Sanxiang Advanced Materials Co., Ltd. (603663)

Equity Research Report | Sector: Zirconium-Based New Materials and Advanced Materials | Report Date: September 13, 2026 | As of the close on September 11, 2026 (15:00); September 12, 2026 is a Saturday, A-share market closed

This report is automatically compiled and generated by AI based on public information, for reference only, and does not constitute investment advice.

1. Core Summary

Sanxiang Advanced Materials achieved operating revenue of RMB 563.34 million in the first half of 2026, up 0.23% year-on-year; net profit attributable to shareholders of the parent company was RMB 77.0099 million, up 71.48% year-on-year; net profit attributable to shareholders of the parent company after deducting non-recurring gains and losses was RMB 73.9883 million, up 65.33% year-on-year; and net cash flow from operating activities was RMB 93.2432 million. The earnings forecast was basically fulfilled. The company exhibits characteristics of "basically stable revenue and significantly improved profit," with growth mainly driven by increased volume in zirconium-based businesses such as nuclear-grade sponge zirconium and nano zirconium, as well as new market development, customer structure optimization, and an increased proportion of high-end customers.

The company's core business remains zirconium-based new materials, positioned in the deep processing of zircon sand, intermediate material manufacturing, and the extension into high-end zirconium-hafnium materials. Traditional products such as fused zirconia and zirconium oxychloride are significantly affected by the prosperity of downstream sectors including ceramics, glass, steel, and refractory materials; in the first half of 2025, there was a decline in sales volume, prices, and profits. Directions such as nuclear-grade sponge zirconium, nano zirconia, zirconium-hafnium separation, advanced ceramics, and solid-state electrolytes constitute the main potential support for product structure upgrading and profitability improvement.

The company's profit growth rate in the first half significantly exceeded its revenue growth rate, but there is considerable uncertainty in institutional profit forecasts for full-year 2026 and 2027–2028, with only two institutions—Zheshang Securities and Huaxin Securities—providing forecasts. Based on the closing price of RMB 41.54 on September 11, 2026, the dynamic PE-TTM is approximately 164.76x, significantly higher than the approximately 64.9x, 38.1x, and 28.6x for 2026–2028 corresponding to the institutional average forecasts, indicating that the current valuation has already reflected strong future earnings growth expectations.

Technically, the stock price has recently experienced high volatility and active trading. The closing price on September 11 was below MA10, MA20, and the Bollinger middle band, but still above MA50 and MA200; MACD remains positive and RSI is approximately 51, indicating that the medium-term structure has not completely weakened, but short-term momentum has diminished. The company's controlling shareholder and persons acting in concert collectively hold over 54%, and the external free float is relatively limited. Recent abnormal fluctuations and high turnover mean that short-term prices may be significantly affected by capital speculation.

2. Company Overview

2.1 Basic Information

2.2 Main Business and Product Layout

• Zirconium-based products: Fused zirconia, industrial-grade sponge zirconium, nuclear-grade sponge zirconium, zirconium oxychloride, nano zirconia, zirconia ceramics, as well as advancing directions in zirconium-hafnium separation, nuclear-grade and electronic-grade zirconium-hafnium materials.
• Magnesium-based and lightweight materials: Through a equity stake in Ningde Huizhi Magnesium-Aluminum Technology Co., Ltd., the company is positioned in magnesium-aluminum alloys and large-scale integrated die-casting. Products include aluminum alloy and magnesium alloy battery PACK structural components, mainly targeting new energy vehicle parts and energy storage sectors.
• Casting modification materials: Nodulizers, inoculants, cored wire, etc., used in ductile iron, automotive parts, wind power, construction machinery, rail transit, and cast pipe sectors.
• Advanced ceramics and other new materials: Special ceramics, advanced ceramics, zirconia ceramics, zirconium-based solid-state electrolytes, low-cost battery-grade fused zirconia, and other R&D and industrialization directions.
• Business importance: Zirconium-based remains the core business and main line of the industry chain; magnesium-based, advanced ceramics, and casting modification materials are extension businesses. The relevant chapters of the 2025 semi-annual report did not disclose the complete revenue proportions of the three major segments, and the business structure proportions cannot be inferred from this.

2.3 Industry Chain Upstream and Downstream Position and Cost-Profit Structure

Sanxiang Advanced Materials is positioned in the mid-stream deep processing and high-end zirconium-hafnium material extension segments of the zirconium industry chain. It is not an upstream resource enterprise with pricing power over zircon ore resources, nor is it a brand enterprise primarily targeting end consumers. The industry chain is roughly "zircon sand → fused zirconia, zirconium oxychloride → industrial-grade/nuclear-grade sponge zirconium, nano zirconia, advanced ceramics → nuclear power, chemicals, electronic ceramics, semiconductors, new energy, refractory and wear-resistant materials, and other end applications."

