Jiangsu Pacific Quartz Co., Ltd. (Quartz Shares) (603688)

Individual Stock Analysis Report　|　Industry: High-Purity Quartz Materials and Quartz Products　|　Report Date: September 13, 2026　|　Market data primarily through the September 11, 2026 close; some technical indicators, including MACD and RSI, use publicly available technical-indicator snapshots dated September 10, 2026; shareholder-structure data is as of June 30, 2026, based on the semiannual report and subject to a time lag.

This report was automatically compiled by AI based on publicly available information. It is for reference only and does not constitute investment advice.

1. Executive Summary

Quartz Shares currently exhibits the characteristics of “recovering revenue but still-pressured profit”: in the first half of 2026, operating revenue was RMB 546 million, up 6.00% year on year; net profit attributable to the parent was RMB 91.3753 million, down 14.47%; and non-GAAP net profit attributable to the parent was RMB 49.5553 million, down 19.14%. Second-quarter revenue was approximately RMB 289 million and net profit attributable to the parent approximately RMB 54.61 million. Profit improved sequentially, but higher costs and expenses and asset impairment continued to weigh on earnings. The company’s revenue mix is shifting from photovoltaic quartz sand toward fiber-optic, semiconductor and other businesses. In the first half of 2026, quartz tube and rod revenue was RMB 477 million, up approximately 12.24%, while quartz sand revenue declined approximately 28.20% year on year.

The company’s long-term investment thesis lies in its integrated layout spanning “high-purity quartz sand—quartz tubes, rods and components—downstream applications,” together with capabilities in purification, fusion processing, precision processing and customer certification. In 2025, fiber-optic and semiconductor revenue accounted for 53.61% of principal-business revenue, with a gross margin of 42.02%. However, photovoltaic revenue declined 40.46% year on year and its gross margin fell to 13.13%. Overall gross margin declined further from 45.96% in 2024 to 34.61% in 2025, indicating that the company remains in a transition phase in both business mix and earnings model.

The semiconductor business has made positive progress. The company disclosed that its furnace-tube high-purity quartz products manufactured using self-produced sand had passed certification by a domestic DRAM IDM manufacturer, while certification by domestic and overseas customers remains under way. However, the company also explicitly stated that certification does not equal volume supply. Customer names, order amounts, supply timing and revenue contribution have not been disclosed. In fiber optics, the company plans to advance construction of a new optical-fiber preform tube production line through its Baotou subsidiary, with completion expected by the end of 2026. Investment budget, planned capacity, orders and post-commissioning capacity utilization remain unclear.

As of September 11, 2026, the company’s share price was RMB 46.88, implying a dynamic P/E of approximately 184x and a non-GAAP P/E of approximately 386x. Static valuation was clearly elevated. Technically, the share price was below MA10 and MA20, while MACD remained in negative territory. In the short term, the stock was trading within an approximately RMB 44.5–48.0 range. Current valuation already reflects relatively high expectations for subsequent certification, volume ramp-up and earnings recovery in the semiconductor and fiber-optic businesses. A substantial risk remains that institutional forecasts may not be fully realized.

2. Company Overview

2.1 Basic Information

2.2 Main Businesses and Product Layout

• Fiber-optic and semiconductor business: revenue of RMB 516 million in 2025, accounting for 53.61% of principal-business revenue, up 3.24% year on year, with a gross margin of 42.02%.
• Photovoltaic business: revenue of RMB 227 million in 2025, accounting for 23.58% of principal-business revenue, down 40.46% year on year, with a gross margin of 13.13%.
• Light-source business: revenue of RMB 220 million in 2025, accounting for 22.81% of principal-business revenue, down 28.17% year on year, with a gross margin of 33.84%.
• By product, quartz tube and rod revenue was RMB 844 million in 2025, accounting for approximately 87.64% of principal-business revenue, with a gross margin of 34.60%; quartz sand revenue was RMB 114 million, accounting for approximately 11.86%, with a gross margin of 24.84%; quartz crucible revenue was RMB 4.82 million, accounting for approximately 0.50%, with a gross margin of 15.53%.
• Quartz tubes and rods serve multiple applications, including light sources, photovoltaics, fiber optics and semiconductors. Their revenue should not be treated entirely as semiconductor-business revenue.
• The company has formed an integrated layout of “high-purity quartz sand—quartz tubes/rods and quartz components—downstream applications,” extending into semiconductor quartz components, photovoltaic quartz materials, quartz products supporting fiber optics and special light-source materials.

2.3 Position in the Upstream and Downstream Value Chain and Cost-Profit Structure

Quartz Shares is positioned in the middle of the high-purity quartz materials and quartz-products value chain. It extends upstream into the purification of high-purity quartz sand and downstream into quartz products and applications in semiconductors, photovoltaics, fiber optics and light sources. Its core barriers are closer to high-purity quartz raw-material purification, fusion processing, precision processing, customer certification and integrated supply capabilities than to the mineral-reserve advantages of a traditional mining company.

