1

Counter-Cyclical Accumulation of Strength

In 2024, the sales volume of high-purity crystalline silicon reached 467,600 tons, representing a year-on-year increase of 20.76%. The production and sales volume accounted for approximately 30% of the national total, ranking first globally in market share.

The sales volume of solar cells hit 87.68GW during the same period, a year-on-year increase of 8.70%, maintaining its eight-year reign as global cell shipment champion with a global market share of approximately 14%.

In terms of modules, the company's PV module sales in 2024 were 45.71GW, surging 46.93% year on year.

The ability to "blossom in multiple areas" by virtue of an integrated layout. Its resilience that it demonstrates against market downturns stems from the "three pillars" of technology-driven cost reduction and innovation, financial resilience, and global layout.

Bolstered by these pillars, Tongwei Co., Ltd. demonstrates exceptional anti-cyclical capabilities in navigating the PV industry's downturn.

2

Dual Engines: Technology-Driven Cost Reduction and Innovation

At the industry's trough where survival dominates priorities, enterprises become trapped in an endless vicious cycle of price wars amid overcapacity.

Against this backdrop, maintaining intensive R&D investment for high-quality growth requires extraordinary vision from industry leaders.

Tongwei has employed a dual-engine approach of technological cost reduction and innovation to offset the industry's price decline.

On the one hand, the company has continuously reduced costs and increased efficiency by optimizing processes and innovating mechanisms, thereby improving market competitiveness; on the other hand, through multi-dimensional technological innovation, it has prepared sufficient ammunition for the upcoming technological iteration.

In terms of technology cost reduction, Tongwei has introduced key equipment and technology such as 60 pairs of rod reduction furnaces, high-boiling cracking, and waste silicon powder recycling to optimize processes and innovate process mechanisms, with significant results in reducing consumption. Among them, the comprehensive power consumption and silicon consumption have been reduced to within 46 degrees and 1.04Kg, respectively. As of the end of the first quarter of 2025, the cost of production at Tongwei's Inner Mongolia base has been reduced to within RMB 27,000/ton (excluding tax).

In terms of technological innovation, Tongwei mainly focuses on bottlenecking issues and adopts a multi-pronged technology breakthrough strategy. The power of its TOPCon series modules TNC and HJT module series THC has repeatedly broken records.

On March 20, Tongwei Co., Ltd.'s PV Technology Center announced that, as tested by the internationally authoritative certification organization TÜV, the TNC 2.0 module achieved a front-side power output of 682.8W, approximately 60 watts higher than the current mainstream mass-produced modules of the same size, at a standard size of 2382*1134mm, with a conversion efficiency of 25.28%; the Tongwei TNC 2.0 module reached a power output of 778.5 watts, approximately 60 watts higher than the current mainstream mass-produced modules of the same size, with a conversion efficiency of 25.06% under the standard size of 2384*1303mm, once again setting new records for module efficiency and power output for the two mainstream TOPCon module types.

The mainstream power level of TNC module in mass production is expected to increase by over 25W in 2025, driven by a series of efficiency-enhancing actions integrating cells and modules.

Furthermore, as a leading enterprise in the development of TOPCon PECVD technology, Tongwei is promoting PECVD technology to gradually become the industry mainstream.

In the HJT field, Tongwei's HJT 210-66 modules have broken the world record nine times in a row, with the highest component power reaching 790.8W, corresponding to a module efficiency of 25.46%. The copper interconnection 2.0 technology route also facilitates the implementation of a silver-free HJT solution.

In the BC field, TBC products have successfully obtained TUV Rheinland certification and shipment qualifications; the batch power of 210R-66 version on the pilot line reached 660W, ranking among the industry's top tier.

At the forefront of perovskite technology, the efficiency of perovskite tandem cells has reached 34.17%, alongside the successful selection and layout planning of megawatt-level experimental line equipment.

These achievements are largely attributed to Tongwei's ongoing investment in technological research and development, as well as the support of its dedicated team.

Building upon its research framework across various PV business segments, Tongwei has established a PV Technology Center, which includes several national-level enterprise technology sub-centers. Over the past three years, the cumulative investment in research and development has exceeded RMB 11 billion. By the end of 2024, the number of R&D personnel has increased by 1,120 year-on-year, reaching a total of 5,277.