• Zirconium-based products mainly use zircon sand; fused zirconia production also uses coke and generates recoverable microsilica fume as a by-product. Electricity for arc furnace smelting accounts for approximately 80% to 85% of total electricity consumption in fused zirconia production, making electricity an important cost item.
• China's zircon resources are relatively limited, and zircon sand mainly relies on imports. The company disclosed that major global zircon sand suppliers include ILUKA, Rio Tinto, and Tronox, which together account for more than 50% of global zircon sand production; this information comes from company disclosures, and the research notes do not provide independent third-party cross-verification.
• In terms of zircon sand procurement, the company is generally a price taker rather than a resource-based enterprise with raw material pricing power. Costs are affected by international zircon sand prices, exchange rates, shipping, and supplier concentration.
• The company owns Fujian Sanxiang Yangmeizhou Power Co., Ltd. and its own hydropower. Disclosures state that its own hydropower can meet most of its production needs, helping to reduce electricity costs for fused zirconia; however, the specific proportion of self-generated electricity to total electricity consumption was not disclosed, and the cost contribution cannot be quantified.
• The company buffers upstream pressure through long-term supply relationships, process improvements, its own hydropower, and intra-industry chain synergies, but zircon sand still mainly relies on external procurement.
• Traditional downstream customers include steel, glass, ceramics, refractory materials, casting, chemicals, and machinery industries. In the first half of 2025, the company disclosed that real estate adjustments and weak prosperity in traditional industries such as steel, ceramics, glass, and refractory materials led to declines in both sales volume and prices of fused zirconia products compared to the previous year.
• High-end and emerging downstream customers include nuclear power, nuclear equipment, aerospace, electronic ceramics, new energy batteries, semiconductor materials, and advanced ceramics customers. These customers have higher requirements for purity, stability, quality certification, supply continuity, and process formulations, with longer certification cycles, but customer stickiness and product value-added are typically higher than traditional general-purpose materials.
• Sponge zirconium has been shipped in batches to domestic customers and major overseas nuclear equipment enterprises; specific customer names and the combined proportion of the top five customers could not be fully verified in this research material, and reliable customer concentration data was not provided. Specifics should be based on the 2025 annual report.
• The industry bargaining relationship is as follows: The company is both affected by upstream zircon sand supplier pricing and needs to pass on raw material and energy costs to traditional industrial customers. In the first half of 2025, zirconium-based product selling prices declined and profits decreased, indicating that cost pressures could not be fully passed on to downstream customers.
• The company structurally hedges through growth in high-end applications such as sponge zirconium, high-end friction materials, and new energy materials; zirconium-based chloride solid-state electrolytes have been supplied in small batches to downstream solid-state battery enterprises, and battery-grade fused zirconia has been supplied in batches to downstream customers, but the research notes do not provide the scale of their revenue contribution.
• As of June 30, 2025, accounts receivable were RMB 329.5 million, up 64.48% from RMB 200.4 million at the end of 2024; prepayments were RMB 13.36 million, up 130.28% from the end of 2024; contract liabilities were RMB 7.86 million, up 74.77% from the end of 2024. Operating revenue for the first half of 2025 was RMB 562.1 million, and net profit attributable to shareholders of the parent company was RMB 44.91 million. Based on a static comparison of period-end figures with half-year data, accounts receivable accounted for approximately 58.6% of half-year revenue and approximately 7.3x net profit attributable to shareholders of the parent company, indicating certain capital occupation by downstream customers; this comparison cannot replace the full-year accounts receivable turnover ratio.
• On the upstream side, the company disclosed that major global zircon sand suppliers ILUKA, Rio Tinto, and Tronox together account for more than 50% of global zircon sand production, but this data was not cross-verified with independent third-party statistics in this research. On the downstream side, the combined proportion of the top five customers and customer concentration data could not be reliably verified in this material. Specifics should be based on the 2025 annual report. The company disclosed that its market share in sponge zirconium-related markets exceeded 50% in the first half of 2025; this data is based on the company's own disclosure and no independent third-party cross-verification was found.

The company is positioned as "mid-stream scale manufacturing + high-end material upgrading": fused zirconia, zirconium oxychloride, and industrial-grade sponge zirconium are mid-stream deep processing products, affected by zircon sand and electricity costs as well as traditional downstream prosperity; directions such as nuclear-grade sponge zirconium, nano zirconia, zirconium-hafnium separation, advanced ceramics, and solid-state electrolytes are expected to enhance value-added. Future profit improvement mainly depends on declines in or hedging against zircon sand and electricity costs, recovery in zirconium-based product prices, volume growth of high-value-added products, and unit cost reductions brought by self-generated hydropower, internal raw material supply, and process improvements.

