Longi Green Energy (601012.CH): Operational Efficiency Drives Significant Loss Reduction; BC Technology Accelerates Market Penetration

Date: August 23, 2025
Sector: Renewable Energy / Photovoltaics
Analyst: Institutional Research Team
Rating: BUY
Current Price: CNY 16.52
Target Price: Implied Upside based on 2026/2027 Recovery Trajectory

Executive Summary

Longi Green Energy Technology Co., Ltd. ("Longi" or the "Company") released its interim financial results for the first half of 2025 on August 22, 2025. The report highlights a pivotal turning point in the Company’s operational trajectory amidst a challenging industry backdrop. While top-line revenue contracted due to prevailing low prices across the photovoltaic (PV) supply chain, the Company demonstrated remarkable resilience through aggressive cost control, operational efficiency improvements, and strategic product mix optimization.

Key Financial Highlights for 1H 2025:
* Revenue: CNY 32.8 billion, representing a year-over-year (YoY) decline of 15%.
* Net Profit Attributable to Shareholders: A net loss of CNY 2.569 billion. However, this represents a significant reduction in losses compared to the same period in the previous year.
* Q2 2025 Momentum: Second-quarter revenue reached CNY 19.2 billion (YoY -8%, Quarter-over-Quarter [QoQ] +40%). Q2 net loss narrowed to CNY 1.133 billion, a substantial improvement from the CNY 2.893 billion loss in Q2 2024 and the CNY 1.436 billion loss in Q1 2025.

The core investment thesis for Longi has shifted from pure scale expansion to technology-led differentiation and financial fortitude. The Company’s Back Contact (BC) technology, specifically the HPBC 2.0 platform, is accelerating its market penetration, with shipments reaching approximately 4GW in 1H 2025. Concurrently, the broader PV industry is witnessing early signs of stabilization driven by policy-induced "anti-involution" measures, including recent multi-ministry consultations aimed at curbing irrational price competition.

We maintain our BUY rating on Longi Green Energy. Our confidence is underpinned by three primary factors:
1. Operational Turnaround: Significant narrowing of losses driven by a 37% YoY reduction in selling expenses and a 23% YoY reduction in administrative expenses, alongside reduced asset impairments.
2. Technological Moat: The rapid ramp-up of HPBC 2.0 capacity, achieving a 97% mass production yield and 24.8% module conversion efficiency, positions Longi to capture premium margins as the market shifts toward high-efficiency products.
3. Financial Resilience: With nearly CNY 50 billion in cash on hand and a manageable debt profile (interest-bearing debt ratio of 21.45%), Longi is uniquely positioned to survive the current industry consolidation phase and emerge as a dominant leader in the next cycle.

We have adjusted our earnings forecasts for 2025-2027 to reflect the ongoing price pressures and the gradual recovery timeline. We now estimate net profits attributable to shareholders of CNY -3.07 billion for 2025, CNY 3.93 billion for 2026, and CNY 6.08 billion for 2027. The anticipated return to profitability in 2026, driven by BC product premiumization and industry supply-demand rebalancing, offers a compelling risk-reward profile for long-term institutional investors.

Key Takeaways

1. Financial Performance: Deep Dive into the Loss Narrowing Trend

The 1H 2025 results indicate that while the top-line pressure persists, the bottom-line deterioration has been effectively arrested. The Company’s ability to reduce losses despite a 15% revenue contraction underscores the effectiveness of its internal restructuring and cost-management initiatives.

Revenue and Profitability Analysis

Note: Specific 1H 2024 absolute loss figures were not explicitly detailed in the summary text but described as significantly higher than 1H 2025. Q2 2024 loss was CNY 2.893 billion.

Q2 Sequential Improvement:
The second quarter marked a critical inflection point. Revenue grew 40% QoQ, driven by seasonal demand pickup and installation rushes in key markets. More importantly, the gross margin repaired by 3.4 percentage points QoQ to -0.8%. While still negative, this trend indicates that the worst of the pricing collapse may be behind us. The reduction in unit losses for both silicon wafers and battery/modules suggests that the Company’s cost reductions are outpacing the decline in average selling prices (ASPs).

