The Zhitong Finance app learned that Huafu Securities published a research report saying that it is probably more of a rebound rather than a reversal (but don't give up on the chance of a rebound). Mainly, the core suppression factors of oversupply in various sectors have not yet been resolved, but when the sector is over falling and is extremely pessimistic, the rebound brought about by improvements in marginal factors has participation value (it is expected that the Fed's interest rate cut plus lower terminal loan interest rates will continue to be catalyzed). It is recommended to focus on the household storage microfinance sector, which benefits from the gradual removal of overseas inventories and the rise in short-term natural gas futures prices, and is supported by volume growth elasticity and unit profit support (driven by product structure upgrades).

Huafu Securities's views are as follows:

Why is there a sharp rise?

1) Interest rates on US terminal loans have fallen by more than 0.5%: According to data from the Mortgage Bankers Association on 12.20, interest rates on various types of medium- and long-term loans in the US have been falling for 6 weeks, down 0.6%-0.8% from the highest point. The decline in actual terminal loan interest rates is one of the core factors in the increase in the IRR of overseas optical storage. Combined with the falling cost of components, batteries, etc., the cost of superimposed components, batteries, etc., and a nonlinear increase in overseas solar storage demand can be expected!

2) Inverter export data improved month-on-month: November inverter exports reached 560 million US dollars, +1% over the previous year, achieving positive growth; of these, Zhejiang exports (represented by Germany and Jinlang) were 99 million US dollars, +22.6% over the previous month; in addition, exports to Brazil, India, South Africa, and Japan achieved positive month-on-month growth.

If it can be reversed, what do we have to wait for?

1) Supply-side reforms: The core factor currently limiting the sector comes from the supply side, not the demand side (but don't give up on the demand side of marginal improvements). The PV supply-side symposium held by the Ministry of Industry and Information Technology on November 13 can be used as a signal. If there are substantial actions related to supply-side reforms in the future, the problem of suppressing the recovery in sector valuations may be solved.

2) New technology leadership: The new round of technology is leading the way in the future sector. The industry will inevitably experience a painful period of backward production capacity, thus ushering in a happy period of high-quality production capacity renewal. The core recommendation focuses on enterprises with absolute advantages in technology and capital, as well as equipment and auxiliary materials that benefit from relevant technology.

Which ones do you prefer for a rebound?

1) Microinverse household storage sector: Natural gas catalyzes stock prices. It is recommended to focus on Deye Shares (605117.SH) (which has a fundamental improvement logic, South African household storage inventory expectations are bottoming out, etc.), Goodway (688390.SH), Hemai Shares (), Yuneng Technology (), etc. 688032.SH 688348.SH

2) High quantitative flexibility and resilient unit profit (product structure upgrade): It is recommended to focus on Yubang New Materials (301266.SZ) (increase in the share of SMBB+ low temperature welding tape), Dicke (300842.SZ) (increase in the proportion of special silver paste for TopCon and LECO), Juhe Materials (688503.SH) (increase in the proportion of TopCon+HJT+ silver powder supply), CITIC (688408.SH) (increase in the proportion of tracking brackets), etc.

Risk warning: Overseas interest rates fell short of expectations; global demand for optical storage fell short of expectations; industrial chain prices fell beyond expectations, etc.