3. Financial Data and Valuation Analysis

3.1 Recent Operating Performance

Net profit attributable to shareholders of the parent company after deducting non-recurring gains and losses for H1 2026 was RMB 73.9883 million, up 65.33% year-on-year; net cash flow from operating activities was RMB 93.2432 million; basic earnings per share was RMB 0.18, up 63.64% year-on-year; weighted average return on equity was 5.46%. Period-end net assets attributable to shareholders of the parent company were RMB 1.44727 billion, up 5.78% from the end of 2025; period-end total assets were RMB 2.32270 billion, up 14.21% from the end of 2025. Net profit attributable to shareholders of the parent company after deducting non-recurring gains and losses for FY 2025 was RMB 115.53 million, up 58.67% year-on-year.

H1 2026 exhibited characteristics of basically stable revenue and significantly improved profit margins. Operating revenue grew only 0.23% year-on-year, but total operating costs declined year-on-year, total profit grew 84.69% year-on-year, and net profit attributable to shareholders of the parent company grew 71.48% year-on-year. Q2 revenue growth slowed compared to Q1, but profits still maintained rapid growth. Profit improvement may mainly come from improvements in product structure, product prices, or gross margins; specifics at the product dimension still need to be further confirmed in conjunction with the company's segment disclosures. Based on disclosed data calculations, the trailing twelve months net profit attributable to shareholders of the parent company as of the end of H1 2026 was approximately RMB 149.65 million; this figure is a calculated value and not an indicator directly disclosed by the company.

3.2 Profit Forecasts

As of September 11, 2026, the earnings forecast page of 10jqka showed that a total of 2 institutions provided forecasts within the past 6 months, namely Zheshang Securities and Huaxin Securities. The number of institutions is relatively small and cannot be regarded as a broadly covered market consensus. Average forecast operating revenue for 2026–2028 is RMB 1.633 billion, RMB 2.190 billion, and RMB 2.605 billion, respectively; average forecast net profit attributable to shareholders of the parent company is RMB 383 million, RMB 648 million, and RMB 860 million, respectively. The two institutions have significant differences in their 2027–2028 profit forecasts, indicating high forecast uncertainty.

3.3 Valuation Levels and Institutional Ratings

As of the close on September 11, 2026, the company's stock price was approximately RMB 41.54, total market capitalization approximately RMB 24.657 billion, and free float market capitalization approximately RMB 24.640 billion. Based on public financial reports and the stock price, the TTM price-to-earnings ratio is approximately 164.9x, calculated as the stock price of RMB 41.54 divided by trailing twelve months earnings per share of approximately RMB 0.252; the price-to-book ratio is approximately 17.0x, calculated as total market capitalization of approximately RMB 24.657 billion divided by net assets attributable to shareholders of the parent company of approximately RMB 1.447 billion at the end of June 2026. Based on the institutional average earnings forecasts, the forecast PE for 2026–2028 is approximately 64.9x, 38.1x, and 28.6x, respectively. If calculated using the institutional consensus target price of RMB 48, the potential upside from RMB 41.54 is approximately 15.6%. RMB 48 is a consensus target price aggregation and the public page does not fully disclose each institution's independent target price and valuation assumptions, so it cannot be equated with a formal consensus target price. The current TTM valuation is significantly higher than the valuation calculated based on future earnings forecasts, indicating that the market has already priced in strong earnings growth expectations in advance; if zirconium-hafnium product prices, the commissioning progress of the zirconium-hafnium separation project, semiconductor material customer certification, or order volume growth fall short of expectations, the valuation faces relatively high drawdown risk. The above valuation does not take into account future additional share issuances, equity incentive dilution, or other share capital changes.

4. Recent News and Announcements

4.1 H1 2026 Earnings Pre-Increase

On July 15, 2026, Sanxiang Advanced Materials disclosed an H1 2026 earnings pre-increase announcement. The company expected net profit attributable to shareholders of the listed company for H1 2026 to be approximately RMB 69 million to RMB 80 million, up 53.65% to 78.14% year-on-year; expected net profit after deducting non-recurring gains and losses to be approximately RMB 67.2 million to RMB 78 million, up 50.16% to 74.30% year-on-year. Earnings growth mainly came from increased volume in zirconium-based businesses such as nuclear-grade sponge zirconium and nano zirconium, as well as new market development, customer structure optimization, and an increased proportion of high-end customers. The above data are preliminary estimates by the finance department and have not been audited by certified public accountants.

4.2 H1 2026 Report Disclosed, Earnings Forecast Basically Fulfilled

On August 22, 2026, the company disclosed its H1 2026 report. H1 operating revenue was RMB 563.34 million, up 0.23% year-on-year; net profit attributable to shareholders of the listed company was RMB 77.0099 million, up 71.48% year-on-year; net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses was RMB 73.9883 million, up 65.33% year-on-year; net cash flow from operating activities was RMB 93.2432 million, compared with RMB 4.4835 million in the same period last year; basic earnings per share was RMB 0.18, up 63.64% year-on-year. The officially disclosed data fell within the previous earnings forecast range, and the earnings forecast was basically fulfilled.

