The frenzy of losing rationality, the anxiety of extreme involution, the anxiety of periodic adjustment, the loss under prosperity, the confusion under policy fluctuations, and the calmness and determination under the dual carbon strategy have condensed the faces of all beings in the photovoltaic industry in 2023.
From the rapid expansion of production at the beginning of the year, to the diving of the whole industry chain in the middle of the year, to the price reduction of modules like a broken kite, and then to the blowout of photovoltaic installed capacity "one year to four years", photovoltaic in 2023 has obviously experienced a roller coaster**, and the major photovoltaic manufacturers involved in it have joys and sorrows, gains and losses.
In this industry where technology iterations, policy changes, and market fluctuations rotate like a marquee, there are too many uncontrollable variables, outlining a clear but vague future for the whole industry. The head manufacturers are determined in the dual carbon strategy, and they are confident in the future of advanced production capacity, and the waist and tail manufacturers are facing the embarrassment of "de-capacity", which will be further fermented in 2024.
Undoubtedly, in the era of expansion after 2024, how the photovoltaic industry will promote its evolution will become the focus of attention.
**1: Photovoltaic stocks**
The capital market is the barometer of the real economy, which is related to the direct financing of IPOs, and whether the direct and indirect financing channels such as private placement and the issuance of convertible bonds are smooth or not, to a certain extent, also determines the rise and fall of the photovoltaic industry. After the "waist chop", "knee chop", "ankle chop" and "hip chop" in 2023, the space for the photovoltaic sector is extremely limited. Therefore, our first**, the photovoltaic sector will bottom out in 2024**, closing a red line on the annual line. Of course, PV stocks may also follow the "L" bottom trend after hitting the bottom, and it will take a long time to regain the upward trend. But the sixth sense tells us that after the best photovoltaic stocks, the risk has been greatly released.
**2: Reduction in installed capacity
PV in 2023 is a year of history and brilliance. 216 new ones in a year88GW of installed capacity, almost the sum of the four years in 2019, 2020, 2021 and 2022, is already an achievement that shocks the past and the present. Although under the dual carbon strategy, the installed capacity of photovoltaic will increase in the future, and even add 500GW of new capacity in one year, but from the perspective of achieving the target of 1.2 billion kilowatts of wind power and photovoltaic installed capacity ahead of schedule, the pressure on the new installed capacity of photovoltaic and wind power has been slowed down. Moreover, the concentrated burst of photovoltaic installed capacity has put a lot of pressure on the capacity carrying of the power grid and the absorption of power generation, which requires a process of digestion and absorption.
Institutions are cautiously optimistic about the growth of the PV market in 2024. CITIC's new PV installed capacity in 2024 will reach 200GW-210GW, which is basically based on the installed capacity in 2023, which is not much different from LONGi Green Energy's 50 yuan when it still sings more than 80 yuan. China Electricity Council**, the new installed capacity of photovoltaic will reach 171GW in 2024. 216, so to speak, in 202388GW will be a phased high point for PV installations.
3: PV stabilized
Entering 2024, the bottoming action of the four major manufacturing links of polysilicon, silicon wafers, cells and photovoltaic modules will continue, and it is expected to usher in a process of stopping the decline and stabilizing. Photovoltaic modules fell below 1 yuan watt and fell to 08x yuan, the whole industry is in a loss-making situation, which is not the norm of normal business activities.
It is expected that the photovoltaic industry will return to normal after accelerating the elimination of backward and obsolete production capacity and cleaning out excess capacity. Recently, polysilicon has shown signs of stopping its decline, indicating that the upstream production capacity has achieved initial results, and it is expected that this process will continue to repeat itself, and the main theme will remain unchanged.
**4: Photovoltaic performance inflection point
Ultra-high speed, high double-digit revenue, and more than 3-digit net profit growth can be difficult to maintain in any industry for a long time, and for an industry, it is not healthy to have negative growth and net loss for a long time. After the photovoltaic industry has driven the era of high growth driven by a tight balance for many years, it will enter an era of moderate growth in performance as the production capacity of each link tends to be balanced, maintaining a net profit growth range of 30%-50%.
At present, the photovoltaic industry may move from high growth to low growth, or even negative growth, because modules and other modules fall below the cost line and continue to operate at a low level, which will not only impact the performance of the fourth quarter of 2023, but also continue to affect the performance of Q1, Q2 and Q3 in 2024. It is expected that the photovoltaic industry may not climb out of the pit of weak performance until the second half of the year, and the industry will not improve until it stabilizes.
