Chinese photovoltaic concept stocks staged a sharp rally despite a broader market pullback, driven by a trio of positive catalysts: a newly released government energy-saving supervision directive targeting the polysilicon industry, record-breaking domestic PV power generation data, and a stellar earnings forecast from major companies in the industry.
On August 1, PV concept stocks rallied across the board in the A-share market, with Shenzhen SC New Energy Technology Corporation (300724.SZ) and Guangdong Wenke Green Technology Corp Ltd (002775.SZ) hit limit-up, while Sungrow Power Supply (300274.SZ), Xinjiang Daqo New Energy (688303.SH), and Zhejiang Jingsheng Mechanical & Electrical (300316.SH) also saw significant gains.
Analysts say that the strength in the PV sector was mainly driven by three key news catalysts: the Ministry of Industry and Information Technology (MIIT) issued the 2025 special energy-saving supervision task list for the polysilicon industry on Friday; China’s PV power generation saw substantial growth in the first half of the year; and Shenzhen SC New Energy Technology Corporation released an earnings report last night that was notably impressive.
On August 1, the MIIT issued the Notice on the 2025 Special Energy-Saving Supervision Task List for the Polysilicon Industry, which instructs local industry and information departments to promptly organize and implement the work in accordance with the Notice on Carrying Out the 2025 Industrial Energy-Saving Supervision Work, and to submit the results to MIIT by September 30, 2025.
According to the notice, the special energy-saving supervision list covers 41 companies in regions such as Inner Mongolia, Sichuan, Yunnan, and Qinghai, including Sichuan Yongxiang New Energy Co., Ltd. (Inner Mongolia branch), Inner Mongolia Daqo New Energy Co., Ltd., Leshan GCL New Energy Technology Co., Ltd., Yunnan Tongwei High Purity Silicon Co., Ltd., and Xinjiang Central Hoshine Silicon Industry Co., Ltd.
In addition, on July 31, Shenzhen SC New Energy Technology issued a performance forecast, estimating that net profit attributable to shareholders in the first half of 2025 will reach between 1.7 billion and 1.96 billion yuan, a year-on-year increase of 38.65% to 59.85%, mainly driven by the continuous conversion of existing orders into revenue.
Shenzhen SC New Energy Technology is engaged in the R&D, production, and sales of solar cell manufacturing equipment. It has deployed high-efficiency and ultra-high-efficiency solar cell technologies such as TOPCon, HJT, XBC, perovskite, and tandem perovskite cells. In 2024, the company achieved operating revenue of 18.887 billion yuan, a year-on-year increase of 116.26%, and net profit attributable to shareholders of 2.764 billion yuan, up 69.18%.
According to the latest data from the National Energy Administration, in the first half of this year, China added 212 GW of new grid-connected PV capacity, and among this, centralized PV accounted for about 100 GW, while distributed PV reached 113 GW.
By the end of June 2025, China’s total installed PV power generation capacity had reached around 1.1 TW, a year-on-year increase of 54.1%, with centralized PV accounting for 606 GW and distributed PV 493 GW.
In the first half, China’s PV power generation reached 559.1 billion kWh, a year-on-year increase of 42.9%, with an average utilization rate of 94% nationwide.
In addition, since July, the authorities have take several actions to crack down on “involution-style” competition.
HSBC Jintrust Fund said that in the short term, effective “anti-involution” measures have driven a recovery in industry chain prices, and as these policies advance, they help restore industry confidence and may accelerate the optimization of the competitive landscape and profitability of the PV sector.
In the medium to long term, with growing global demand for clean energy, the long-term prospects for the PV industry remain broad. On the demand side, future PV installations are expected to grow, and ample supply ensures support for subsequent demand, it said.
Central China Securities noted that comprehensively addressing low-price competitions in the PV sector and promoting the elimination of outdated production capacity will be a key policy theme for the second half of this year and into next year, and measures involving price control, corporate mergers and acquisitions, higher entry thresholds, and elevated product standards will continue to be implemented.
Currently, the valuation of the PV sector is at a historical low, and as production capacity is gradually cleared out, supply and demand in the industry will gradually improve, it noted.
CITIC Securities said that “anti-involution” has now risen to a national strategic level, and as a sector plagued by homogenized and low-price competition, PV is at the core of this round of anti-involution efforts.
Under a market-oriented approach, as the industry returns to orderly and standardized competition, and with the gradual implementation of potential supply-side reform policies, the PV industry chain is expected to see a reasonable price rebound and profitability recovery, which will help solidify and improve industry fundamentals, it said.
At the same time, technological innovation remains the fundamental path for PV to break out of homogenized competition, and companies with product differentiation, high-end markets, and strong branding in manufacturing are expected to see earlier performance reversals and long-term growth, it added.