UBS raises XINYI SOLAR's target price to 4.1 yuan and continues to recommend "buy," expecting solar glass demand to bottom out this year

According to a research report by UBS, XINYI SOLAR (00968.HK) is expected to see a 16.2% year-on-year decline in net profit to RMB 845 million in 2025, due to weak demand leading to poor sales and profitability, as well as a loss of RMB 2.3 billion related to polysilicon and solar glass. Excluding impairment losses, management estimates last year's core net profit at approximately RMB 2.2 billion.

The bank has lowered its earnings per share forecasts for 2026 and 2027 by 8% and 9%, respectively, to reflect short-term margin pressures and weak sales. Since long-term profit forecasts remain unchanged, the target price has slightly increased from HKD 4 to HKD 4.1, maintaining a "Buy" rating, as the bank believes that the supply and demand situation for solar glass is likely to bottom out and recover starting in 2026, and the increasing proportion of overseas shipments will help offset the impact of domestic margin contraction