Galaxy Securities: Anti-involution policy trend continues, space photovoltaic industry accelerates.

China Galaxy Securities released a research report stating that the policy against internal competition has not changed, but there have been disruptions in specific actions. With the decrease in commercial space launch costs and breakthroughs in battery technology, space photovoltaics are expected to gradually commercialize in the next 10-15 years. Focus on (1) companies with reserves in space photovoltaic technology. (2) Leading companies with strong advantages in new technologies such as BC and copper slurry. (3) The silicon material segment that benefits the most from the anti-internal competition policy. (4) Companies that are relatively independent from the main chain and prioritize synergies between light and storage. Event: In early 2026, the State Administration for Market Regulation called to halt self-disciplinary actions related to silicon material integration platforms in the photovoltaic industry, defining it as involving monopolies and prohibiting coordinated actions related to agreed production capacity, price, market division, etc., and requiring submission of rectification plans before January 20th. The main points of China Galaxy Securities are as follows: The trend of the anti-internal competition policy continues, and the coordinated governance of the industrial chain is being explored continuously. This is a rare incident of ex-ante review, and no exemptions related to anti-internal competition or integration in the photovoltaic industry were given. However, this is not a complete denial, as stopping monopolistic self-discipline practices such as pricing, production volume, market division, etc., does not prevent the advancement of compliance measures such as selling above cost, protecting intellectual property, improving technical standards (such as increasing component efficiency to 24%+), and regulating bidding processes. Previously, on December 26, 2025, the State Administration for Market Regulation conducted compliance guidance on price competition order in the photovoltaic industry in Hefei, Anhui, setting clear and standardized requirements for all participants in the photovoltaic industry chain, forming a collaborative governance framework of "companies (strictly prohibited from engaging in unfair pricing practices such as price collusion and fraud) + power generators (seeking 'high-quality and fair-priced' bids, strengthening product quality requirements) + associations (fulfilling self-disciplinary functions, rather than self-regulating through coordinated measures such as production capacity and pricing)". The bank believes that the trend of the anti-internal competition policy has not changed, but there have been disruptions in specific actions. The upward trend in industry chain prices continues, and the industry recovery is on the rise. According to data from the Silicon Industry Sub-Association, the average transaction price of recycled N-type silicon materials this week was 5.92 million yuan/ton, a weekly increase of +9.83%. According to infolink data, N-type M10L/G12R/G12 silicon wafer prices are maintained at 1.4, 1.5, and 1.7 yuan/piece, with N-type battery cells (183N, 210RN, 210N) averaging up to 0.39 yuan/watt. Top component companies have successively raised their prices, with the average price of TOPCon components in China rising to 0.7 yuan/watt, reflecting the increase in costs such as silver prices. It is expected that with the gradual recovery of end demand in Q1 2026, industry chain profits are expected to gradually recover, turning losses into gains in the industry in 2026. The rise of commercial space travel accelerates the space photovoltaic industry. Recently, Elon Musk publicly stated his plans to deploy 100GWCECEP Solar Energy artificial intelligence satellite energy networks into space annually. China plans to deploy gigawatt-level space data centers in phases from 2025 to 2035, achieving "earthly data processed in space". The space economy (satellite internet, deep space exploration, etc.) requires stable energy supply, and space photovoltaics have high energy conversion efficiency, providing continuous power generation for 24 hours and increasing annual electricity production hours and energy density by 7-10 times compared to ground-based photovoltaics. In terms of technological development, gallium arsenide will be dominant in the short term, with perovskite stacked cells expected to become mainstream in the medium to long term. With the decreasing costs of commercial space launches and breakthroughs in battery technology, space photovoltaics are expected to gradually commercialize in the next 10-15 years. Risk warning: Risks of policy changes below expectations; risks of technological development falling short of expectations.