Cai Xin Securities: Storage chip prices rebounded and then fell back, DRAM and NAND prices tended to stabilize.

CAI Xin Securities released a research report stating that it maintains a "leading the market" rating for the electronics industry. Spot prices follow the market, reflecting the supply and demand relationship of products. It is expected that the significant rebound in storage chip prices in the previous round was partly due to production control and price stability on the supply side. Whether prices can further increase in the future depends on whether the demand can continue to improve. Currently, DRAM and NAND prices are stabilizing after falling, and it is recommended to pay attention to module-related companies. Events: 1) According to DRAMexchange data, on December 30, the average spot prices of DDR3, 4, and 5 were 0.78, 3.77, and 4.69 US dollars respectively, with a week-on-week change of +0.0%, +0.0%, +0.0%, compared to the lowest prices before the rebound, -18.8%, +38.6%, +20.9% respectively. 2) According to CFM data, on December 31, the market prices of 256GB and 512GB SSD were 15.2, 26.2 US dollars respectively, with a week-on-week change of -1.3%, -1.9%, compared to the lowest prices before the rebound, +49.0%, +37.9% respectively. Key points from Cai Xin Securities: DRAM: 1) Bottoming out: The spot price of DRAM chips continued to decline until 2023Q3, with DDR3, 4, 5 reaching their lowest prices of 0.96, 2.72, 3.88 US dollars respectively. 2) Rebound: The price of DRAM chips rebounded after hitting bottom, with DDR3 reaching a peak of 1.09 US dollars at the end of February 2024, a rebound of 13.5%. The prices of DDR4 and 5 peaked in August and September, reaching 3.88 and 5.17 US dollars respectively, with rebounds of 42.6% and 33.2% respectively. 3) Stabilizing adjustment: After reaching a peak, the spot price of DRAM chips fell and gradually stabilized. The prices of DDR3, 4, 5 on December 30 fell 28.4%, 2.8%, 9.3% compared to their highest points; compared to the beginning of the year, they were -25.0%, +9.3%, +10.4%. The price of DRAM chips is gradually stabilizing, with the older product DDR3 showing relatively weaker prices. NAND: 1) Bottoming out: The spot price of NAND chips continued to decline until the end of July 2023, with the lowest prices of 256GB and 512GB SSD being 10.2 and 19.0 US dollars respectively. 2) Rebound: NAND prices peaked in April 2024, reaching highs of 19.0 and 33.0 US dollars respectively, with rebounds of 86.3% and 73.7% respectively. 3) Decline stabilizing: After reaching a peak, the spot price of NAND chips fell and gradually stabilized. The prices of 256GB and 512GB SSD on December 31 fell 20.0%, 20.6% compared to their previous highs; compared to the beginning of the year, they were -15.6%, -18.1%. The price of NAND chips fluctuates more, but has also been stabilizing towards the end of the year, with a week-on-week hold since December 31. Investment recommendation: Maintain a "leading the market" rating for the electronics industry Recommended module-related company: Shenzhen Longsys Electronics (301308.SZ). Risk warning: Risks of lower-than-expected demand, supply surplus, and prices not rebounding as expected.