China Securities Co.,Ltd.: Continue to focus on semiconductor materials import substitution trades.

China Securities Co.,Ltd. released a research report stating that AI inflation has now reached the materials end, and targets in the materials segment are more dispersed, with most strong companies located in Japan, and tensions in bilateral relations since the second half of 2025 showing more signs of acceleration. Import substitution on the supply side and AI inflation on the demand side form an almost perfect combination. China Securities Co.,Ltd. judges that there will be more room for the Japan import substitution theme to play out, and continues to focus on semiconductor materials import substitution trades, paying attention to the certification pace and investment opportunities of domestic semiconductor materials companies accelerating import substitution. Continue to focus on material selection under import substitution trades. Japanese semiconductor materials companies have a high global market share in semiconductor materials, and according to China Securities Co.,Ltd. statistics, they rank first in market share in 14 out of 19 major materials. On one hand, demand expansion is driven by industry trends; on the other hand, the supply substitution logic is driven by tense bilateral relations, and import substitution of key materials is expected to further play out. China Securities Co.,Ltd. has screened out sub-sectors where Japanese companies currently have high market share, focusing on investment opportunities brought by accelerated domestic substitution: Photomasks, blank masks, semiconductor precursors, CMP polishing pads, photoresists and monomers, ceramic powders, InP substrates, PI films, high-end fluorinated materials, wet electronic chemicals, large silicon wafers, etc. Apple accepts Samsung memory price increases for next year's first quarter. According to Jinshi Data on September 15, sources from the industrial chain indicate that Apple has accepted Samsung Electronics' memory chip quotes for the first quarter of 2027: DRAM (Dynamic Random Access Memory) at nearly $2.0/Gb, and NAND flash at nearly $0.33/Gb, up 30%-40% from third-quarter quotes this year. Against the backdrop of AI computing power siphoning off capacity, a structural shortage of general-purpose memory has become inevitable. Forced by high costs, domestic memory is expected to usher in a strategic opportunity for accelerated adoption. United Airlines extends Neste SAF procurement agreement, further validating the booming demand for international aviation decarbonization. On September 16, Neste, the world's largest sustainable aviation fuel (SAF) producer, announced an extension of its SAF supply agreement with United Airlines, covering the two major international aviation hubs of Chicago O'Hare and Amsterdam Schiphol, with supply at Chicago airport continuing until June 2027. The industrial significance is that long-term orders between leading airlines and leading fuel suppliers have once again been confirmed, indicating that under the dual drivers of the EU's ReFuelEU mandatory blending policy and airlines' net-zero commitments, overseas SAF demand has shifted from pilot procurement to normalized, large-scale procurement, further increasing demand certainty. For the industrial chain, first, the landing of long-term agreements is expected to improve the expected investment returns of SAF projects and promote accelerated deployment of new global capacity; second, China's biodiesel and SAF companies can leverage mature HEFA processes and EU certification qualifications to capture overseas demand gaps, opening up export space; third, raw material supply and refueling infrastructure links in the aviation decarbonization chain will also benefit simultaneously. This event provides a clear overseas demand-side catalyst for the SAF sector. According to China Securities Co.,Ltd. statistics, this week's new materials sector price gainers were: SAF Europe FOB (+7.94%), polyetheramine D230 (+3.57%), epoxy resin (+3.28%); this week's larger decliners were: lithium iron phosphate (-1.84%). This week's new materials sector leaders were flavors and fragrances, PLA, etc. This week's top 5 new materials gainers were: Shandong Ruifeng Chemical, Henan Jindan Lactic Acid Technology, Huabao Technology, Zhejiang Hisun Biomaterials, Guangdong Decro Film New Materials; this week's top 5 new materials decliners were: Guangzhou Jointas Chemical, Longyan Zhuoyue New Energy, Chongqing Sanxia Paints, Shandong Sanyuan Biotechnology, Zanyu Technology Group. This week the new materials sector outperformed the basic chemicals sector: this week the Shenwan secondary chemicals new materials sector index weekly change was +1.80%, the Shenwan basic chemicals index weekly change was +1.24%, the CSI 300 index weekly change was -0.06%, the Shanghai Composite Index weekly change was +0.61%, and the Shenzhen Component Index weekly change was +1.26%. Apple releases its first foldable iPhone, and consumer