Expense Control as a Primary Driver:
A major contributor to the narrowed loss was the drastic reduction in operating expenses.
* Selling Expenses: Decreased by 37% YoY. This reflects a more disciplined approach to market expansion, focusing on high-value customers and regions rather than volume-at-any-cost strategies.
* Administrative Expenses: Decreased by 23% YoY. This indicates successful organizational streamlining and improved operational leverage.
* Asset Impairment: Significantly reduced compared to the prior year. In 2024, the industry faced massive write-downs due to obsolete PERC capacity and inventory devaluation. In 1H 2025, the impairment burden has lightened, suggesting that the Company has largely digested the legacy inventory and asset value adjustments.

2. Operational Metrics: Volume Growth Amidst Price Deflation

Despite the revenue decline, physical shipment volumes increased, demonstrating Longi’s ability to maintain market share even in a downturn.

• Silicon Wafer Shipments: 52.08 GW in 1H 2025, a 17% YoY increase.
  • External Sales: 24.72 GW.
  • This growth highlights Longi’s continued dominance in the wafer segment. The ability to increase shipments while prices fell below cost is a testament to its scale advantages and customer stickiness.
• Battery & Module Shipments: 41.85 GW total.
  • Module Shipments: 39.57 GW, a 23% YoY increase.
  • The divergence between wafer and module shipment growth rates suggests a strategic shift towards downstream integration, capturing more value add in the module segment where brand premium and technology differentiation (BC) are more pronounced.

3. Strategic Pivot: BC Technology Acceleration

The most significant strategic development in 1H 2025 is the rapid commercialization of Longi’s proprietary Back Contact (BC) technology, specifically the HPBC 2.0 platform. This move is designed to differentiate Longi’s products from the commoditized TOPCon offerings that have flooded the market, thereby restoring pricing power and margins.

HPBC 2.0 Progress and Metrics

Capacity Expansion Timeline:
* Existing: 24 GW of owned HPBC 2.0 battery capacity already in place.
* Ramping Up: Facilities in Xixian and Tongchuan are gradually commencing production.
* Under Construction: The Weibei project is progressing steadily.
* Collaborative Capacity: Joint ventures and collaborations with partners such as Yingfa Derui and Pingmei Longji are beginning to contribute output.

This aggressive capacity rollout ensures that Longi will have sufficient supply to meet the growing demand for high-efficiency modules. The target of having over 60% of high-efficiency battery capacity dedicated to HPBC 2.0 by the end of 2025 is a bold statement of intent. It signals that Longi is betting heavily on BC technology becoming the mainstream standard for premium segments, moving away from the homogeneous competition in the P-type and standard N-type (TOPCon) markets.

Product Portfolio Enhancement:
* TaiRui Silicon Wafers: The Company’s high-quality "TaiRui" silicon wafers have achieved comprehensive market promotion. The penetration rate of TaiRui wafers in external N-type silicon sales reached 90% in 1H 2025. This indicates that customers are willing to pay a premium for Longi’s higher-quality wafers, which offer better yield and performance in cell manufacturing.
* Overseas Expansion: Capitalizing on the trend of decentralized battery manufacturing globally, Longi has successfully expanded its overseas silicon wafer customer base. Overseas silicon wafer sales volume surged by over 70% YoY in 1H 2025. This diversification reduces reliance on the domestic Chinese market, which is currently experiencing the fiercest price wars, and taps into regions where supply constraints may support better pricing.

4. Industry Dynamics: The "Anti-Involution" Catalyst

The Chinese PV industry has been plagued by "involution" (neijuan)—a term describing intense, often irrational, internal competition leading to price wars that push prices below cash costs. However, 1H 2025 saw concerted efforts to reverse this trend.

Policy Intervention:
* June 2025 Onwards: The "anti-involution" campaign gained tangible traction. Prices for polysilicon, silicon wafers, and battery cells began to rise from their historic lows.
* August 19, 2025 Symposium: Six major government ministries jointly convened a symposium with leading PV manufacturers and power generation enterprises. This high-level intervention signals strong regulatory support for stabilizing the industry.
* Expected Outcome: The consensus is that component (module) prices will eventually transmit the upstream price increases. As prices rise to cover full costs (including depreciation and R&D), industry-wide profitability is expected to repair. For Longi, which has maintained a stronger balance sheet than many peers, this normalization of pricing is a direct catalyst for margin recovery.

5. Financial Health: A Fortress Balance Sheet

In an industry where liquidity crises are claiming weaker players, Longi’s financial position remains a key competitive advantage.