**5: Photovoltaic reshuffle accelerates
Whether the performance of photovoltaic has ushered in an inflection point depends on the process of reshuffle of the photovoltaic industry in principle. If the reshuffle accelerates and the industry ushers in a cycle inflection point, the inflection point in the performance of listed companies will also appear simultaneously.
Judging from the production capacity of each link and the continuation of capacity expansion, a comprehensive reshuffle of the photovoltaic industry is inevitable. The production capacity of wafers, cells and modules has exceeded 1,000GW, far exceeding the current global PV installed demand, which means that the market will definitely wash out excess capacity. At present, the first photovoltaic stocks, modules continue to hover at 08x yuan low, this is the way the industry reshuffles.
A sharp fall will have a V-shaped reversal, and boiling frogs in warm water is more tormenting, so the photovoltaic industry is rushing to usher in an inflection point as soon as possible, restoring normal industry order, and accelerating the reshuffle is a must.
**6: The residential market is decelerating
Since 2019, residential PV has been an important driving force in the installed capacity market, with a cumulative installed capacity of 105GW in the past five years, equivalent to the capacity of more than 4 Three Gorges Power Stations, and the cumulative number of installed households has exceeded 5 million. It is expected that there will be an additional 216 in 2023Of the 88GW installed capacity, residential PV installations may contribute around 50GW of new increments.
Theoretically speaking, there is still more room for development of household photovoltaics in the future. However, after continuous explosive growth, the potential of core markets such as Shandong and Hebei has been fully released, and new growth poles have not yet been fully cultivated. At the same time, the carrying capacity of the power grid is limited, and some areas have suspended the filing and grid connection of household PV due to the capacity of the power grid, which will hit the market enthusiasm to a certain extent. In addition, some power areas have introduced policies such as time-of-use electricity prices and mandatory distribution and storage, which will also dilute a certain amount of installed demand. Therefore, compared with the explosion of the market in 2023, residential PV will have a year-on-year decline.
**7: PV layoffs increase
The cyclical adjustment of the photovoltaic industry has been transmitted to the enterprise level. According to the list of layoffs that flowed out of the market in November, some leading manufacturers in the industry have launched a downsizing plan and put it into practice. At the same time, there are also rumors in the market that manufacturers are in arrears of employees' wages. It is expected that with the adjustment and reshuffle, there will be manufacturers with poor management and limited capital reserves to optimize costs and personnel structure.
**8: Expansion tends to be rational
The first half of 2023 and 2024 is the concentrated release period for expansion projects, and the expansion of the photovoltaic industry has not stopped, and the momentum of slowing down the expansion is not obvious. However, after the industry reshuffle accelerates and deepens, the expansion will be significantly reduced. The expansion of production will be more concentrated in manufacturers with strong financial strength, and the number of new cross-border players will be greatly reduced.
When the number of shutdowns increases when it is put into production, and the performance of more manufacturers turns from profit to loss, other manufacturers will reduce the impulse to blindly expand production after realizing the risk. In addition, it has been noted that in the cross-border photovoltaic movement, there are many individual manufacturers who have the concept of cross-border rubbing and partnering with institutions to manipulate stock prices, and the supervision and punishment should also keep up, so as not to "game" photovoltaic and deceive investors.
**9: The involution of technology is white-hot
With the advent of the industry adjustment cycle, the involution of next-generation battery technologies such as TOPCON, HJT, BC, and perovskite will also become more intense. In fact, starting from 2023, various manufacturers have competed in the conversion efficiency, power, size, attenuation rate, and the current technology mainstream and future technology mainstream, and it is expected that this phenomenon of seizing the technological mainstream and the strategic commanding heights of conversion efficiency will become more prominent in 2024.
**10: Photovoltaic accelerates "going to sea".
Under the background of phased overcapacity, photovoltaic enterprises have accelerated their overseas expansion and found new growth poles to become an inevitable path for growth and development. At present, JA Solar, JinkoSolar, Trina Solar, Canadian Solar, and LONGi Green Energy are all planning to build module factories in the United States, while GCL Technology, Risen Energy, TCL Zhonghuan and other manufacturers are also accelerating their overseas market layout.
The white-hot domestic "involution" and the opening up of a second overseas battlefield are a good way to take the initiative to seek change and achieve self-breakthrough. Photovoltaic companies will also increase overseas marketing efforts, participate more in domestic and foreign photovoltaic exhibitions, develop new customers, and strive for more orders.
From the perspective of leaving a beautiful earth for future generations, the development of the photovoltaic industry has a bright future, and the development space is unlimited. In the short term, there is a stage of overcapacity, and PV needs to "de-capacity". (Grassroots PV).