On March 6, Hong Kong stock polysilicon leader GCL Technology (03800HK) announced that the company expects to achieve a net profit attributable to the parent company of about 2.3 billion yuan to 2.6 billion yuan in 2023, a significant decrease of about 84% to 86% year-on-year.
According to the data, GCL Technology's main product is granular silicon, which refers to the granular polysilicon produced by the silane method, which is mostly used in n-type cells, which is also the company's trump card product. Compared with polysilicon, granular silicon has the characteristics of low cost, low energy consumption and low emission, which is more in line with the trend of carbon neutrality.
However, with the boom of polysilicon, the production capacity of the entire industry has expanded wildly, resulting in oversupply, and polysilicon has appeared in just over a year, and granular silicon is certainly not immune.
According to the data, polysilicon materials** have dropped from about 260 yuan kg at the end of 2022 to about 71 yuan kg recently, a drop of more than 7%. This may be the reason for the sharp "dive" in GCL Technology's performance, which was also highlighted in the announcement.
In addition, GCL Technology**Xinjiang Gones Energy Technology*** and impairment losses on property, plant and equipment are also one of the reasons for the decline in profits.
Other polysilicon leaders such as Daqo Energy (688303).SH) has announced last year's performance report, and the company will achieve revenue of 163. in 20232.9 billion yuan, a year-on-year decrease of 4722%, and the net profit attributable to the parent company was 576.3 billion yuan, a year-on-year decrease of 6986%。From the current situation, the situation of oversupply in the industry is difficult to change in the short term, and the profitability of listed companies is under pressure or a common phenomenon.
In fact, there are a number of listed companies under the "GCL system", including GCL Integration (002506SZ), GCL New Energy (00451.)HK), GCL-ET (002015SZ), the business scope involves the upstream and downstream of the photovoltaic industry chain, and the boss behind it is Zhu Gongshan, who is known as the silicon king of Jiangsu.
So far, GCL Integration has also announced a performance forecast, the company is expected to achieve revenue of 15.5 billion yuan to 17.5 billion yuan in 2023, and is expected to achieve a net profit attributable to the parent company of 1$500 million to 2200 million yuan, a significant increase of 152 year-on-year87% to 27088%。
GCL-SI's main product is the downstream PV module segment, which has benefited from the price reduction of polysilicon and the change in the competition pattern of the industrial chain. Last year, the company's module business shipments ranked among the top in the industry, with both production and sales booming, and profitability improved significantly. According to industry data, GCL-SI's module shipments will return to the top 10 in the industry in 2023, and its market competitiveness will continue to improve.
It is worth noting that both GCL Technology and GCL Integration have continued to bear in the past year, and many investors have been deeply trapped, saying that they "no longer believe in light", and there are also many institutional investors, including the famous "friend of time" - Hillhouse Capital.
According to the data, in December 2021, Hillhouse took a stake in GCL Technology. In June 2022, Hillhouse Capital re-entered GCL Integration, and the latter's holding subsidiary, OSW, introduced a strategic investor, VNTR, through capital increase and share expansion, and the controlling shareholder of VNTR is Hillhouse Investment Management***
On the whole, PV is currently in a period of fierce involution, and life is not easy, even if the downstream module segment is profitable, but the valuation level is still declining, and the capital market is quite cautious. In the long run, PV may still be the track with long slopes and thick snow, and it is worth investors to continue to track when the industry competition pattern can improve and when the stock prices of related companies will recover.
Author: Flying Fish.