electronics usher in a new round of form-factor innovation cycle. On September 9, according to Reuters, Apple officially launched its first foldable phone, the iPhone Duo, with a starting price of $1,999. The product features a 7.6-inch display when unfolded and is equipped with the A20 Pro chip using a 2nm process, further strengthening on-device AI, graphics processing, and multitasking capabilities. Apple's entry is expected to leverage its brand influence and software-hardware ecosystem to accelerate foldable phones from a niche category to the mainstream, driving demand growth in core segments such as flexible OLED, hinges, precision structural components, thermal management, and advanced-process chips, opening a new cycle of product innovation and value enhancement for the consumer electronics industrial chain. TSMC's 1.4nm super cluster takes shape, with four fabs in the second-phase Central Taiwan Science Park to begin mass production next year. On September 9, the Central Taiwan Science Park Bureau confirmed that TSMC's second-phase expansion for 1.4nm construction in Central Taiwan is fully accelerating. The first fab (P1) has completed its steel structure and is expected to begin trial operations in April next year, with mass production expected in the second half of next year. It is understood that TSMC has applied to the Central Taiwan Science Park Bureau to build two temporary offices at the site, expected to be completed simultaneously in April next year, with more than 5,400 operations and outsourced personnel moving in in the first batch. This also means that the P1 fab will start trial operations in April next year and may enter mass production in the second half of the year, ahead of the originally scheduled 2028 mass production timeline. OpenAI launches flagship model GPT-6 Astra to accelerate commercialization across multiple scenarios. OpenAI officially released its new-generation flagship model GPT-6 Astra, which achieved comprehensive breakthroughs in autonomous computer operation (OSWorld 72.6%), mathematical research (ARC-AGI-3 reaching 99.9%), and programming engineering (Terminal-Bench 57.7%), and introduced a cross-context preservation mechanism to solve the problem of forgetting in long tasks; although its cybersecurity capability has reached the "Critical" threshold, the company ensures compliance and alignment through enhanced behavioral trajectory monitoring; the model is currently being opened in phases to ChatGPT paying users and API/AWS Bedrock, with standard API pricing at $10 input/$50 output per million tokens, further reducing actual business deployment costs through higher per-task token efficiency. Power silicon-carbon monthly shipments exceed 300 tons, solid-state batteries accelerate commercialization. According to the latest data from GGII, by August 2026, domestic monthly shipments of new silicon-carbon powder for power batteries had exceeded 300 tons, and monthly shipments of composite silicon-based materials had exceeded 4,000 tons; it is expected that full-year shipments of new silicon-carbon composite materials for power batteries in 2026 are expected to exceed 50,000 tons. GGII data shows that in 2025 China's full-year shipments of new silicon-carbon pure powder exceeded 2,000 tons, equivalent to more than 15,000 tons of silicon-based composite materials. At that time, the digital market had already been rolled out, while the power sector, affected by factors such as material consistency, was still overall in the validation stage. Now, one month's shipments of new silicon-carbon powder for the power market alone are equivalent to 1.8 times the 2025 national average monthly shipment of new silicon-carbon pure powder, and solid-state batteries are accelerating toward mass production. Nvidia's Q2 results greatly exceeded expectations, driving continued high prosperity in AI computing power. Nvidia announced on August 26 local time that second-quarter total revenue was $96.2 billion, up 18% quarter-over-quarter and up 106% year-over-year; data center business revenue was $89 billion, up 117% year-over-year, becoming the core DRIVE of performance. This quarter, both GAAP and non-GAAP gross margins reached 75%, GAAP diluted earnings per share were $2.46, and non-GAAP diluted earnings per share were $2.22. Nvidia provided third-quarter guidance, expecting revenue of $108 billion (2%), which does not include China data center computing business revenue, with gross margin expected at 74%. In the second quarter, the company returned $26 billion to shareholders through buybacks and dividends, with $99 billion remaining in repurchase authorization. Nvidia Chief Financial Officer Colette Kress said Nvidia's performance growth will accelerate next year, with revenue expected to grow 70% in fiscal 2028. She also said, "Even at our current scale, demand is still accelerating. Customer forecasts show that our growth next year will double." Trump signs executive order: battery energy storage systems included