Liquidity and Solvency Metrics (as of Q2 2025):

Implication:
Low debt pressure allows Longi to:
1. Invest Counter-Cyclically: Continue investing in BC technology and next-gen R&D while competitors cut back.
2. Weather the Storm: Survive prolonged periods of negative cash flow without risking solvency.
3. Consolidate Market Share: Potentially acquire distressed assets or talent from failing competitors, further strengthening its long-term position.

Risks / Headwinds

While the outlook is improving, several risks remain that could impact the Company’s performance and the timing of its recovery.

1. International Trade Environment Deterioration

• Tariffs and Trade Barriers: The PV industry is highly globalized. Escalating trade tensions, particularly with the United States (UFLPA, AD/CVD duties) and the European Union (potential anti-subsidy investigations or carbon border adjustments), could restrict Longi’s access to high-margin overseas markets.
• Supply Chain Decoupling: Policies encouraging local manufacturing in the US and Europe (e.g., IRA in the US, Net Zero Industry Act in EU) may erode Longi’s export volumes if it cannot establish competitive local production facilities quickly enough.
• Impact: A reduction in overseas sales would force Longi to compete more intensely in the domestic market, potentially reigniting price wars and delaying margin recovery.

2. Technology R&D and Execution Risks

• BC Technology Adoption Rate: While HPBC 2.0 shows promise, the market’s willingness to pay a premium for BC modules over TOPCon is not guaranteed. If TOPCon efficiencies continue to improve rapidly and costs drop further, the differential advantage of BC may narrow.
• Yield and Cost Challenges: Scaling BC production to >60% of capacity requires flawless execution. Any delays in yield ramp-up or unexpected manufacturing complexities could lead to higher-than-expected costs, eroding the anticipated margin benefits.
• Next-Gen Disruption: The emergence of alternative technologies (e.g., HJT, Perovskite tandem cells) that offer superior performance or lower costs could render BC technology less competitive in the long run. Longi must continue to innovate to stay ahead.

3. Industry Demand Uncertainty

• Global Macro Economic Slowdown: High interest rates in key markets (US, Europe) can dampen demand for solar projects, particularly in the distributed generation (residential/commercial) segment where BC modules are most competitive.
• Grid Congestion and Policy Shifts: In some markets, grid infrastructure limitations are leading to curtailment issues, causing developers to slow down new installations. Changes in subsidy policies or feed-in tariffs in key growth markets could also negatively impact demand.
• Oversupply Persistence: Despite "anti-involution" efforts, the global PV supply chain still has significant excess capacity. If demand growth does not keep pace with capacity additions, prices may remain suppressed for longer than anticipated, delaying the return to profitability.

4. Financial and Accounting Risks

• Further Asset Impairments: While impairments decreased in 1H 2025, there is still a risk of additional write-downs if older PERC assets or inventory become completely obsolete or if market prices drop further unexpectedly.
• Currency Fluctuations: As a major exporter, Longi is exposed to foreign exchange risks. Significant fluctuations in the RMB against the USD, EUR, or other currencies could impact reported revenues and margins.

Rating / Sector Outlook

Sector Outlook: From Consolidation to Rationalization

The global photovoltaic sector is undergoing a painful but necessary consolidation phase. The era of unchecked capacity expansion is giving way to a focus on technological differentiation and financial sustainability.

Short-Term (6-12 Months):
* Price Stabilization: We expect prices to stabilize and gradually rise as policy interventions take effect and inefficient capacity exits the market. The "bottom" of the cycle appears to have been reached in 1H 2025.
* Profitability Pressure: Margins will remain under pressure in the near term as companies work through legacy inventory and adjust to new pricing norms. However, the rate of loss narrowing should accelerate for leading players like Longi.

Medium-Term (1-3 Years):
* Technology Differentiation: The market will bifurcate into standard efficiency (TOPCon) and high-efficiency (BC/HJT) segments. Leaders with proprietary high-efficiency technologies will command premium pricing and higher margins.
* Market Share Concentration: Financially weak players will exit, leading to increased market share for robust companies like Longi, JinkoSolar, and Trina Solar.
* Demand Growth: Long-term demand drivers (energy transition, electrification, AI data center power needs) remain intact. We expect global solar installations to continue growing at a double-digit CAGR, supporting revenue recovery for survivors.

Investment Rating: BUY

We maintain a BUY rating on Longi Green Energy.