4.3 Partial Release of Pledge on Controlling Shareholder's Shares

On July 28, 2026, the company disclosed an announcement regarding the release of part of the controlling shareholder's pledged shares. Ningde Huifu Investment Co., Ltd. released a pledge on 8.134 million shares, accounting for 8.02% of its shares in the company and 1.37% of the company's total share capital. The pledge release date was July 24, 2026. After the release, Huifu Investment held 101.45 million shares of the company, with a shareholding ratio of approximately 17.09%, and the remaining pledged shares were zero. Huifu Investment and its persons acting in concert collectively held approximately 325.36 million shares, accounting for approximately 54.81% of the company's total share capital, and the shares held by the relevant persons acting in concert were also not pledged. The company stated that it currently has no plan to use the released shares for subsequent pledges.

4.4 Abnormal Stock Trading Fluctuations and Risk Warning

On August 7, 2026, the company disclosed an announcement on abnormal stock trading fluctuations. The company's stock price deviation for three consecutive trading days from August 4 to August 6, 2026 cumulatively exceeded 20%, meeting the criteria for abnormal stock trading fluctuations. Following the company's self-examination and written inquiry to the controlling shareholder and actual controller, as of the announcement disclosure date, there was no major information that should be disclosed but had not been disclosed; directors, senior management, the controlling shareholder, the actual controller, and their persons acting in concert did not buy or sell the company's shares during the abnormal fluctuation period. The company warned that the controlling shareholder and persons acting in concert collectively held approximately 54.91%, the external free float was relatively small, and there was a risk of secondary market speculation.

4.5 Repurchase and Cancellation of Restricted Shares

On June 26, 2026, the company disclosed an announcement on the implementation of the repurchase and cancellation of equity incentive restricted shares. Because the company-level performance for the first unlock period of the initial grant under the 2025 stock option and restricted stock incentive plan was not fully up to standard, and the individual performance assessments of some incentive recipients did not meet all unlock conditions, the company repurchased and cancelled a total of 52,224 restricted shares. Both the number of repurchased shares and the number of cancelled shares were 52,224 shares, with the cancellation date being June 30, 2026. This matter is a routine cancellation after equity incentive assessments were not fully up to standard and is not a share repurchase plan targeting the secondary market.

4.6 Cancellation of Stock Options and Adjustment of Equity Incentive Parameters

On May 7, 2026, the company completed the cancellation of 224,864 stock options from the initial grant that could not be exercised, due to reasons including incentive recipients leaving, retiring, company-level performance assessments, and individual performance assessments not being fully up to standard. This cancellation will not reduce the company's share capital. Affected by the 2025 annual equity distribution and the exercise of some stock options, the company disclosed an announcement on August 22, 2026 regarding the adjustment of matters related to the equity incentive plan: the number of stock options under the initial and reserved grants was adjusted from 1,359,000 to 1,902,600, and the exercise price of the stock options was adjusted from RMB 19.96 per share to approximately RMB 14.19 per share.

4.7 Adjustment of Registered Capital and Total Share Capital Due to Equity Distribution

The company's 2025 annual equity distribution plan was a cash dividend of RMB 1 per 10 shares and a capital reserve capitalization of 4 shares per 10 shares. The record date was July 16, 2026, and the ex-rights/ex-dividend date was July 17, 2026. Due to the equity distribution and the exercise of some stock options, the company's registered capital and total share capital increased from approximately 423.25 million shares to 593.57 million shares. The relevant equity incentive parameters were adjusted accordingly, and the company stated that this adjustment will not have a material impact on its financial condition and operating results.

4.8 Arrangements for the First Extraordinary General Meeting of Shareholders in 2026

The company plans to hold its first extraordinary general meeting of shareholders in 2026 on September 16, 2026, to review the "Proposal on Increasing Registered Capital and Amending the Articles of Association." It plans to adjust the registered capital and total number of shares from RMB 423,247,526 and 423,247,526 shares to RMB 593,570,127 and 593,570,127 shares, mainly due to the 2025 capital reserve capitalization and the exercise of equity incentives. As of September 12, 2026, the extraordinary general meeting of shareholders has not yet been held, and the above matters are still pending review by the shareholders' meeting.

4.9 Cancellation of Certain Special Accounts for Raised Funds

On September 5, 2026, the company disclosed the "Announcement on the Cancellation of Certain Special Accounts for Raised Funds." The company raised a total of approximately RMB 220 million in funds through a targeted issuance of shares to specific investors in 2021, with net raised funds of approximately RMB 216.08 million. This cancellation involved the raised fund accounts at the Industrial and Commercial Bank of China Ningde Shouning Branch, China Construction Bank Shouning Branch, and Agricultural Bank of China Ningde Shouning Branch; the Bank of China Ningde Shouning Branch account had been previously cancelled. The raised fund account of Liaoning Huaxiang New Materials Co., Ltd. at Industrial Bank Fuzhou Chengbei Branch is still in use. The raised funds corresponding to the cancelled accounts have been fully used for the prescribed purposes, and the remaining interest has been transferred to the uncancelled special account for raised funds. This matter is an account cleanup after the completion of raised fund use and does not represent new financing, mergers and acquisitions, or asset disposals.

