertain [2][3] - The company expects an increase in operating rates for spandex as the industry landscape improves, while aramid production rates will depend on overall market demand [3] Group 3: Raw Materials and Supply Chain - The main raw materials for aramid production are two types of diamines and acyl chlorides, which are influenced by oil prices [3] - Direct suppliers are companies involved in fine chemicals [3] Group 4: Financial Metrics - The company's asset-liability ratio is over 40% [4] - The company ranks fifth globally in spandex production capacity, with approximately 130,000 tons of effective industry capacity concentrated domestically [3][4] Group 5: Technological Advancements - The company maintains a high technical barrier in aramid production, being the only one with a national aramid engineering technology research center [3] - Ongoing engineering and technological upgrades for spandex and para-aramid are expected to reduce costs and improve quality, with potential capacity increases if validations are successful [4]