Rationale:
1. Valuation Appeal: The stock is trading at historically low valuations relative to its long-term earnings potential. The current price largely reflects the pessimistic 2024-2025 loss environment, failing to fully price in the 2026-2027 recovery.
2. Leadership Position: Longi remains the global leader in wafer and module shipments. Its brand strength, distribution network, and vertical integration provide a durable competitive moat.
3. Technological Alpha: The successful rollout of HPBC 2.0 provides a clear path to margin expansion. As BC becomes a larger portion of the mix, Longi’s average selling price and gross margin should structurally improve.
4. Financial Safety: The strong balance sheet minimizes downside risk and provides optionality for strategic moves during the consolidation phase.

Target Price Considerations:
While a specific numeric target price is not explicitly recalculated in this text, the implied valuation based on 2026/2027 earnings suggests significant upside.
* 2026E EPS: CNY 0.52
* 2027E EPS: CNY 0.80
* Applying a conservative forward P/E multiple (e.g., 15x-20x) to the 2027 earnings power implies a fair value range well above the current price of CNY 16.52, offering substantial upside potential for patient capital.

Investment View

Core Investment Logic

1. The "Turnaround" Play: Operational Efficiency Driving Alpha
Longi is no longer just a beta play on solar demand; it is becoming an alpha story driven by operational excellence. The 1H 2025 results prove that management can actively manage through a downturn. The 37% cut in selling expenses and 23% cut in admin expenses are not one-off events but represent a structural shift in the Company’s cost base. This leaner operating model means that when revenues recover, operating leverage will drive disproportionate profit growth. Investors should view the current losses as transient, caused by extraordinary market conditions, while the underlying operational improvements are permanent.

2. The "Technology Premium" Thesis: BC as the New Standard
The PV industry is transitioning from a commodity market to a differentiated technology market. Longi’s bet on BC technology is strategically sound.
* Why BC? BC modules offer superior aesthetics (no front grid lines) and higher efficiency, making them ideal for the high-margin distributed generation (rooftop) market. As land constraints become more relevant and consumers become more discerning, the demand for premium modules will grow.
* Execution Risk Mitigated: The 97% yield and 24.8% efficiency metrics confirm that Longi has solved the manufacturing challenges associated with BC. The rapid ramp-up to 4GW shipments and the plan for >60% BC capacity by end-2025 demonstrate execution capability.
* Margin Expansion: As BC modules replace standard TOPCon in Longi’s sales mix, the average gross margin should expand. We model this transition driving the return to profitability in 2026.

3. The "Survivor’s Dividend": Financial Strength as a Moat
In cyclical industries, the biggest winner is often the last man standing. Longi’s CNY 50 billion cash pile and low interest-bearing debt ratio (21.45%) are critical assets.
* Competitive Advantage: Many competitors are facing liquidity crunches, forcing them to sell assets at fire-sale prices or cut R&D. Longi can continue to invest in R&D and maintain customer service levels, strengthening its brand loyalty.
* M&A Optionality: Longi is well-positioned to acquire distressed technologies, patents, or even manufacturing facilities from bankrupt competitors, further consolidating its leadership.
* Dividend Potential: Once profitability returns in 2026/2027, Longi’s strong cash flow generation could support a reinstatement of attractive dividends, appealing to income-focused institutional investors.

Detailed Financial Analysis and Forecast Adjustments

Revenue Forecast: A U-Shaped Recovery

We project a U-shaped revenue trajectory for Longi over the next three years.

• 2025E (CNY 64.48 billion, -21.9% YoY):

  • Revenue declines due to lower average selling prices (ASPs) across the board. Although shipment volumes may remain stable or grow slightly, the price deflation in silicon wafers and modules dominates the top line.
  • Q2 2025’s sequential growth (+40% QoQ) suggests that the volume momentum is building, but full-year revenue will still be impacted by the weak 1H performance.

• 2026E (CNY 81.73 billion, +26.8% YoY):

  • Revenue rebounds strongly. This is driven by two factors:
    1. Price Normalization: As the "anti-involution" policies take hold and excess capacity clears, ASPs stabilize and begin to rise.
    2. Volume Growth: Global solar demand continues to grow, and Longi’s expanded BC capacity allows it to capture a larger share of the high-value market.
  • The shift in product mix towards higher-priced BC modules also contributes to revenue growth.

• 2027E (CNY 91.98 billion, +12.5% YoY):

  • Steady growth continues as the market matures. Longi solidifies its position as a premium brand, with BC technology becoming a significant portion of global high-efficiency module sales.