4.10 Arrangements for the H1 2026 Earnings Briefing

The company plans to hold its H1 2026 earnings briefing from 9:00 to 10:00 on September 22, 2026 through the SSE Roadshow Center. The pre-collection period for investor questions is from September 15 to before 16:00 on September 21, 2026. As of September 12, 2026, the earnings briefing has not yet been held, and there is no meeting Q&A content available for citation.

4.11 No New Repurchases, Mergers and Acquisitions, or Major Asset Restructurings Found Recently

As of September 12, 2026, no new share repurchase plans or repurchase progress announcements disclosed by the company from July to September 2026 were retrieved, nor were any major asset restructuring, merger and acquisition transactions, issuance of shares to purchase assets, or major external investment announcements retrieved. The repurchase and cancellation of 52,224 restricted shares implemented in June 2026 was a cancellation after equity incentive assessments and is not a share repurchase by the listed company for the purpose of maintaining stock price or shareholder rights.

4.12 No Recent Increases or Decreases in Holdings by the Controlling Shareholder or Regulatory Penalties Found

As of September 12, 2026, the controlling shareholder-related matters recently retrieved mainly consisted of the release of a pledge on 8.134 million shares in July 2026, which was not an increase or decrease in holdings; the August 2026 abnormal stock trading fluctuation announcement confirmed that the controlling shareholder and actual controller did not buy or sell the company's shares during the abnormal fluctuation period. On the SSE regulatory inquiry page and the company's recent announcement list, no latest regulatory inquiry letters, disciplinary actions, or administrative penalties against Sanxiang Advanced Materials were retrieved. The above conclusions only represent public search results as of September 12, 2026, and do not rule out announcement retrieval delays or undisclosed matters.

5. Stock Price Trend and Technical Analysis

5.1 Price Overview

5.2 Technical Indicators

As of September 11, 2026, Sanxiang Advanced Materials closed at RMB 41.54, down 3.80% from the previous trading day, after intraday rising to RMB 42.85 and then falling back. The stock price is slightly below MA20 and the Bollinger middle band, but still above MA50 and MA200; MACD remains positive, and RSI is in the neutral range, indicating that the medium-term technical structure has not completely weakened, but short-term momentum has diminished. Recent stock price volatility and trading activity have been high. After consecutive gains on September 9 and September 10, the stock rose and fell back on September 11, with some profit-taking pressure above RMB 43. Capital flow data diverges due to different sources and model methodologies, while shareholder concentration data has a time lag as of June 30, 2026. Therefore, short-term trends still need to be observed in conjunction with key price levels, trading volume, and subsequent capital flow data.

5.3 Short-Term Outlook (Next Week, Scenario Analysis, for Reference Only)

⚠️ Risk Warning: The following content is solely a subjective scenario analysis based on closing data as of September 11, 2026, public technical indicators, and trading data. It does not constitute investment advice and does not represent a deterministic forecast of actual future prices.

① Key Technical Levels

② Next Week Scenarios (Subjective Weighting, Not Statistical Probability)

• Consolidation (relatively high subjective weight, approximately 60%; a subjective heuristic judgment based on current technical and capital conditions, not statistical probability): Observation range approximately RMB 40.9~43.5. Trigger conditions are the stock price holding the RMB 40.9~41.8 support zone but failing to effectively break above the RMB 43.5 resistance zone; turnover maintaining within the recent normal range of approximately RMB 600 million~RMB 1.2 billion, and RSI continuing to fluctuate around 45~55. The current closing price is slightly below the Bollinger middle band, RSI is neutral, MACD is positive, and moving average signals are divergent, supporting a box consolidation scenario after a pullback from highs.
• Weaker Downside (moderate subjective weight, approximately 30%; a subjective heuristic weight, not statistical probability): Observation range approximately RMB 38.2~40.9. Trigger conditions are an effective break below RMB 40.9, while single-day turnover expands to above approximately RMB 1.2 billion~RMB 1.5 billion and the close is near the intraday low; if it further breaks below RMB 39.1~39.5, it may test the Bollinger lower band near RMB 38.2 and the September 4 low area. If the decline is accompanied by increased volume, it is necessary to observe whether support absorption is insufficient; if it breaks below RMB 38.2, the short-term technical structure may deteriorate significantly.
• Rebound and Strengthening (relatively low subjective weight, approximately 10%; a subjective heuristic weight, not statistical probability): Observation range approximately RMB 43.5~46.1. Trigger conditions are the stock price重新站稳 RMB 43.5, single-day turnover continuously expanding to approximately RMB 1.5 billion or higher, and the close remaining near the intraday high; if it further breaks above RMB 45.6~46.1, it may seek recovery toward approximately RMB 48. On September 9 and September 10, there were consecutive volume-driven gains, but on September 11 it rose and fell back, so a rebound and strengthening require synchronous confirmation of volume and price.

