Summary of Boqian New Materials Conference Call Company Overview - **Company**: Boqian New Materials (605376.SS) - **Market Cap**: Rmb12.2 billion / $1.7 billion - **Target Price**: Rmb47.00, current price Rmb46.80, indicating an upside of 0.4% [1][4][63] Key Industry Insights MLCC Electrode Materials - **Recovery and Growth**: The MLCC electrode material business is experiencing a faster-than-expected recovery, with a year-on-year net profit increase of 48% [1][58]. - **Capacity Expansion**: Boqian announced a 60% capacity expansion, the first since 2022, which aligns with its enhanced role in SEMCO's supply chain, particularly for AI-server and auto-grade MLCCs [2][17][19]. - **Product Mix Upgrade**: The upgrade in product mix, particularly the use of 80nm nickel powder, has led to improved pricing and margins, with expectations of a sustainable recovery trajectory for ASPs and GPMs [2][35][41][46]. - **Volume Growth**: The company is on track to renew peak shipment volumes, expecting a 27% CAGR in volume from 2025 to 2027 [19][24]. Solar Conductive Materials - **Reviving Opportunities**: There are early signs of recovery in the solar conductive materials segment, particularly for copper-based powder products, which are expected to benefit from the adoption of Topcon and XBC technologies [16][52]. - **Market Potential**: The segment could see its gross profit contribution double from 12% to 22% by 2027, driven by the increasing penetration of new solar cell technologies [53][54]. Financial Performance - **Earnings Estimates**: EPS estimates have been raised by 38-47% for 2025 and 2026, with a new 2027 EPS estimate of Rmb2.00/share, reflecting a 43% year-on-year increase [1][58][59]. - **Revenue Projections**: Revenue forecasts for 2025, 2026, and 2027 are Rmb1,156.5 million, Rmb1,606.7 million, and Rmb2,157.8 million respectively [4][60]. - **Valuation Metrics**: The company is currently rated Neutral, with a P/E ratio projected to decrease from 70.3 in 2024 to 23.4 by 2027 [10][63]. Risks and Considerations - **Market Risks**: Potential risks include slower-than-expected penetration into SEMCO's supply chain, mass production challenges for copper-based products, and uncertainties surrounding new product developments [64]. - **Management Risks**: Concerns regarding leadership succession and the ability to maintain R&D talent could impact future growth [64]. Conclusion Boqian New Materials is positioned for significant growth in both its MLCC electrode materials and solar conductive materials segments, supported by capacity expansions and product mix upgrades. The company’s financial outlook has improved, leading to substantial revisions in earnings estimates and target prices. However, investors should remain cautious of market and management risks that could affect performance.