• The company mainly purchases natural quartz ore, raw materials related to synthetic quartz, and the fuel, utilities, auxiliary materials and equipment required for production. Natural quartz ore undergoes crushing, screening, acid washing, purification, melting and further processing.
• Purchases from the top five suppliers totaled RMB 282 million in 2025, accounting for 56.96% of total annual purchases; none of the top five suppliers was a related party. Purchases from the second-largest supplier totaled RMB 52.4708 million, accounting for 10.60% of total purchases; purchases from the fifth-largest supplier totaled RMB 23.4406 million, accounting for 4.73%.
• Supplier concentration is not low, but no single supplier accounted for more than 50%; there is currently no evidence of extreme dependence on a single supplier. Disclosure of supplier names, specific ore sources, ore grades and long-term procurement-pricing mechanisms is insufficient, making it impossible to confirm that the company has significant upstream resource-pricing power.
• The company has not systematically disclosed its self-owned mining rights, recoverable reserves or ore-source structure for natural quartz ore. It should not be characterized as a resource company with substantial mineral reserves.
• In 2025 quartz tube and rod costs, direct materials accounted for 68.16%, labor 6.45%, manufacturing overhead 13.75% and fuel and utilities 11.63%; in quartz sand costs, direct materials accounted for 82.58%, labor 2.59%, manufacturing overhead 10.84% and fuel and utilities 3.99%.
• The quartz sand business is relatively sensitive to raw-material costs and product prices. Quartz tubes, rods and semiconductor quartz products are also affected by yield, equipment depreciation, labor, clean-room production and customer-certification costs.
• In a 2024 investor Q&A, the company disclosed high-purity quartz sand capacity of approximately 170,000 tonnes per year. However, this figure came from historical public Q&A and project-construction disclosures and was not reconfirmed in the 2025 annual report. It should not be directly treated as actual saleable or effective capacity in 2025.
• Downstream customers include semiconductor-equipment makers, wafer manufacturers, photovoltaic-cell and wafer companies, fiber-optic and optical-fiber-preform companies, and light-source and special-light-source manufacturers.
• Sales to the top five customers totaled RMB 275 million in 2025, accounting for 27.29% of total annual sales; there were no related-party sales, and no single customer accounted for more than 10%. This is based on the 2025 annual-report disclosure. Some customer names are anonymous, making it impossible to determine whether specific customers are large wafer manufacturers, photovoltaic leaders or equipment makers.
• Semiconductor customers have long certification cycles, strict product validation and high supplier-switching costs. Once a supplier enters the supply chain of international equipment makers or wafer manufacturers, a degree of customer stickiness exists. However, large equipment makers and wafer manufacturers impose stringent requirements for purity, particles, service life, stability and delivery capabilities and generally retain strong bargaining power.
• Photovoltaic products are relatively standardized. Industry capacity expansion can readily increase supply, resulting in substantial price competition. During 2024–2025, demand for and prices of photovoltaic high-purity quartz sand declined materially, and the company’s photovoltaic gross margin contracted sharply, indicating sensitivity to downstream industry conditions and supply-demand dynamics.
• Fiber-optic customers emphasize product consistency, low impurity levels, dimensional specifications and long-term stable supply, while supply-chain certification creates a degree of customer stickiness. In 2025, demand for related quartz auxiliary materials improved as computing networks, data centers, “dual-gigabit” construction and upgrades to ultra-low-loss fiber optics provided support.
• The company uses a direct-sales model and supplies customers through annual supply agreements, tender procurement and long-term cooperation. High-end semiconductor quartz materials have a degree of stickiness due to certification and switching costs, but downstream bargaining power varies by application.
• As of December 31, 2025, consolidated accounts receivable had a book balance of RMB 251 million, equivalent to approximately 24.9% of 2025 operating revenue of RMB 1.008 billion; carrying value was RMB 236 million, approximately 23.4% of operating revenue. Balances aged within one year were RMB 241 million, accounting for approximately 95.9% of accounts receivable. At year-end 2025, balances due from the top five accounts-receivable customers totaled RMB 79.5065 million, accounting for 31.70% of accounts receivable and contract-asset balances. Inventory carrying value was approximately RMB 1.089 billion, including raw-material book balance of RMB 594 million, finished-goods carrying value of RMB 350 million and self-manufactured semi-finished-goods carrying value of RMB 137 million. Net cash flow from operating activities was negative RMB 59.8350 million in 2025, compared with RMB 839 million in 2024. These figures indicate some working-capital occupation by receivables and inventory and do not yet fully reflect a strong buyer position. Inventory and pricing pressure in the photovoltaic business may be transmitted to midstream materials companies.
• Supply side: purchases from the top five suppliers accounted for 56.96% of total annual purchases in 2025; the second-largest supplier accounted for 10.60% and the fifth-largest for 4.73%, with no single supplier exceeding 50%. Demand side: sales to the top five customers accounted for 27.29% of total annual sales, with no single customer exceeding 10%. These concentration figures are based on 2025 disclosures. Supplier and customer names are partly anonymous, and their specific compositions cannot be further cross-checked. The latest annual report shall prevail.