③ Capital and Liquidity Background

As of September 11, 2026, the turnover rate was 4.54%, and turnover was approximately RMB 1.121 billion; over the last 10 trading days, the turnover rate was approximately 2.12%~7.22%, and turnover was approximately RMB 498 million~RMB 1.807 billion. Overall trading is active, and short-term liquidity is acceptable, but relatively high turnover and large amplitude mean rapid chip exchange, and prices are easily affected by short-term capital inflows and outflows. Shareholder structure data as of June 30, 2026: the top ten circulating shareholders held approximately 67.53%, and the top three shareholders collectively held 53.02%, including both the controlling shareholder and related investment platforms, as well as Hong Kong Securities Clearing Company Limited and public funds; 10jqka disclosed that 236 institutions held positions during the same period, with holdings accounting for approximately 65.63% of circulating share capital. However, the number of shareholders increased 66.26% from March 31, 2026, and this data has a time lag relative to the September 11 market data, so the actual chip structure may have changed. In terms of capital flows, the 10jqka model methodology as of September 4 showed consecutive net outflows from September 1 to September 4, while modeled results on another page as of September 11 showed positive net large and extra-large order amounts for the last 5 and 10 days. Due to methodology differences, they cannot be simply combined or regarded as real account-level main force capital.

If the stock price重新站稳 RMB 43.5, while single-day turnover continuously expands to approximately RMB 1.5 billion or more and the turnover rate reaches approximately 6% or higher, this can serve as an observation signal that the rebound has been confirmed by volume; if turnover expands but the stock price still closes below RMB 40.9, it more likely reflects the release of selling pressure rather than effective capital participation.

④ Points to Watch (Observation Ideas Only, Not Trading Instructions)

• Observation idea, not a trading instruction: Watch whether the price can重新站稳 near RMB 41.8~42.0, an area close to MA20 and the Bollinger middle band.
• Observation idea, not a trading instruction: Watch whether the RMB 43.5~46.1 resistance zone can be broken on increased volume, especially whether turnover reaches approximately RMB 1.5 billion or more.
• Observation idea, not a trading instruction: Watch whether RMB 40.9 is lost; if lost, then observe absorption around RMB 39.1~39.8 and RMB 38.2.
• Observation idea, not a trading instruction: Watch whether main force capital data after September 11 can form continuous and same-methodology net inflow confirmation with the recent rise.

The above scenario analysis is based on the September 11, 2026 closing data and historical price and technical indicator calculations. Short-term stock prices will also be disturbed by multiple factors such as news, capital flows, and the broader market environment. Technical indicators themselves have lag and limitations and do not constitute a guarantee of actual future trends or buy/sell recommendations. Please make independent judgments based on the latest market information and bear investment risks yourself.

6. Industry Landscape and Competitor Analysis

6.1 Industry Status

The industry to which Sanxiang Advanced Materials belongs is the new materials industry, with business covering new inorganic non-metallic materials, special metal functional materials, rare metals and nuclear industry basic materials, chemical new materials, and some emerging material directions. Its core products span fused zirconia, zirconium oxychloride, industrial-grade and nuclear-grade sponge zirconium, nano zirconia, advanced ceramics, and casting modification materials.

6.2 Competitive Landscape

• High concentration at the raw material end: Zircon sand resources are mainly distributed in Australia, South Africa, and other regions. Large international mining companies have strong influence over raw material supply and prices, and China's self-sufficiency in zircon sand is limited.
• Obvious differentiation in mid-stream products: Traditional materials such as fused zirconia and zirconium oxychloride are relatively fully competitive, with prices significantly affected by the prosperity of ceramics, glass, refractory materials, and other industries; nuclear-grade sponge zirconium, high-purity zirconia, nano zirconia, and zirconium-hafnium separation place more emphasis on technology, certification, and stable supply.
• Downstream demand shows "traditional under pressure, emerging growth": In the first half of 2025, demand in traditional ceramics, refractory materials, steel, and glass sectors was weak, while nuclear power, nuclear equipment, advanced ceramics, new energy batteries, electronic materials, and semiconductors provided structural incremental growth.
• Industry competition has shifted from simple capacity competition to comprehensive competition of "raw material security + process technology + customer certification + industry chain synergy." Sanxiang Advanced Materials' advantages include scale in fused zirconia and industrial-grade sponge zirconium, its own hydropower, upstream-downstream synergy, and extended chain layout in zirconium-based products; its shortcomings are that zircon sand still mainly relies on external procurement, and traditional product prices and demand are susceptible to cyclical fluctuations.
• Capacity and project data are subject to scope limitations: Historical public information disclosed fused zirconia capacity of approximately 26,000 tons, but the same-scope latest data was not found in the directly searchable 2025 semi-annual report; the 1,300-ton nuclear-grade zirconium project and the zirconium-hafnium separation project include construction, renovation, and industrialization advancement content and cannot all be equated with already commissioned capacity.