in prohibition list. On August 26, U.S. President Trump signed the executive order "Declaring a National Emergency to Safeguard the Security of the United States' Large Power Systems." In addition to large transformers, generators, and circuit breakers, battery energy storage systems (BESS), grid-connected inverters, and uninterruptible power supplies serving critical infrastructure were explicitly included for the first time in this type of national security review. This means that Chinese energy storage products entering the United States will no longer face only tariffs and tax credit restrictions. The U.S. government will have more direct administrative power to decide whether products can be imported, deployed, and continue operating. At present, the executive order directly targets large power system equipment such as energy storage systems and inverters, does not specifically name battery cells, and does not announce a ban on all Chinese energy storage products. Specific implementation rules will be formulated by the U.S. Department of Energy within the next 120 days. Export peak season arrives, silicon wafers surge this week. On August 21, the Silicon Industry Branch of the China Nonferrous Metals Industry Association released the latest silicon wafer prices, with downstream demand increasing and silicon wafer prices rising sharply this week. The average transaction price of N-type G10L monocrystalline silicon wafers (182*183.75mm/130m) was 1.12 yuan/piece, up 40.00% from last week; the average transaction price of N-type G12R monocrystalline silicon wafers (182*210mm/130m) was 1.14 yuan/piece, up 26.67% from last week; the average transaction price of N-type G12 monocrystalline silicon wafers (210*210 mm/130m) was 1.22 yuan/piece, up 10.91% from last week. The main reason for the sharp increase in silicon wafer prices this week was increased downstream demand. Specifically: although domestic end demand was moderate, affected by the 232 policy, overseas cell companies accelerated purchases of silicon wafers during the window period to avoid risks, while India's traditional installation peak season arrived, driving a concentrated release of silicon wafer export orders. Increased demand, combined with the market sentiment of buying on the rise rather than on the fall, created a short-term tight supply situation, driving silicon wafer prices upward. The EU's mandatory blending policy continues to be implemented, further accelerating the expansion pace of the global SAF market. According to Bloomberg, the latest data from leading European airlines show that IAG Group, Air France-KLM, and Ryanair achieved actual SAF blending ratios of 3.3%, 2.9%, and 2.0% respectively in fiscal years 2025-2026. The overall scale of SAF use by European airlines has exceeded the total of all U.S. airlines. The core factor driving the difference is the mandatory blending regulations implemented by the EU and the UK, with policy clearly stating that the UK's aviation fuel SAF blending ratio will rise to 3.6% in 2026. Rigid demand growth in the European market will drive long-term SAF premiums upward globally. Domestic leading companies with bio-jet fuel and e-SAF technology reserves are expected to usher in a growth window for overseas export orders, while the industrial demonstration effect of overseas markets will also raise expectations for domestic blending policy implementation. Upstream biomass raw materials, green hydrogen synthesis, SAF refining engineering, and other industrial chain links all have medium- to long-term prosperity catalysts. SK Hynix announces large-scale buyback plan. On August 19, SK Hynix announced a plan to buy back and fully cancel 40 trillion won (about $28.6 billion) of stock, the largest in South Korean listed company history. According to SK Hynix's filing with the Korea Exchange, the buyback amount is 40.0043 trillion won, corresponding to about 24.07 million shares based on the closing price of 1.662 million won the day before the board resolution, accounting for 3.3% of the company's total issued shares. The buyback plan is expected to begin implementation on August 20 and last about three months, after which all repurchased shares will be fully canceled. Two ministries issue the "15th Five-Year Plan for New Power System Construction." On August 3, the National Development and Reform Commission and the National Energy Administration issued a notice on the "15th Five-Year Plan for New Power System Construction," setting out development goals for the power system and various power sources during the 15th Five-Year Plan. The document states that by 2030, a new power system will be initially established: a green and low-carbon power supply pattern will basically take shape, the share of non-fossil energy generation will reach 50%, and more than 2.8 billion kilowatts of new energy will be consumed at a high level. On new energy, the plan proposes setting guiding targets for new energy utilization rates by region and tier, with