Profitability Forecast: From Loss to Profit

Analysis of the Turnaround:
* 2025: The remaining loss in 2025 is primarily due to the lag effect of low-priced orders and the continued depreciation of newer capacities. However, the magnitude of the loss is drastically reduced (-64% vs 2024). The Q2 trend of narrowing losses is expected to continue through H2 2025.
* 2026: This is the pivotal year. We expect gross margins to turn positive and expand as the BC product mix exceeds 50-60%. Operating expenses, now streamlined, will not grow proportionally with revenue, leading to significant operating leverage. EBIT is forecast to turn positive (CNY 3.48 billion), driving net profit to CNY 3.93 billion.
* 2027: Profitability strengthens further. Net margin expands to 6.6%, and ROE returns to a healthy 9.2%. This demonstrates the Company’s ability to generate sustainable returns on equity in a normalized market environment.

Cash Flow and Balance Sheet Projection

• Operating Cash Flow (OCF):

  • 2025E: CNY -0.87 billion. Negative OCF reflects the working capital drag from losses and inventory adjustments.
  • 2026E: CNY 11.10 billion. Strong turnaround as profitability returns and working capital normalizes.
  • 2027E: CNY 13.80 billion. Robust cash generation supports dividends and future investments.

• Capital Expenditure (CAPEX):

  • CAPEX remains elevated in 2025 (CNY 8.78 billion) to fund the BC capacity expansion.
  • It moderates in 2026-2027 (CNY 6.15 billion annually) as the major capacity build-out completes. This discipline in CAPEX spending post-2025 will enhance free cash flow conversion.

• Debt Management:

  • The Company is projected to manage its debt levels prudently. The interest-bearing debt ratio is expected to remain stable, ensuring financial flexibility. The strong cash position allows Longi to repay higher-cost debt if necessary, further reducing financial expenses.

Strategic Recommendations for Investors

1. Accumulate on Weakness:
Given the volatility in the PV sector, short-term price fluctuations may occur due to macro news or monthly shipment data. Investors should use any dips as buying opportunities, focusing on the long-term structural recovery story rather than quarterly noise.

2. Monitor BC Shipment Mix:
Key metric to watch: The quarterly breakdown of BC vs. TOPCon module shipments. An accelerating shift towards BC will be a leading indicator of margin improvement. Investors should closely monitor management commentary on BC yield and customer acceptance.

3. Track Industry Policy Implementation:
The success of the "anti-involution" measures is critical. Watch for concrete outcomes from the August 19 symposium, such as industry-wide production caps or minimum price guidelines. Positive developments here will accelerate the timeline for price recovery.

4. Assess Overseas Expansion:
Longi’s ability to grow overseas silicon wafer sales (+70% YoY in 1H 2025) is a positive sign. Investors should monitor progress in establishing local manufacturing partnerships or facilities in key markets (US, Middle East, Europe) to mitigate trade risks.

Comparative Valuation Context

While specific peer comparisons are not detailed in the source text, generally, Longi trades at a discount to its historical averages due to the current cyclical trough.
* P/B Ratio: Currently around 2.17x (2025E). Given the temporary nature of the losses and the strong asset base, this multiple is reasonable for a market leader with a clear path to recovery.
* Forward P/E: Not meaningful for 2025 due to losses. However, the 2026E P/E of ~31.9x and 2027E P/E of ~20.6x suggest that the market is pricing in a gradual recovery. For a technology leader with a durable moat, a 20x P/E on 2027 earnings is attractive, especially considering the potential for earnings beats if BC adoption exceeds expectations.

Conclusion

Longi Green Energy is navigating one of the most challenging periods in the history of the photovoltaic industry with resilience and strategic clarity. The 1H 2025 results confirm that the Company is successfully executing its turnaround strategy: cutting costs, reducing losses, and pivoting to high-value BC technology.

The combination of a fortress balance sheet, leading technology (HPBC 2.0), and a stabilizing industry environment creates a compelling investment case. While near-term headwinds persist, the medium-to-long-term outlook is robust. Longi is well-positioned to emerge from this consolidation phase stronger, more profitable, and with a greater market share.

We reiterate our BUY rating. Institutional investors with a 12-24 month horizon should consider Longi a core holding in the renewable energy sector, offering exposure to the inevitable recovery of the solar industry and the specific alpha generated by Longi’s technological leadership.

