Analysis of the Impact of Polysilicon Anti-Monopoly Regulation on Valuations of Photovoltaic Upstream Enterprises

Based on the latest collected market data and industry information, I hereby provide you with an in-depth analysis report on

On January 6, 2026, the State Administration for Market Regulation (SAMR) held talks with the China Photovoltaic Industry Association and major polysilicon enterprises including Tongwei Co., Ltd., GCL Technology, Daqo New Energy, Xinte Energy, Asia Silicon Industry, and East Hope. The meeting notified the monopoly risks in the polysilicon industry and put forward clear rectification requirements for the enterprises [1][2]. Affected by this,

In December 2025, the polysilicon capacity integration and acquisition platform “Beijing Guanghe Qiancheng Technology Co., Ltd.” was officially established, marking the implementation of the long-gestating capacity integration mechanism in the photovoltaic industry [3]:

• Current Stock Price: RMB 21.66 (January 8, 2026) [4]
• Price-to-Book Ratio (P/B): 2.18x
• Price-to-Earnings Ratio (P/E): -11.43x (in loss)
• ROE: -18.28%
• Gross Profit Margin: -10.72%
• 12-Month Target Price: RMB 23.11 (analyst consensus) [4]

• Current Stock Price: RMB 28.34 [5]
• Price-to-Book Ratio (P/B): 1.55x
• Price-to-Earnings Ratio (P/E): -22.47x
• ROE: -6.82%
• Gross Profit Margin: -65.62%
• Q3 2025 performance exceeded expectations, with EPS of US$0.03, beating estimates by 120%

The impact of the regulatory talk event on valuations is mainly reflected in the following aspects:

1. Reassessment of Price Expectations
   • The polysilicon futures price surged from a low of RMB 31,000/ton in July 2025 to a high of RMB 63,000/ton in December 2025, representing an increase of over 85% [6]
   • After the regulatory news, the price fell rapidly to the range of RMB 45,000-50,000/ton
   • The industry expects the price may return to a
     marginal cost pricing model
     (approximately RMB 45,000/ton)

2. Increased Uncertainty in Profit Model
   • After the strengthening of anti-monopoly regulation, the model of enterprises stabilizing prices through “capacity coordination” faces compliance risks
   • Under the framework of the Price Law, selling below cost is prohibited, but price manipulation is also restricted
   • It is expected that industrial chain profits will be redistributed, and the polysilicon segment will need to cede part of its profit space [7]

3. Market Sentiment and Capital Side
   • JPMorgan assigned an “Overweight” rating to GCL Technology (03800.HK) and Daqo New Energy (DQ.US) [8]
   • It believes that industry integration driven by anti-involution policies in 2026 will bring positive impacts
   • However, short-term regulatory uncertainty has led to rising capital risk aversion

According to market research institutions, there are four main scenarios for capacity clearance [7]:

• Capacity Storage Scale: Approximately 1.5 million tons
• Time Window: Q1 to Q2 2026
• Price Impact: Supported at RMB 45,000-55,000/ton
• Features: Gradual de-capacity, relatively small impact on the market

• Capacity Storage Scale: Approximately 1.5 million tons
• Time Window: Q2 to Q3 2026
• Price Impact: Stable operation at RMB 50,000-60,000/ton
• Features: Rapid de-capacity, but requires substantial capital support

• Capacity Storage Scale: Approximately 2.23 million tons
• Time Window: Q3 to Q4 2026
• Price Impact: RMB 55,000-65,000/ton, supply and demand are close to balance
• Features: Achieves full balance of supply and demand, but with high implementation difficulty

• Form: Natural elimination through market competition
• Time Window: Q1 to Q2 2027
• Price Impact: Wide fluctuation in the range of RMB 40,000-70,000/ton
• Features: Long and painful process, expected to last 2-3 years

Based on the latest industry research data [9]:

• The oversupply pressure will be the greatest in the first half of 2026 (domestic installation off-season + overseas project approval period)
• In the second half of the year, with the launch of emerging market projects, the surplus margin may be slightly relieved
• Global photovoltaic installation is expected to record negative growth for the first time in 2026 (-10% to -2%), putting pressure on the demand side

• Short-Term (1-3 months):
  Reduce holdings in the polysilicon sector to avoid regulatory uncertainty risks
• Medium-Term (3-6 months):
  Accumulate positions in leading enterprises on dips, and pay attention to the progress of capacity integration
• Long-Term (6-12 months):
  After the industry structure stabilizes, there will be valuation recovery opportunities for high-quality enterprises

1. Policy Variables:
   Implementation of regulatory rectification requirements, execution strength of the storage platform
2. Price Signals:
   Polysilicon futures price trend, relationship between spot price and marginal cost
3. Capacity Dynamics:
   Production reduction plans of leading enterprises, exit progress of second- and third-tier enterprises
4. Demand Changes:
   Domestic photovoltaic installation data, export situation in overseas markets

1. Valuation Impact:
   In the short term, anti-monopoly regulation has obviously suppressed the valuations of photovoltaic upstream enterprises, with sharp pullbacks in both stock prices and futures prices. In the long term, industry integration will benefit leading enterprises with cost advantages.

2. Clearance Timeline:
   It is expected that initial market-oriented capacity clearance will be achieved from Q4 2026 to Q1 2027
   , forming a new pattern centered on marginal cost pricing.

3. Investment Strategy:
   It is recommended to pay attention to the relative advantages of leading enterprises such as Tongwei Co., Ltd. and Daqo New Energy in industry integration, while closely tracking regulatory policy trends and capacity clearance progress.

[1] SAMR Notifies Monopoly Risks in Polysilicon Industry

[2] New Progress in Polysilicon “Anti-Involution”! Storage Platform Established

[3] China’s Photovoltaic Industry Deepens “Anti-Involution”

[4] Tongwei Co., Ltd. Stock Quote

[5] Latest News on Daqo New Energy

[6] Frenzy in Polysilicon Futures

[7] 2026 Polysilicon Strategy: Demand Under Pressure but “Anti-Involution” Progresses Actively

[8] JPMorgan: Industry Integration Driven by Anti-Involution Policies Expected in 2026

[9] 2026 Photovoltaic Installation Outlook: How Much Demand for Polysilicon?

[10] Photovoltaic Industry in 2026: Three Missions of Anti-Involution, Price Hike, and Clearance

Report Generation Time: January 8, 2026
Data Sources: Jinling AI Financial Analysis Platform, Brokerage Research Reports, Public Market Information