the utilization rate of Shanxi Guoxin Energy Corporation maintained at around 90%. MIIT releases the "15th Five-Year Plan" for industrial green and low-carbon development: green power application in the industrial sector enters a period of large-scale acceleration. On July 31, the Ministry of Industry and Information Technology officially issued the "15th Five-Year Plan for Industrial Green and Low-Carbon Development" (MIIT Regulation [2026] No. 169), setting a roadmap for the green transformation of the industrial sector during the 15th Five-Year Plan period. In this document, green energy is placed at an unprecedented strategic heightfrom energy structure transformation to industrial spatial layout, from microgrid construction to green power direct connection models, the industrial sector is becoming the next main battlefield for new energy consumption. The plan clearly states that by 2030, carbon dioxide emissions in the industrial sector will peak, the proportion of green energy application will increase significantly, energy consumption per unit of added value of industrial enterprises above designated size will fall by more than 10%, carbon dioxide emissions will fall by more than 17%, the proportion of output value of green factories at all levels in the total output value of manufacturing above designated size will increase from 30% in 2025 to 45%, and the number of zero-carbon factories cultivated and built will reach 500. The "15th Five-Year Plan for Renewable Energy Development" was released, setting targets including 3.5 billion kilowatts of total renewable energy installed capacity by 2030, more than 2.8 billion kilowatts of wind and solar power, and annual generation of 6 trillion kilowatt-hours, and for the first time proposing reliable substitution targets: average confidence output of wind and solar reaching 8%, wind and solar electricity accounting for more than 20% during summer and winter evening peaks, and more than 300 million kilowatts of new reliable peak power generation capacity during the 15th Five-Year Plan. It deploys 370 million kilowatts of new installed capacity in the "Three-North" bases, 100 million kilowatts of offshore wind power starting construction, and 300 million kilowatts of new distributed new energy, and clarifies that the confidence output of newly built centralized wind and solar stations should in principle be no less than 10%. Samsung launches its first AI smart glasses, and the Android XR wearable ecosystem accelerates its formation. On July 22, Samsung Electronics released its first AI smart glasses at the Galaxy Unpacked 2026 event in London, equipped with the Qualcomm Snapdragon AR1 Gen1 chip, using Google Android XR as the underlying operating system, integrating the Gemini AI assistant, with a built-in camera supporting real-time visual perception, up to 9 hours of battery life per charge, and planned for launch in autumn 2026. This product is the first consumer-grade lightweight wearable commercialization on the Android XR platform, forming direct competition with the Meta Ray-Ban series, and is expected to accelerate penetration of the AI glasses category and drive demand growth in industrial chains such as low-power AI chips, optical modules, and acoustic components. The world's first "sea-based net recovery" rocket first stage successfully recovered. At around 12:00 on July 10, 2026, China's space industry welcomed a historic momentthe Long March 10B carrier rocket ignited and lifted off from Pad 2 of the Hainan Commercial Space Launch Site and successfully completed a sea-based net recovery mission. This is China's first successful controlled recovery of a carrier rocket first stage, and also the world's first carrier rocket net recovery. This feat marks a major breakthrough in China's reusable carrier rocket technology. In the next three years, China's commercial space launch costs are expected to fall by about 50%, and the global space competition landscape will shift from unipolar dominance to a China-U.S. bipolar parallel structure, with related materials expected to benefit. Focus on material selection under import substitution trades. AI inflation has reached the materials end, and targets in the materials segment are more dispersed, with most strong companies located in Japan, and tensions in bilateral relations since the second half of 2025 showing more signs of acceleration. Import substitution on the supply side and AI inflation on the demand side form an almost perfect combination. China Securities Co.,Ltd. judges that the import substitution theme will have more room to play out. Japanese semiconductor materials companies have a high global market share in semiconductor materials, and according to China Securities Co.,Ltd. statistics, they rank first in market share in 14 out of 19 major materials. On one hand, demand expansion is driven by industry trends; on the other hand, the supply substitution logic is driven by tense bilateral relations, and import substitution of