With this talent pool, by the end of 2024, Tongwei's PV sector has accumulated 2,675 authorized patents, covering several core technologies across the three main segments of high-purity crystalline silicon, PV cells, and modules.

These core technology reserves may fortify Tongwei's competitive edge in the upcoming wave of technological iterations, establishing a robust moat of technology and patents.

According to the general logic of PV industry growth, the technological pathway has consistently been a battleground for major factions and industry leaders. The entity that controls the technological standards and leadership will gain a developmental advantage.

As the industry stabilizes and recovers, the accumulation of technological reserves will drive the company towards value realization, shifting competition from mere price wars and capacity battles to a more sophisticated and differentiated technological competition.

The continuous accumulation of technological advantages will ultimately facilitate the optimization and upgrading of production capacity structures, translating into core product premiums.

Furthermore, the recent frequent release of policy incentives is particularly beneficial for "technology-driven" enterprises and advanced production capacities.

In November of last year, the Ministry of Industry and Information Technology officially issued the revised Regulatory Conditions for the Photovoltaic Manufacturing Industry (2024 Edition). The new regulations have raised the industry entry barriers, imposing stricter requirements on various technical indicators, production energy consumption, and capital ratio.

The new regulations enhance the efficiency metrics for all types of solar cells and modules, while also increasing the energy and water consumption standards for PV manufacturing projects, including polysilicon, silicon ingots, silicon rods, wafers, cells, and modules. Additionally, the minimum capital ratio for newly established and expanded PV manufacturing projects has been raised from the original 20% to 30%.

These policies are likely to guide the market towards the further elimination of outdated and inefficient production capacities, accelerating technological iteration, and consequently, the industry concentration will tilt towards leading enterprises. High-quality industry leaders, such as Tongwei, are expected to benefit from these developments.

3

Globalization Strategy: Charting New Narratives in Overseas Expansion

As the domestic PV market becomes increasingly competitive, major PV companies are venturing abroad in search of new growth opportunities.

The year 2024 marked a pivotal moment for Tongwei as it deepened its engagement in overseas markets.

From a strategic perspective, Tongwei has focused on high-potential markets through technology transfer and localized partnerships, accelerating its penetration into the global market.

In 2024, Tongwei achieved 16 new regional product certifications and secured GW-level project orders in countries such as Saudi Arabia and Poland, as well as orders from South Africa and the UAE, resulting in a year-on-year increase of 98.76% in overseas sales. The company was also recognized in Forbes' Top 30 list of Chinese companies excelling in global expansion.

Currently, Tongwei's modules are distributed across over 70 countries and regions, widely utilized in various applications including residential rooftops, commercial distributed systems, and large centralized power plants.

The European market serves as the primary battleground for its overseas operations. To address this market, the company launched the TNC-G12/G12R series of modules, achieving full power coverage from 455W to 720W. In Europe, Tongwei has signed collaboration agreements with leading distributors such as R.Power S.A. in Poland and PVO International B.V. in the Netherlands.

The burgeoning markets in the Middle East and Africa also represent significant targets for Tongwei's international expansion.

In September of last year, Tongwei officially signed a supply agreement for the Saudi PIF Phase IV MUWAYH photovoltaic project with ACWA POWER, committing to provide 1.175GW of TNC-G12R 66 high-efficiency PV modules for the project.

Additionally, Tongwei has established partnerships with overseas PV companies such as ACO and AMEA Power to expand its presence in African markets, including South Africa and Egypt.

In October 2024, the company entered into a strategic distribution agreement with the renowned Australian distributor, Blue Sun Group. The agreement stipulates that Tongwei will supply 1GW of high-efficiency modules to Blue Sun Group over the next five years.

The performance in 2024 and the first quarter of 2025 is under pressure, reflecting both the growing pains of the PV industry transitioning from chaotic growth to high-quality development and a historical opportunity for leading enterprises to restructure their competitiveness and seize technological advantages.

During this challenging period of cyclical adjustment in the PV sector, Tongwei Co., Ltd. is leveraging its technological moat, financial resilience, and global strategy as three pillars to build strength in a counter-cyclical manner, while reconstructing competitive barriers with a "survivor takes all" approach.

This path of breakthrough not only epitomizes the transformation and upgrading of China's PV industry but also offers a "Chinese solution" for global energy transition.

The combined effects of increased industry concentration and policy guidance may further amplify the Matthew effect for leading enterprises in the future.