The Zhitong Finance App learned that Huafu Securities released a research report saying that according to SMM, due to the increase in the cost of photovoltaic-grade EVA particles, mainstream manufacturers are willing to raise the prices of EVA film and EPE film, and companies with related intentions exceed 80% of the total number of film companies in the market. At the same time, according to the Silicon Industry Branch, the current March module production schedule is improving markedly month-on-month, and significant improvements on the demand side are expected to lead to a clear implementation of plastic film price increases. Looking ahead, the bank believes that from the demand side, demand from mainstream overseas markets in Q2 is expected to gradually be released (seasonal effect+overseas interest rate cut cycle is getting closer). Overall, there is a very high probability that it will be better than Q1. There is still a possibility that plastic film will continue to be favorable, and the overall profit of Q2 film is expected to continue to rise month-on-month.

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Huafu Securities's views are as follows:

The profit of adhesive film is expected to improve in March, and the overall Q1 profit improvement can be expected in combination with possible particle inventory earnings:

1) The rebound in particle prices is expected to contribute to inventory revenue: PV-grade particle prices bottomed out before and after the holiday season. Since film manufacturers generally have 1-2 months of particle inventory, film manufacturers' particle inventory costs are basically at a low level under the 23Q4 particle price reduction channel, so during the particle price increase channel, film manufacturers will benefit from price increases to generate inventory revenue.

2) Benefiting from the share of adhesive film shipments in March, the monthly profit improvement due to price increases is expected to drive the overall month-on-month improvement in Q1: Judging from the overall Q1 component schedule, the March production schedule is expected to improve significantly month-on-month (downstream production schedule is poor in February due to the Spring Festival holiday), so the March order volume is expected to improve simultaneously, and volume profit is expected to rise sharply in March, thus driving the overall profit improvement in Q1 from month to month!

Looking forward to the next steps:

1) On the cost side, the new supply of EVA particles in 24 years is relatively limited. If overseas demand continues to improve sequentially, there is still a possibility that particles will rise: from the supply side, there is still a possibility that there will be few new PV-grade EVA devices within 24 years, and considering the impact of equipment maintenance in 24 years, overall production growth is limited. If overseas demand continues to improve in the future, particle prices may still rise;

2) There is still a month-on-month increase in Q2 film profit: From the demand side, demand from mainstream overseas markets in Q2 is expected to gradually be released (seasonal effect+overseas interest rate cut cycle is getting closer). Overall, there is a high probability that it will be better than Q1. There is still a possibility that plastic film will continue to be favorable, and the overall profit of Q2 film is expected to continue to rise month-on-month!

Risk warning: Global demand for PV installations falls short of expectations, product price increases fall short of expectations, and raw material prices fluctuate greatly.