key materials is expected to further play out. China Securities Co.,Ltd. has screened out sub-sectors where Japanese companies currently have high market share, focusing on investment opportunities brought by accelerated domestic substitution: photomasks, blank masks, semiconductor precursors, CMP polishing pads, photoresists and monomers, ceramic powders, InP substrates, PI films, high-end fluorinated materials, wet electronic chemicals, large silicon wafers, etc. Wet electronic chemicals: driven by AI demand, the domestic substitution rate is expected to rise again. Wet electronic chemicals are mainly used in wet processes such as cleaning, etching, development, and stripping in the manufacturing of electronic devices such as semiconductors and display panels. They undergo strict purification, have extremely low impurity content, and possess high technical barriers and customer stickiness. On the demand side, driven by AI, advanced processes and applications such as 3D NAND are spreading, and unit consumption of wet electronic chemicals is expected to increase significantly. On the supply side, the global wet electronic chemicals market is still dominated by foreign companies from Japan, Germany, and the United States, and the domestic substitution rate in the high-end G5 market is still less than 30%. In addition, relying on the stable supply of upstream general chemical raw materials, combined with the rapid expansion of downstream domestic storage and logic chip capacity and accelerated customer validation, China's product structure upgrading and domestic substitution rate improvement in the G5 high-end wet electronic chemicals industry are expected to continue to materialize. ArF photoresist monomers are highly monopolized by Japan, and domestic substitution is expected to accelerate. Photoresist resin monomers have long been monopolized by Japanese companies, with prominent supply disruption risks. Even Japanese photoresist companies outsource monomers, so a domestic breakthrough in photoresists cannot fully guarantee independent controllability; only import substitution of monomers can ensure the reliability of domestic supply. For monomers, the key lies in purity and batch stability. Resin monomers for G-line, I-line, and KrF photoresists have already achieved initial domestic substitution, while ArF photoresist resin monomers are at a bottleneck stage, with 70% of global supply controlled by Osaka Organic Chemical. Once supply is cut off, advanced processes will face raw material shortages. Therefore, import substitution of ArF photoresist resin monomers is a necessary condition for ensuring the sustainable development of China's semiconductor industrial chain. MLCC nano ceramic powders see prosperity reversal driven by AI demand. AI servers are upgrading from GB300 to Vera Rubin/Rubin, and automotive electronics are expanding under electrification/800V/high-level autonomous driving, creating bottlenecks in high-end MLCC and transmitting upward to barium titanate powders/formulated powders. AI-grade powders have particle sizes of 100-300nm and require higher consistency and batch stability. AI-grade powder prices are also significantly higher than traditional powders; at the same time, high-end formulated powders rely on rare earth doping systems, and under rare earth export constraints and China-Japan supply chain security trades, expansion and closed supply in the Japanese system face uncertainty. Domestic suppliers such as Guoci, one of the few in China with mass production capability for high-end MLCC dielectric powders, are expected to fully benefit from the expanding demand for high-end MLCC powders in the AI era. Fluorinated materials: performance drives explosive growth in AI & semiconductor application scenarios, a good choice for import substitution. PFA: due to its extremely low metal ion leaching characteristics and resistance to strong acid and alkali corrosion, it can be used in etching tanks, cleaning tanks, CMP components, heat exchanger linings in semiconductor etching and cleaning processes, as well as wafer carriers and CVD reaction chamber coatings during wafer transfer. It is expected that with the advancement of advanced processes, PFA demand growth will be significant. On the supply side, high-end semiconductor-grade PFA is mainly monopolized by overseas companies Chemours and Daikin. Zhejiang Juhua recently put into production 10,000 tons of ultra-pure PFA, becoming the first domestic company to break through the 600,000 yuan/ton price level. Electronic-grade PTFE: PTFE has extremely low Df and Dk values, making it the most ideal high-frequency high-speed CCL substrate resin material at present. Because PTFE is significantly cheaper than other materials, combined with performance advantages, it is expected to enter a period of high-speed volume growth. FEP: high-end FEP can also be used in optical fiber protective layers and semiconductor wet cleaning pipelines, among other scenarios. Under the rapid development