YANTAI TAYHO(SZ:002254)2026-01-06 07:14Group 1: Cost and Quality Improvement - The main goal of the spandex transformation is to improve quality rather than just reduce costs. The previous production facility in Yantai had lower capacity but unique products, while the new facility in Ningxia faced quality fluctuations. The company aims to complete improvements by mid-2026, which will enhance quality and efficiency, ultimately reducing losses [2][3]. - Current production costs are high due to low operational rates and quality issues. As quality improves, costs are expected to decrease, and there is potential for price increases based on market reputation [3][4]. Group 2: Market Dynamics and Demand - Spandex demand has historically grown at an average rate of around 10% per year, but fluctuations can occur based on market conditions. The company does not foresee any explosive growth in 2025 [3][4]. - Exports of spandex account for less than 10% of total production, primarily to neighboring countries. The company aims to increase exports but faces challenges due to local industry protection and tariffs [4]. Group 3: Product Segmentation and Pricing - The company has a significant market share in domestic aramid fibers, with approximately 60-70% for meta-aramid and 50-60% for para-aramid. However, pricing pressures are evident, and the market is competitive [4][5]. - The demand for aramid paper is expected to grow, driven by sectors like power grid upgrades and commercial aviation, with potential for double-digit growth primarily in volume rather than price [5][6]. Group 4: Future Strategies and Innovations - The company is exploring new business solutions, including safety products and digital printing technologies, aiming to create a closed-loop supply chain with clothing brands [6]. - Long-term goals include increasing international market share, particularly in the aramid sector, with aspirations to become a global leader. There may be plans for overseas production facilities in the future [6].