Hz info:Satellite Chemical Co., Ltd. is accelerating the localization of high-end new materials, powered by dual engines of core technological breakthroughs and full industrial chain layout. During an investor Q&A session on July 22nd, Satellite Chemical showcased its progress in core technologies and industrialization.

600,000-ton Capacity Layout in PV Field; Advances Construction of POE Industrial Plant

China's chemical industry faces structural issues of "low-end overcapacity and high-end shortage." The self-sufficiency rate for high-end polyolefins is only 65%, with products like high-end polyethylene and POE heavily reliant on imports. The challenges in localization lie in technological barriers such as high-performance catalysts, polymerization processes, and comonomer technologies. To address this, Satellite Chemical has established a high-level R&D team and proactively deployed resources to break through key technologies.

Responding to investor inquiries about the company's POE photovoltaic film material entering the polysilicon auxiliary materials field, the company clarified: POE (Polyolefin Elastomer), as a critical encapsulation material, has broad application prospects in polysilicon modules. It offers excellent electrical insulation, weather resistance, and resistance to ion migration, making it suitable for PV module encapsulation in extreme climates.

Satellite Chemical emphasized that its independently developed ethylene tetramerization technology for high-selectivity production of high-purity 1-octene has overcome the "bottleneck" issue of core POE raw materials, forming a significant technological barrier. Currently, the company's POE industrial plant is under accelerated construction, aiming for early commissioning to alleviate China's heavy dependence on POE imports. Furthermore, the second phase of the Lianyungang α-Olefin High-end New Materials Industrial Park project explicitly includes 3 sets of 200,000-ton/year POE units. This strategic deployment will directly serve the PV industry chain, meeting the upgraded demand for high-performance encapsulation materials driven by new battery technologies.

Dual Drivers: Resilient Growth & Supply Chain Safeguarding

While technology breakthroughs continue, Satellite Chemical demonstrates strong financial resilience. The company's H1 2025 performance forecast indicates an expected net profit attributable to shareholders of 2.7 billion to 3.15 billion yuan, representing a year-on-year increase of 31.32% to 53.20%, with basic earnings per share of 0.8 to 0.94 yuan. Facing severe challenges such as the US-China trade war and ethane export restrictions in H1 2025, Satellite Chemical stated it achieved counter-cyclical growth through three core strategies: actively formulating environmental response plans, optimizing capacity structure and technological innovation for cost reduction and quality improvement, and deepening customer cooperation to precisely capture market opportunities. This fully demonstrates its sustained profitability in complex environments.

Reportedly, on July 2nd, the US Department of Commerce formally terminated ethane export restrictions, completely eliminating Satellite Chemical's supply chain risk. Relying on the Orbit platform, jointly operated with ET, as one of China's main ethane import channels, the company has contracted supply volumes as high as 150,000 barrels per day. Additionally, in 2024, Satellite Chemical added leases for 8 ULEC (Ultra Large Ethane Carrier) vessels, scheduled for delivery in 2027. By then, its operated VLEC (Very Large Ethane Carrier) fleet will reach 14 vessels, securing its position as the world's largest, providing solid support for stable raw material supply and global competitiveness.

Full-Chain Deepening Layout in High-End Materials

Beyond PV materials, the company is accelerating expansion in high value-added sectors. On January 6, 2025, Satellite Chemical commenced construction on an annual 90,000-ton acrylic acid and 100,000-ton refined acrylic acid project in Nanhu District, Jiaxing, with a total investment of 440 million yuan. Covering 38,000 square meters, the project is expected to generate an annual output value of 1.36 billion yuan and tax revenue of 195 million yuan upon completion. Currently, the tower-type heat exchanger (crystallizer) for this project, manufactured by China Chemical Equipment Technology Co., Ltd., has been shipped. It will primarily be used for purifying general acrylic acid into high-purity acrylic acid and processing Super Absorbent Polymer (SAP), laying a solid raw material foundation for the high-end resin layout.

Leveraging its upstream raw material advantages, Satellite Chemical officially signed a contract for an annual 300,000-ton SAP project at its headquarters on January 18th, with Chairman Yang Weidong presiding over the ceremony. With a total investment of 1.2 billion yuan, the project will build a new 56,000-square-meter production base, becoming a significant domestic SAP capacity layout upon completion. This hydrophilic polymer material with a loose network structure can absorb hundreds of times its own weight in water while maintaining excellent water retention properties, covering 90% of domestic applications across three major fields: baby diapers, adult incontinence products, and feminine hygiene products.

Industry data shows the global SAP market is steadily growing from $12.89 billion in 2021 towards a target of $18 billion by 2028, with an average annual growth rate of about 5%, indicating a rapidly developing sunrise industry. Since domestic companies broke through technological barriers in 2011, Satellite Chemical, alongside leading enterprises like Wanhua Chemical, has driven the industry into an investment boom. With existing and planned global capacity exceeding 5 million tons/year, the launch of this 300,000-ton project will further strengthen Satellite Chemical's leading position in China's high-end chemical new materials sector.

Green Transformation Shaping a Sustainable Future

Satellite Chemical is accelerating its green low-carbon transformation strategy, simultaneously deploying hydrogen energy and eco-friendly material upgrades. Leveraging its hydrogen-rich advantage at the raw material end, the company is actively building a full hydrogen industry chain system. In 2024, its Lianyungang base built a hydrogen platform with a daily filling capacity of 900,000 Nm³, capable of supplying PV and hydrogen enterprises within a 300-kilometer radius. The smooth commissioning of the Phase III PSA unit at the Pinghu base significantly enhanced hydrogen production capacity, and the supporting high-pressure hydrogen pipeline network is under full construction. The company plans to achieve an annual hydrogen production capacity of 400,000 tons in the future, striving to become East China's largest hydrogen supplier. It aims to achieve industrial chain synergy through hydrogen-based chemicals, establishing a green low-carbon demonstration base.

In material innovation, the company invested 265.9 million yuan in a water-based emulsion technical upgrade project, optimizing annual capacity to 160,000 tons. This project includes 100,000 tons of styrene-acrylic emulsion for architectural coatings, 40,000 tons of pure acrylic emulsion for packaging and decoration, and 20,000 tons of vinyl acetate acrylic emulsion, with odor-free products accounting for 30%. Post-upgrade, it is expected to add an annual output value of 1.29 billion yuan, pushing the plant's total output value beyond 4.1 billion yuan.

Satellite Chemical pointed out that demand for water-based polymer emulsions, as eco-friendly materials, continues to rise. This adjustment expands application scenarios by optimizing formulations, reducing residual monomer content while enhancing production process adaptability. It meets the market's high standards for green products and strengthens the company's global competitiveness.

Additionally, the company innovatively converts captured CO？ from production processes into lithium battery key material - carbonate esters, achieving carbon resource recycling. These initiatives are propelling Satellite Chemical steadily along a new industrialization path characterized by high technological content and strong economic benefits.

The company's sustainable development practices have also received authoritative recognition. It was successfully selected for the Forbes China Top 50 Sustainable Industrial Enterprises list, and its Wind ESG rating jumped to the highest AAA level on July 22nd, demonstrating the market's high affirmation of its long-term development potential and sense of responsibility.