Fiberglass electronic gauze factory starts "reprice" and analysis says there may still be a possibility of subsequent increases

Fiberglass electronic gauze factory began to implement the "reprice" strategy, that is, to adjust the price of products to cope with long-term losses and rising costs. Market analysts believe that prices may continue to rise due to rising costs and improved demand expectations.

 

Fiberglass electronic gauze factory began to implement the "reprice" strategy, that is, to adjust the price of products to cope with long-term losses and rising costs. Market analysts believe that prices may continue to rise due to rising costs and improved demand expectations. This indicates that the fiberglass electronic gauze industry is gradually emerging from the downturn and is expected to recover.

 

 

Products have been in a price depression for a long time, and the impact of rising costs has made life difficult for many companies in the fiberglass industry. In the past few days, manufacturers including China Jushi (600176.SH) and Kingboard Laminated Panels (01888.HK) have successively made restorative price adjustments on electronic-grade fiberglass yarn and glass fiber cloth (referred to as electronic yarn/cloth) products. . Reporters from the Financial Associated Press learned from multiple interviews that the price increases of electronic yarn and electronic cloth are generally 600 yuan/ton and 0.2-0.3 yuan/meter. A person from the fiberglass enterprise bluntly told a reporter from the Financial Associated Press, "We can no longer continue to do business at a loss, so we are re-pricing, not increasing prices. Prices may go up in the future."

 

A reporter from the Associated Press called China Jushi Securities and learned that the company has made restorative adjustments to the prices of related products since April 15. Electronic cloth has been increased by 0.2 to 0.3 yuan, and electronic yarn has been increased by 400 to 600 yuan. According to the source, "Because some customers are locked in, about 30% (customers) will raise prices this month, and 90% will adjust to this price range next month."

 

It is understood that many industry manufacturers such as Taishan fiberglass, Kingboard laminated board, Henan Guangyuan New Materials Co., Ltd. have recently issued price adjustment notices, increasing the price of G75 yarn to 600 yuan per ton, and the price of 7628 electronic cloth to 0.2-0.2 yuan per meter. 0.3 yuan. Zhuochuang Information said that at present, the mainstream price of electronic yarn G75 is expected to be no less than 8,000 yuan/ton after the reprice, and the price of electronic cloth 7628 after the reprice is between 3.4-3.6 yuan/meter.

 

"This round of price increases is affected by rising cost-end prices and long-term profit losses, and various kiln factories have a high intention to increase prices. In addition, the market has good demand expectations for consumer electronics and other fields during the year, and prices can be increased appropriately in a phased manner. Stimulating the release of some demand orders," Liu Yang, an analyst at Zhuochuang Information, told a reporter from the Financial Associated Press.

 

"Re-price" may be a helpless move. Kingboard laminate sales channel personnel said, "Many raw materials have increased now." Multiple price adjustment notices obtained by the reporter showed that many manufacturers have been affected by the price of electronic gauze/cloth products. It continues to operate at a low level, and products with relevant specifications are in a state of loss.

 

In addition, according to disclosed annual reports and performance forecasts, China Jushi, Sinoma Technology (002080.SZ), Shandong Fiberglass (605006.SH), International Composites (301526.SZ), Changhai Shares (300196.SZ) and other companies In 2023, net profits will decline to varying degrees year-on-year. The main factors are the "low price" and "significant drop in sales price" of fiberglass products.

 

Under this situation, the gross profit margin of China Jushi's "glass fiber and its products" in 2023 dropped by 13.97% year-on-year to 27.57%. Changhai Co., Ltd. stated in its annual performance forecast that the decline in the sales price of fiberglass products caused its sales and gross profit margin to decline year-on-year.

 

A reporter from Cailian News also noticed that Sinoma Technology's glass fiber and its products will achieve a net profit of 1 billion yuan in 2023, a decrease of 1.81 billion yuan from 2.81 billion yuan in the same period in 2022. The company said, "The impact of the decline in gross profit margin on net profit Larger. "Affected by the decline in product prices, the gross profit margin of Sinoma Technology's fiberglass products in 2023 fell by 9.80% year-on-year to 22.62%.

 

In fact, "from 2022Q1 to the present, the electronic cloth industry has suffered large-scale losses for a long time." Minsheng Securities analysis mentioned that electronic cloth was repriced twice in October 2022 and September 2023, but the final implementation was average.

 

So, after the "reprice", will the price of fiberglass products return to normal levels? A person from a listed company told reporters, "It's too far. It won't be able to return in the short term. The current price is still at a low level, and the impact on gross profit margin is relatively limited."

 

"Reprice" has become the key to saving performance for major companies. Sinoma Technology responded to investors in Huayi yesterday that the prices of some of the company's fiberglass products have also rebounded recently. In addition, China Jushi has repriced some roving products at the end of March. The company said, "Judging from the current implementation, the price has been implemented well." Regarding the reprice of electronic fabrics, Yang Guoming, general manager of China Jushi, said that it will The company has a positive impact on further improving profitability and achieving sustainable development.

 

Looking forward to the market outlook for fiberglass cloth, Liu Yang believes that the current market demand is relatively slow to release, and under the support of cost pressure, short-term prices may stabilize after rising; in the medium and long term, as demand gradually recovers, prices are still expected to increase to some extent.

 

It is worth noting that glass fiber cloth is one of the main raw materials for the production of copper-clad laminates. Under the background of "reprice", relevant downstream companies have also responded.

 

As an investor, the reporter learned from the securities department of Shengyi Technology (600183.SH), a copper-clad laminate manufacturer, that the three main materials (copper-clad laminate) "copper foil, fiberglass cloth, and epoxy resin" account for about 70% of the cost. % to about 80%, of which fiberglass cloth accounts for about 25%. The company will adopt corresponding strategies to respond based on specific needs, operations, etc.

 

A staff member of the securities department of Shenghong Technology (300476.SZ) said that in fact, we do not purchase fiberglass cloth, but we purchase copper-clad laminates. In addition, fiberglass cloth is also used on PP glue, so its proportion is very low and there is no direct Impact.

 

The final implementation effect of electronic yarn/cloth reprice and its impact on copper-clad laminate manufacturers still need to be tested in the follow-up time.