Appendix: Detailed Financial Tables

Income Statement Summary (CNY Millions)

Balance Sheet Highlights (CNY Millions)

Cash Flow Statement Summary (CNY Millions)

Key Financial Ratios

Analyst Notes & Methodology

Forecast Methodology:
Our earnings forecasts are based on a bottom-up analysis of Longi’s business segments (Silicon Wafers, Cells/Modules). We have incorporated the following assumptions:
1. Shipment Volumes: Aligned with Company guidance and industry demand forecasts, assuming modest volume growth in 2025 and stronger growth in 2026-2027.
2. Average Selling Prices (ASPs): We assume ASPs remain depressed in 2025 but begin to recover in late 2025 and throughout 2026, driven by policy interventions and capacity clearance.
3. Cost Structure: We factor in the continued benefits of operational efficiency (lower OpEx) and the learning curve effects in BC manufacturing (lower COGS for BC products over time).
4. Product Mix: We assume a rapid shift in sales mix towards HPBC 2.0 modules, which carry higher margins, starting in 2H 2025 and accelerating in 2026.

Risk Adjustment:
Our forecasts are conservative regarding the speed of price recovery. We have not assumed a V-shaped rebound in prices, but rather a gradual U-shaped recovery. This provides a margin of safety in our estimates. Any faster-than-expected price normalization would result in upward revisions to our 2026-2027 earnings estimates.

Disclaimer:
This report is based on information available as of August 23, 2025. Future developments in trade policy, technology, or market dynamics may require updates to these forecasts. Investors should conduct their own due diligence and consult with financial advisors before making investment decisions.

Deep Dive: The Strategic Importance of HPBC 2.0

To fully appreciate the investment case for Longi, it is essential to understand the technical and commercial advantages of its HPBC 2.0 technology. This section provides a deeper analysis for technically oriented investors.

What is BC (Back Contact) Technology?

Traditional solar cells have metal grid lines on the front surface to collect electricity. These grids block sunlight, reducing efficiency, and are aesthetically unappealing. BC technology moves all electrical contacts to the back of the cell.
* Advantages:
1. Higher Efficiency: No front shading allows more light to reach the silicon, boosting conversion efficiency. Longi’s 24.8% module efficiency is a testament to this.
2. Aesthetics: The uniform black appearance is highly preferred for residential rooftops, a high-margin segment.
3. Reliability: Reduced risk of micro-cracks and corrosion on the front surface.

Why HPBC 2.0 is a Game Changer for Longi

Previous generations of BC technology were complex and expensive to manufacture, limiting their adoption. Longi’s HPBC 2.0 addresses these challenges:
* Simplified Process: Longi has developed proprietary processes that simplify the manufacturing steps, reducing CAPEX and OPEX per watt.
* High Yield: The 97% mass production yield is critical. In solar manufacturing, yield is a primary driver of cost. A high yield means less waste and lower unit costs, allowing Longi to compete on price with TOPCon while offering superior performance.
* Scalability: The ability to ramp up to 24GW of owned capacity and collaborate with partners for additional capacity demonstrates that the technology is ready for mass market deployment.

Market Implications

The success of HPBC 2.0 allows Longi to escape the "commodity trap."
* TOPCon Market: Highly competitive, with dozens of manufacturers producing similar products. Margins are thin.
* BC Market: Fewer competitors with mature, high-yield BC technology. Longi can command a premium price, protecting its margins.
* Customer Lock-in: Installers and homeowners who prefer the aesthetics and performance of BC modules are likely to remain loyal to Longi, creating a sticky customer base.

As the industry evolves, we expect BC technology to capture an increasing share of the global market, particularly in developed economies where aesthetics and space efficiency are valued. Longi’s early mover advantage and scale in BC position it to be the primary beneficiary of this trend.

Conclusion: A Resilient Leader Poised for Recovery

Longi Green Energy’s 1H 2025 results are a testament to the Company’s resilience and strategic foresight. By aggressively cutting costs, reducing impairments, and accelerating the rollout of its superior HPBC 2.0 technology, Longi has significantly narrowed its losses and positioned itself for a strong recovery.

The broader industry context is also improving, with policy interventions aimed at ending destructive price wars. Longi’s robust financial position ensures it can weather any remaining storm and emerge as a dominant leader in a more rational, profitable market.

For institutional investors, Longi offers a compelling combination of downside protection (strong balance sheet) and upside potential (technology leadership and industry recovery). We maintain our BUY rating and recommend accumulating shares on any market weakness, with a target horizon of 12-24 months to capture the full benefit of the anticipated earnings recovery in 2026 and 2027.