20220905-招银国际-协鑫科技-03800.HK-NDR_takeaways__On-track_capacity_growth___cost_reduction_3页_427kb

GCL Technology (3800 HK) Summary

Core Content

This document provides an equity research update on GCL Technology (3800 HK), focusing on its production capacity expansion, cost reduction strategies, and advancements in perovskite solar cell technology. The report also includes stock data, shareholding structure, and performance metrics, along with important disclosures and compliance information.

Key Takeaways from NDR

• Capacity Growth: The construction of major production bases for FBR-based granular silicon is progressing well.
• Cost Reduction: The unit cost of polysilicon is expected to decline due to the higher contribution of granular silicon, which has significantly lower electricity consumption.
• Stake Reduction in GNE (451 HK): GCL's stake in GNE will be reduced from 44.44% to 7.44% following the distribution of GNE shares to shareholders in specie, which will reduce financial burden and support potential A-share listing.

Capacity and Production

• By end-2022E, consolidated granular capacity is expected to reach 260kt, with attributable capacity at 175kt.
• Consolidated granular production in 2022E is expected to reach 75kt, with attributable production at 60kt.
• Consolidated rod silicon output in 2022E is expected to be 105kt, with attributable output at 76kt.

Cost and Margin

• 1H22 Performance: GCL achieved a unit gross margin of ~RMB155/kg for granular silicon, compared to ~RMB109/kg for rod silicon.
• Unit Cost: Estimated unit cost of granular silicon in 1H22 was close to ~RMB44/kg.
• Electricity Consumption: GCL reduced comprehensive electricity consumption to 13.6 kWh/kg in 1H22, down from 14.8 kWh/kg in 2021. This is much lower than the 55-60 kWh/kg required by rod silicon.
• Power Cost Advantage: GCL's granular capacity in Leshan and Baotou benefits from lower power tariffs (RMB0.3/kWh and RMB0.26/kWh respectively), even if Inner Mongolia's tariff rises to RMB0.45/kWh, the cost structure of granular silicon remains less sensitive to electricity costs.

Perovskite Technology

• GCL has established 100MW of solar cells using perovskite technology.
• Conversion efficiency is expected to improve from 14% to 16% in the current period and reach 18% in 2023E.
• However, this is still below the efficiency of PERC, TOPCon, and HJT technologies.
• At the laboratory stage, conversion efficiency has not exceeded 26%, while the theoretical maximum is 31.3%.
• GCL has not yet decided on the specific perovskite technology to develop, including raw materials and cell structure.
• The analyst believes it will take years before perovskite technology has a real market impact.

Stock Information

• Current Price: HK$2.76
• Market Cap: HK$74,819 million
• Avg 3 mths t/o: HK$838 million
• 52w High/Low: HK$3.99 / HK$1.98
• Total Issued Shares: 27,109 million

Shareholding Structure

• Zhu Gongshan: 23.5%
• Others: 76.5%

Share Performance

CMBIGM Ratings

• BUY: Potential return of over 15% over next 12 months
• HOLD: Potential return of +15% to -10% over next 12 months
• SELL: Potential loss of over 10% over next 12 months
• NOT RATED: Not rated by CMBIGM

Important Disclosures

• The report contains general information and is not tailored to individual investors.
• There are risks involved in investing in any securities.
• CMBIGM does not provide investment advice and recommends consulting a professional financial advisor.
• The information is subject to change and not guaranteed.
• CMBIGM may have conflicts of interest and is not liable for any losses incurred from reliance on this report.

Compliance Information

• Hong Kong: CMB International Global Markets Limited is a subsidiary of CMB International Capital Corporation Limited.
• United Kingdom: Report is provided only to certain categories of investors.
• United States: CMBIGM is not a registered broker-dealer in the US and the report is intended for major US institutional investors.
• Singapore: Report is distributed by CMBISG, an exempt financial adviser in Singapore.