In the photovoltaic industry, technology-driven cost reduction and efficiency improvement are still continuing.
Recently, new photovoltaic technologies have progressed very rapidly, with LONGi's HBC technology and Tongwei's HJT modules once again setting world records for conversion efficiency, and Aiko has also released the industry's first bifacial BC module.
From the demand side, the growth rate of PV in the next few years is not weak. Just recently, the Global Renewable Energy and Energy Efficiency Pledge was signed, in which 118 countries pledged to triple their renewable energy capacity to 11,000GW by 2030, while doubling energy efficiency.
At the heart of this is photovoltaic and wind power, and according to the data, by 2030, the world will add at least 4,600 GW of solar and wind energy to achieve the goal, which will drive more than $5 trillion in investment.
You must know that the current photovoltaic and wind power have taken nearly 20 years to reach their current scale, and they will double again in only about 6 years in the future, which shows the rapid growth of the industry.
At present, we feel that the downturn in the photovoltaic industry, and the sharp decline in the market value of leading companies such as LONGi, Tongwei, JA Solar, and Trina Solar, is only a supply and demand problem of the industrial chain capacity structure, and it is only a phase, and the installed capacity of the industry is still growing rapidly, and the new installed capacity of PV in mainland China will reach 78.42GW in the first half of 2023, a year-on-year increase of 154%.
Under the growth of the industry, there are also very good signs of PV capacity reduction. According to the latest data, the prices of M10 mono wafers (182 mm / 150 μm) and N-type mono wafers (182 mm / 130 μm) have begun to stabilize and stop falling, and there is a tight supply situation on the N-type side.
Therefore, under the strong demand for overall installed capacity and the bottoming of inventory and production capacity at the stage, the repair of photovoltaics is expected to be very strong.
Among them, Oujing Technology, which sells shovels, will have better performance elasticity under the scarcity advantage.
The core product of Oujing Technology is quartz crucible, which is also the first share of quartz crucible. Quartz crucibles are essential consumables for the production of monocrystalline silicon wafers, which also makes them essential for the manufacture of photovoltaic cells and semiconductor chips.
In recent years, with the rapid installation of photovoltaic capacity, the company's products are in short supply, and in 2022, the company's quartz crucible sales will be 121,200, and the average unit price will be about 6,200 yuan each.
The company's performance has also ushered in explosive growth, even in the first three quarters of 2023 under the influence of the photovoltaic price war, the profits of leading companies such as LONGi, Tongwei, and TCL Zhonghuan have declined sharply, but Oujing Technology still achieved a net profit of 5.88 in the first three quarters of 2023, a year-on-year increase of 280%.
As a shovel enterprise, Oujing Technology currently has a strong logic of rising volume and price!
First, the volume increase.
Because quartz crucible is the core consumable for the production of silicon wafers, it is a consumable, and it will be scrapped after one or several times of heating and pulling the crystal, which leads to the demand for far from continuous, which mainly comes from four aspects.
1. The increase in the demand for new installed photovoltaic capacity.
This is also what we mentioned earlier, in the relevant target line, the growth rate of global photovoltaic installation in the next few years is still very fast, and the new global photovoltaic installed capacity is expected to exceed 350GW in 2023, with a growth rate of more than 50%. This is a process of continuous and substantial growth in demand for quartz crucibles.
2. Domestic quartz sand is replaced, and the loss increases.
Because the quartz crucible is divided into three layers, the inner layer of high-purity quartz sand requirements are very high, and the supply of this piece is currently very tight. It leads to the substitution of domestic quartz sand, which also leads to the reduction of the service life of the quartz crucible and the increase of crucible loss.
According to the data, the average service life of the quartz crucible industry is about 250 hours, and the number of quartz crucibles required in 2023 will be about 1.17 million, and the market size will reach 15 billion yuan.
3. Accelerated penetration of N-type technology.
At present, the penetration rate of N-type silicon wafers in the photovoltaic industry is very fast, and due to higher technical requirements, the service life of N-type crucibles is shorter. The data shows that the service life of the N-type crucible is 50 hours shorter than that of the P-type crucible.
