CJS(SH:600176)2026-01-08 02:07Summary of Key Points from Conference Call Industry Overview - The fiberglass industry is expected to experience a significant reduction in net new capacity in 2026, projected to be between 220,000 to 400,000 tons, a sharp decline from 900,000 to 1,000,000 tons in 2024, indicating a supply-side contraction that will enhance price elasticity in the fiberglass sector [1][2] - Demand for fiberglass is diversified across various sectors including real estate, infrastructure, electronics, automotive, wind power, and home appliances, with global and domestic market growth rates expected to remain between 5% to 8%, outpacing GDP growth [1][2][4] Core Insights and Arguments - The ordinary electronic cloth market is experiencing a supply shortage and rising copper prices, leading to a strong certainty of price increases, with leading company China Jushi's net profit per unit for electronic cloth nearing 1 yuan, compared to a previous cycle high of 1.4 yuan [1][5] - Coarse sand products are benefiting from increased penetration of new energy vehicles and rising overseas infrastructure projects, with automotive sand expected to maintain double-digit growth and export volumes likely to increase [1][5] - China Jushi aims to achieve over 3 billion yuan in profit for the 2024-2025 period, with significant profit elasticity; a price increase of 0.5 yuan per meter could add 500 million yuan in profit [1][6] Company Performance - China Jushi has demonstrated strong performance, with net profit per unit rising from 0.6 yuan to nearly 1 yuan due to multiple price increases, and has a historical peak of 1.4 yuan per unit [6] - The company is expected to continue leveraging price increases and incentive mechanisms to enhance performance, making it a key investment target [6][8] Market Trends - The global composite materials industry has a production volume of approximately 11 to 12 million tons, with over 50% used for exports; the wiring industry has achieved domestic substitution, establishing a China-led global landscape [7] - The overseas composite materials market is in a rapid penetration phase, similar to China's experience from 2000 to 2010, with high-end markets like U.S. real estate repair and reconstruction in Ukraine driving demand growth [7][8] AI Electronic Cloth Market - The AI electronic cloth market is rapidly evolving, with leading companies like Feilihua facing inventory shortages and a current tax-inclusive price of around 280 yuan, indicating significant upward potential as demand opens up [3][9] - Pre-orders for 2026 have begun, suggesting that market expectations and opportunities will expand further into 2027 [9] Recommendations - Key investment recommendations include China Jushi for the fiberglass sector, and for the AI electronic cloth direction, companies like Zhongcai Technology, Feilihua, and International Complexity are highlighted as first and second-tier players with promising prospects [10]