The solar industry is entering a sustained capacity-clearing cycle in 2026, with competitive dynamics and supply chain ecosystems expected to improve, leading to gradual earnings recovery for existing players. Public funds' allocation to the solar sector remains low, but undervaluation and improving supply-demand fundamentals may attract incremental capital inflows. Investors are advised to focus on leading companies in niche segments, including energy storage inverters, polysilicon, solar glass, and integrated module manufacturers. The sector maintains an "Outperform" rating.
Key insights from Central China Securities: - **Market Trends**: In 2025, renewable power’s full entry into market-driven trading spurred temporary installation surges. Domestic solar installations reached 240.27GW in the first three quarters, up 64.73% YoY, though post-surge demand normalized. Weak growth in traditional欧美 markets contrasts with robust demand in亚太 and Africa, where module imports surged. - **Policy Impact**: Anti-internal competition policies and widespread industry losses are forcing产能退出, with sector earnings bottoming out. Valuations are gradually recovering. - **2026 Outlook**: Grid absorption capacity remains a critical constraint. Utility-scale projects reliant on mega-bases will drive installations, while Policy Document 136 reshapes project economics, favoring solar-storage integration and self-consumption. Distributed solar growth slows. - **Global Markets**: U.S. installations face headwinds from expiring tax credits, while aging grids and subsidy phase-outs limit European growth.亚太’s rigid power demand and the Middle East’s energy transition offer emerging opportunities.
**Segment Highlights**: 1. **Energy Storage Inverters**: - Rising global储能 demand benefits inverter makers, critical for DC-AC conversion in储能 systems. - China’s 2025–2027储能 plan targets 180GW of new储能 capacity by 2027, driving growth for leaders with brand/tech edges.
2. **Polysilicon**: - Stricter energy standards force subpar producers to exit. Mergers among leaders may consolidate产能. - Prices have rebounded past breakeven; focus on scaled, low-cost players.
3. **Solar Glass**: -产能优化淘汰s smaller furnaces (<1,000T/D). Demand growth slows in 2026, but thinning/multi-functional glass may offset this. - Price recovery likely; prioritize cost-competitive leaders.
4. **Integrated Module Makers**: - Anti-internal competition policies (legal + regulatory +自律) stabilize supply. - Leaders are pivoting to储能 (e.g., commercial/large-scale储能 plants) for new growth.
**Risks**: Slower global installations; trade disputes;产能过剩; policy delays; prolonged sector downturn.
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