of advanced semiconductor processes, new energy, and high-frequency communications, the fluoropolymer materials industry is upgrading. Fluoropolymers have extremely stable performance due to the strong bond energy of C-F bonds, with excellent corrosion resistance, chemical stability, and dielectric properties. In semiconductors: 1) PFA, fully known as melt-processable polytetrafluoroethylene, is a high-end modified version of PTFE. PFA has become an irreplaceable key material in advanced semiconductor processes due to its extremely low metal ion leaching characteristics and resistance to strong acid and alkali corrosion. PFA can currently be used in etching tanks, cleaning tanks, CMP components, heat exchanger linings in semiconductor etching and cleaning processes, as well as wafer carriers and CVD reaction chamber coatings during wafer transfer. High-end products in the semiconductor field can reach the 600,000 yuan/ton price band. Currently, global semiconductor market demand is about 20,000 tons, and domestic demand is about 6,000-7,000 tons. It is expected that with the advancement of advanced processes, PFA demand growth will be significant. Global PFA production capacity is mainly overseas. Recently, Zhejiang Juhua achieved 10,000-ton-level independent mass production of ultra-pure PFA, achieving independent controllability, with broad room for import substitution. 2) FFKM, fully known as perfluoroether rubber, is an upgraded version of fluororubber FKM. In the molecular structure of FFKM, carbon-fluorine bonds replace all carbon-hydrogen bonds, providing excellent ultra-high temperature resistance, resistance to extreme gas-liquid chemical corrosion, resistance to plasma-rich erosion, and ultra-high cleanliness. It is the best overall performance variety among all synthetic rubbers and an indispensable sealing consumable in advanced semiconductor processes. Current global total demand is about 200 tons, and it is monopolized by overseas giants such as Chemours, Daikin, Solvay, and DuPont. AI + drones drive the optical fiber industrial chain, and the materials end is expected to enjoy a major trend of rising volume and price. AI large model training is pushing data center network architecture from traditional three-tier aggregation to a fully interconnected leaf-spine architecture, with data traffic shifting from north-south access to east-west interconnection within GPU clusters. To meet non-blocking, low-latency communication needs, optical fiber consumption per rack or per GPU is growing rapidly. In addition, the rapid expansion of drones has also made optical fiber a consumable. Driven by AI + drone demand, upstream optical fiber materials such as silicon tetrachloride, silicone D4, optical fiber coatings, and para-aramid are expected to usher in a major trend of rising volume and price. With the rapid growth of high-frequency high-speed demand such as computing power, electronic-grade PTFE is expected to be applied on a large scale. PTFE materials are known as the "King of Plastics" due to their main characteristics including excellent thermal stability, chemical resistance, and dielectric properties. PTFE's three major downstream demandsmilitary, server high-speed cables, and high-speed boardsare all expected to grow rapidly. As Nvidia's next-generation server Rubin ultra approaches mass production, the industry is actively discussing the possibility of using PTFE materials as orthogonal backplanes, and domestic Shengyi Technology is actively cooperating in validation. China Securities Co.,Ltd. believes that with the continued growth of high-frequency high-speed transmission demand led by computing infrastructure, PTFE's downstream applications are expected to be redefined. Focus on the certainty of volume growth and value enhancement in the precursor industry under downstream capacity expansion. Precursor products benefit from the major cycle of downstream capacity expansion, with strong certainty of high performance growth. Downstream wafer fabs such as Hynix plan to double wafer fab capacity in the next five years, and ChangXin also has an expansion plan to nearly double capacity by 2030. Based on the critical role of precursor products in the manufacturing process and the subsequent increasingly microscopic/high-end chip manufacturing process, China Securities Co.,Ltd. believes that leading companies in the industry have a high possibility of bargaining power with downstream customers and a leap in value with product category iteration. Rapid AI development triggers an MLCC shortage wave. With the rapid development of the artificial intelligence industry, AI servers, due to huge power consumption, have significantly higher MLCC deployment than ordinary servers. According to China Securities Journal, the increase is about more than 3 times, and surging demand has intensified supply tightness. Electrification, intelligence, and connectivity have become development trends in the automotive industry. With the increase in control