As a result, with the expansion of N-type silicon wafer production, the demand for quartz crucibles has increased significantly.
4. The semiconductor industry is picking up.
As we said earlier, quartz crucibles are also essential consumables for the manufacture of semiconductor silicon wafers, and at present, the price of memory chips is rising, and the consumer electronics industry has shown signs of recovery.
This has led to a new round of expansion cycle in the demand for semiconductor silicon wafers, and the demand for quartz crucibles has also increased significantly.
At present, Oujing Technology has completed the R&D and mass production of 32-inch semiconductor-grade quartz crucibles, and 28-inch semiconductor-grade quartz crucibles have been supplied to downstream customers.
Second, price increases.
Although quartz crucible is a necessary product for photovoltaic and semiconductor silicon wafers, it accounts for a small proportion of the entire silicon wafer production cost, which leads to the insensitivity of enterprises to the price of quartz crucibles, resulting in obvious price increases in recent years, which can be seen from the significant increase in the gross profit margin of Oujing Technology products.
In the future, there are three driving factors for the rise in the price of quartz crucibles.
1. Large-size silicon wafers.
The large size of silicon wafers is also the key to reducing the cost and increasing the efficiency of photovoltaics, and the larger the size of the silicon wafer, the higher the technical requirements and the higher the price.
According to the data, in 2021, the average price of the company's quartz crucibles above 28 inches reached 5,714 yuan, a year-on-year increase of 47%.
In the future, with the larger the size, the price will continue to increase, and Oujing Technology's current 40-inch ultra-large solar-grade quartz crucible can be mass-produced.
2. N-type silicon wafers require higher quality quartz crucibles.
The accelerated penetration of N-type technology has brought incremental space for quartz crucibles, while N-type crucibles require a higher proportion of high-purity quartz sand, which has further promoted the rise in the price of quartz crucibles.
In 2023, Oujing Technology's production capacity is expected to increase to 20 production lines, and the output of quartz crucibles is expected to reach 220,000.
3. Raw materials are in short supply
At present, there are only three companies in the world that can produce high-purity quartz sand, namely Sibelco (Unimin) in the United States, TQC in Norway and quartz shares in the mainland.
However, only Unimin and TQC can provide high-purity quartz sand in the inner layer, and they are only produced by one mine in the United States, and the production capacity is very small.
Under the huge demand for photovoltaics, the price of quartz sand has risen very rapidly, just like the natural bezoar of Pien Tze Huang. In November 2023, the average price of high-purity quartz sand for the inner layer of quartz crucible has exceeded 415,000 yuan/ton.
The quartz crucible has also continued to rise in price because the price of upstream enterprises is not sensitive and the supply is also very tight. Oujing Technology binds Unimin, and the upstream raw materials are more stable.
It should also be emphasized here that in April 2023, Unimin announced a doubling of production capacity expansion in 2025, which led to a decrease in the market's expectations for the price increase of quartz sand.
In fact, the total production capacity of Unimin and TQC inner layer high-purity quartz sand in 2022 is about 25,000 tons, of which Unimin is about 15,000 tons. Even if Unimin doubles its production, the total production capacity of layer sand will be about 40,000 tons per year by 2025.
From the current point of view alone, the demand for domestic layer in 2025 will be at least 50,000 tons, which is still far from meeting the demand, and there is still a large gap. And with the accelerated release of the demand side of photovoltaics and semiconductors, the demand for quartz sand is still being released significantly, and the logic of price increases remains unchanged.
Therefore, as a scarce leader in quartz crucibles, Oujing Technology fully benefits from the dual demand growth of photovoltaics and semiconductors, and its performance elasticity is better.
The key is that this kind of shovel enterprise will also have a stronger ability to resist risks.
Special statement: The content only represents personal views and does not constitute any investment guidance, according to which you buy and sell, profit and loss at your own risk, the stock market is risky, and investment needs to be cautious!