6.3 Main Competitors

Compared with Orient Zirconic, Sanxiang Advanced Materials places more emphasis on fused zirconia, industrial-grade sponge zirconium, and zirconium-based upstream-downstream synergy; compared with Triumph Science & Technology, its business is more focused on zirconium-based materials and sponge zirconium, while Triumph Science & Technology is more representative in functional powders and applications in electronic information and new energy materials; compared with the Baoji Titanium system, State Nuclear Bao Ti Zirconium Industry, and China Nuclear Jinghuan Zirconium Industry, Sanxiang Advanced Materials is more representative in the scale of industrial-grade sponge zirconium and fused zirconia, but competition in nuclear-grade materials still needs attention; comparison with Changyu Group should be broken down by specific products such as zirconium oxychloride and zirconia powder, and different zirconium-based products should not be combined for comparison.

7. Risk Warnings

• Zircon sand mainly relies on external procurement, the company is a price taker, and global major suppliers are highly concentrated; if zircon sand prices, exchange rates, or shipping costs rise and the company cannot fully pass on costs to traditional downstream customers, it may compress profits from fused zirconia, zirconium oxychloride, and other products.
• Traditional downstream demand remains under pressure. The company disclosed that in the first half of 2025, real estate adjustments and weak prosperity in steel, ceramics, glass, and refractory materials led to declines in sales volume and prices of fused zirconia products; if related demand recovery falls short of expectations, core traditional products may continue to face price and sales volume pressure.
• There is uncertainty in high-end business volume growth and project industrialization. Businesses such as nuclear-grade sponge zirconium, zirconium-hafnium separation, advanced ceramics, semiconductor materials, and solid-state electrolytes involve customer certification, process stability, and continuous supply capability. Some projects are in the construction, renovation, or industrialization advancement stage, and planning or advancement content cannot be equated with already commissioned capacity.
• The company's accounts receivable and prepayments have grown rapidly. As of June 30, 2025, accounts receivable were RMB 329.5 million, up 64.48% from the end of 2024; prepayments increased 130.28%. Based on a static comparison of period-end accounts receivable with H1 2025 revenue, accounts receivable accounted for approximately 58.6% of half-year revenue. If collection pace slows, it may increase working capital occupation and credit impairment pressure.
• The current valuation relies heavily on future earnings growth. The closing price of RMB 41.54 on September 11, 2026 corresponds to a dynamic PE-TTM of approximately 164.76x, while the institutional average forecast corresponds to a 2026 PE of approximately 64.9x; if volume growth of products such as nuclear-grade sponge zirconium and nano zirconium, zirconium-hafnium product prices, or related project progress fall short of expectations, the valuation may face relatively large drawdown pressure.
• Institutional earnings forecast coverage is limited and differences are obvious. As of September 11, 2026, only Zheshang Securities and Huaxin Securities provided 2026–2028 forecasts, with particularly large differences in 2027–2028 net profit forecasts, and the forecast results have high uncertainty.
• The company's controlling shareholder and persons acting in concert collectively hold approximately 54.8% to 54.9%, and the external free float is relatively limited; recently, there was an abnormal fluctuation in which the cumulative price deviation exceeded 20% over three consecutive trading days, and the company has warned of secondary market speculation risk. Relatively high turnover and large intraday amplitude may amplify short-term price volatility.
• Technical and capital signals are divergent. The stock price is below MA10, MA20, and the Bollinger middle band, and recently rose and fell back after consecutive gains; capital flow data from different sources show phased net outflows and net large order inflows over the last 5 and 10 days, with inconsistent methodologies, and the sustainability of short-term trends still needs further confirmation.

8. Conclusion and Outlook

The company's current growth logic is mainly reflected in the upgrading of its zirconium-based product structure and expansion into high-end applications: products such as nuclear-grade sponge zirconium and nano zirconium have supported H1 2026 performance, sponge zirconium has been shipped in batches to domestic customers and major overseas nuclear equipment enterprises, zirconium-based chloride solid-state electrolytes have been supplied in small batches, and battery-grade fused zirconia has achieved batch supply. If high-value-added products continue to grow in volume, customer certification and order conversion proceed smoothly, and its own hydropower, process improvements, and industry chain synergy continue to play a role, the company's profitability is expected to improve further.

Whether subsequent performance can continue to improve depends on zircon sand procurement costs, electricity costs, zirconium-based product prices, recovery in traditional downstream demand, and the industrialization progress of projects such as nuclear-grade materials, zirconium-hafnium separation, semiconductor materials, and advanced ceramics. H1 2026 profit growth has been relatively significant, but revenue growth is still close to zero, indicating that profit improvement still needs further verification of its sustainability and sources; at the same time, institutional forecasts differ greatly, and forecast values should not be directly regarded as certain performance.