modules, MLCC usage per vehicle has also increased significantly. Rianlon Corporation: the anti-aging agent cycle is expected to improve, and multiple businesses developing in an orderly manner will support growth. In 2025, players in the anti-aging agent industry generally suffered losses, and the industry fell to a historic bottom. The industry spontaneously began anti-involution actions and pushed prices to begin recovering at year-end. Since March 2026, overseas BASF and Songwon have twice announced 20% price increases for anti-aging agent products, which will accelerate price recovery, and the company is expected to fully benefit. In 2025, the company's lubricant additive business reached a profitability inflection point. With the implementation of API and the onboarding of major customers, it is expected to accelerate upward in the future. In addition, the company's life sciences business is progressing smoothly in customer development, PI materials are being sampled, and the Malaysia base is advancing in an orderly manner, which is expected to support high-quality growth. SEMI stated that despite the impact of the Middle East crisis, trade uncertainty, and raw material shortages, the surge in semiconductor demand will continue. Driven by AI data centers, global semiconductor sales are expected to reach $1 trillion this year and double to $2 trillion by 2035. Geopolitical risks will hardly suppress industry prosperity this year, but raw material shortages may affect long-term prospects. Countries are addressing shortages of critical minerals and key gases such as bromine and helium. Helium prices rose sharply in March due to the Middle East situation, and bromine also faces shortage risks. The main supply source of helium is blocked, downstream acceptance of price increases is high, and price elasticity is worth anticipating. 1) Supply side: current main import sources in the Middle East and Russia are almost completely "zeroed out." Even if Middle East gas sources immediately fully resume shipping, considering cargo transportation time plus facility restart time, it would still take months; Russian expected replenishment sources are blocked, and export controls on helium were implemented from April 14; 2) Demand side: in major end applications such as MRI and semiconductors, helium accounts for a relatively low proportion of overall cost, and acceptance of price increases is still acceptable; 3) Inventory side: the conflict has lasted nearly three months, and domestic inventories have fallen rapidly. China Securities Co.,Ltd. believes that helium prices have sufficient momentum to continue rising, with huge elasticity. Planned wind and solar installations exceed 930GW, and 21 provinces and cities announce key new energy plans for the 15th Five-Year Plan. As of April 2026, among the 31 provinces and cities nationwide, 21 provinces and cities including Inner Mongolia, Shanxi, Beijing, Tianjin, Heilongjiang, Jilin, Shandong, Shanghai, Anhui, Zhejiang, Jiangsu, Hunan, Hainan, Guizhou, Yunnan, Sichuan, Gansu, Ningxia, Shaanxi, Qinghai, and Tibet have announced their 15th Five-Year Plan outlines. Based on the new energy construction targets of each province and city and installed capacity as of the end of 2025, the planned new wind and solar scale in the 21 provinces and cities exceeds 930GW. Among them, Inner Mongolia has the largest planned new scale, nearly 155GW. Qinghai is second, at about 102GW. Shanxi, Gansu, Jiangsu, Shandong, and Sichuan have planned new scales of 50GW or more. Solid-state battery mass production accelerates in 2026. Starting in 2026, solid-state batteries have continued to be a hot market, with 16 solid-state battery and material projects put into production, started construction, or signed. Sixteen solid-state battery and material projects in Jiangsu, Zhejiang, Guangdong, and other places have been intensively started, put into production, or signed, including 8 put into production or started and 8 signed, covering the two core links of core electrolyte materials and solid-state batteries. Among them, semi-solid-state battery technology is more mature and is currently the main force for mass production in the industry, while all-solid-state batteries are in the "mass production pilot, commercial exploration" stage. On the technology side, among projects already put into production or started, the oxide electrolyte route is faster in mass production and commercialization. On the materials side, there are 2 solid-state battery projects put into production or started, namely the Zijin Mining Group solid-state battery lithium battery new materials project and the Taizhou Qingtao solid-state battery raw materials project (Phase I). At present, the prosperity of the solid-state battery industry continues to climb, and leading companies are advancing pilot line construction and product trial production validation. It is expected that more heavyweight all-solid-state products will be launched in the second half of 2026.