From the perspective of valuation and trading characteristics, the company's current stock price corresponds to a relatively high TTM valuation, and it has recently been in a state of high volatility and high turnover. The market already has relatively high expectations for future volume growth in high-end zirconium-based businesses. Going forward, focus should be on whether product structure improvement translates into sustained revenue and cash flow growth, and whether the stock price can obtain fundamental support amid large fluctuations; the above judgment is based only on the provided data and does not constitute buy/sell advice.

Data Sources

• https://stockmc.xueqiu.com/202508/603663_20250822_BMYV.pdf
• Sanxiang Advanced Materials Co., Ltd.
• https://static.cninfo.com.cn/finalpage/2020-03-10/1207355980.PDF
• Triumph Science & Technology Co., Ltd. 2025 Annual Report
• Sanxiang Advanced Materials: Sanxiang Advanced Materials Co., Ltd. 2026 Semi-Annual Report_Stock Channel_Stockstar
• Sanxiang Advanced Materials Co., Ltd. 2026 First Quarter Report
• Sanxiang Advanced Materials (603663) A-share Financial Report-Publicly traded company
• Sanxiang Advanced Materials (603663) Earnings Forecast_F10_10jqka Financial Services Network
• Sanxiang Advanced Materials (603663) Individual Stock Capital Flow Query_Individual Stock Market_10jqka Finance
• Zheshang Securities-Sanxiang Advanced Materials (603663) Review Report: The Most Impressive Q1 Report Since Listing, Core Beneficiary of Hafnium Metal Price Increases-260425
• 603663 | Sanxiang Advanced Materials Co Ltd Stock Market - Investing.com
• "Sanxiang Advanced Materials" 603663.SH - Sanxiang Advanced Materials Co., Ltd. - Shanghai Stock Exchange Main Board - A-share - Pre-IPO
• Sanxiang Advanced Materials (603663)_Company Announcements_Sanxiang Advanced Materials: 2026 Semi-Annual Earnings Pre-Increase Announcement_Sina Finance_Sina.com
• Sanxiang Advanced Materials (603663)_Company Announcements_Sanxiang Advanced Materials: 2026 Semi-Annual Report_Sina Finance_Sina.com
• Sanxiang Advanced Materials (603663)_Company Announcements_Sanxiang Advanced Materials: Announcement on Release of Part of Controlling Shareholder's Pledged Shares_Sina Finance_Sina.com
• Sanxiang Advanced Materials (603663)_Company Announcements_Sanxiang Advanced Materials: Abnormal Stock Trading Fluctuation Announcement_Sina Finance_Sina.com
• Sanxiang Advanced Materials (603663)_Company Announcements_Sanxiang Advanced Materials: Implementation Announcement on Repurchase and Cancellation of Equity Incentive Restricted Shares_Sina Finance_Sina.com
• Stock Code: 603663　　Stock Abbreviation: Sanxiang Advanced Materials　　Announcement No.: 2026-016
• Sanxiang Advanced Materials (603663)_Company Announcements_Sanxiang Advanced Materials: Announcement on Adjusting Matters Related to the 2025 Stock Option and Restricted Stock Incentive Plan_Sina Finance_Sina.com
• Sanxiang Advanced Materials (603663)_Company Announcements_Sanxiang Advanced Materials: Meeting Materials for the First Extraordinary General Meeting of Shareholders in 2026_Sina Finance_Sina.com
• Sanxiang Advanced Materials (603663)_Company Announcements_Sanxiang Advanced Materials: Announcement on Cancellation of Certain Special Accounts for Raised Funds_Sina Finance_Sina.com
• Sanxiang Advanced Materials (603663)_Company Announcements_Sanxiang Advanced Materials: Announcement on Convening the 2026 Semi-Annual Earnings Briefing_Sina Finance_Sina.com
• Regulatory Inquiries | Shanghai Stock Exchange
• Sanxiang Advanced Materials (603663)_Stock Market, Market Homepage_China Finance Online
• Sanxiang Advanced Materials (603663) - Historical Trading Data | Dabanke.com
• Sanxiang Advanced Materials (603663) Stock Price Trend Technical Analysis_Future Forecast_Buy and Sell Operation Suggestions_Investing.com
• Sanxiang Advanced Materials (603663) Capital Flows_Individual Stock Market_10jqka Finance
• Single Stock Research
• Sanxiang Advanced Materials (603663) Latest Updates_F10_10jqka Financial Services Network

This report is automatically retrieved, compiled, and generated by AI based on public channel information. Information is as of the close on September 11, 2026 (15:00); September 12, 2026 is a Saturday, A-share market closed. There may be timeliness differences, and specific data should be based on the company's official announcements and authoritative data terminals. This report is solely for information compilation and research reference, does not constitute any investment advice, and investors should make independent judgments and bear investment risks themselves.