The company is positioned in the middle of the high-purity quartz materials value chain, extending upstream into high-purity quartz sand purification and downstream into semiconductor, photovoltaic and fiber-optic quartz products. It belongs to the midstream processing and materials-manufacturing segment. Its profitability is driven not primarily by mineral reserves but by purification, fusion processing, customer certification and integrated supply capabilities. Short-term profit remains affected by photovoltaic quartz sand prices and supply-demand conditions. Medium- and long-term gross-margin improvement depends mainly on volume ramp-up following semiconductor quartz-material certification, stronger fiber-optic demand, a higher proportion of precision quartz products and a recovery in pricing power for high-purity quartz sand.

3. Financial Data and Valuation Analysis

3.1 Recent Operating Performance

As of September 13, 2026, the latest disclosed financial statement was the 2026 semiannual report, covering January 1 to June 30, 2026, and announced on August 22, 2026. Non-GAAP net profit attributable to the parent in the first half of 2026 was RMB 49.5553 million, down 19.14% year on year; total profit was RMB 101.895 million, down 12.62%; basic EPS was RMB 0.17, down 15.00%; weighted-average ROE was 1.56%, down 0.28 percentage points; and net cash flow from operating activities was RMB 26.9698 million, compared with negative RMB 87.97995 million in the same period of the prior year, turning positive year on year.

The latest financial report shows recovering revenue but pressured profit. Revenue growth in the first half of 2026 came mainly from increased sales of fiber-optic and semiconductor products. Profit declined mainly because of lower non-recurring gains and losses, higher operating costs and expenses, and increased asset-impairment provisions. By product, quartz tube and rod revenue was RMB 477.07 million, up approximately 12.24%, accounting for approximately 87.4% of operating revenue; quartz sand revenue was RMB 49.4623 million, down approximately 28.20%; quartz crucible revenue was RMB 2.6761 million, up approximately 14.90%; and other business revenue was RMB 16.5562 million. The revenue mix shows that the company is shifting from the pressured photovoltaic quartz sand business toward higher-value-added semiconductor and fiber-optic quartz materials, but earnings quality has not yet fully recovered.

3.2 Earnings Forecasts

Forecast data are from the Tonghuashun earnings-forecast page. As of September 11, 2026, the page showed six institutions making forecasts for the company’s 2026 results, although the currently visible detailed institutional list primarily displayed Huatai Securities, Guojin Securities, Northeast Securities and Zhongtai Securities, creating a discrepancy in the institutional-count definition. These figures are broker or terminal aggregation forecasts and are not formal company guidance. Visible institutional forecasts were as follows: Huatai Securities forecasts 2026–2028 net profit of RMB 290 million, RMB 638 million and RMB 946 million, with EPS of RMB 0.53, RMB 1.18 and RMB 1.75; Guojin Securities forecasts RMB 339 million, RMB 702 million and RMB 1.053 billion, with EPS of RMB 0.63, RMB 1.30 and RMB 1.94; Northeast Securities forecasts RMB 412 million, RMB 716 million and RMB 835 million, with EPS of RMB 0.76, RMB 1.32 and RMB 1.54; and Zhongtai Securities forecasts RMB 287 million, RMB 411 million and RMB 524 million, with EPS of RMB 0.53, RMB 0.76 and RMB 0.97.

3.3 Valuation and Institutional Ratings

As of the September 11, 2026 close, the share price was RMB 46.88, total market capitalization approximately RMB 25.3–25.4 billion, trailing P/E approximately 184x–186x, P/B approximately 4.32x–4.40x and trailing EPS approximately RMB 0.25. The 52-week price range was approximately RMB 34.74–89.50. Valuation data vary slightly across market-data terminals, likely because of differences in closing-price update times, trailing-profit definitions and data-refresh timing. Based on Huatai Securities’ latest forecasts, the current share price implies forward P/E ratios of approximately 88x, 40x and 27x for 2026–2028. Based on Tonghuashun’s institutional average EPS forecasts, the corresponding ratios are approximately 73x, 38x and 29x. The company’s current static valuation is clearly elevated, mainly because the profit base from 2025 through the first half of 2026 was low. If semiconductor and fiber-optic businesses ramp up and reach institutional earnings forecasts for 2027–2028, forward valuation would decline materially. If certification, volume ramp-up, or product-price recovery in the new businesses falls short, the current high P/E leaves substantial downside risk. Tonghuashun’s institutional-rating statistics for the past six months include three “Buy” ratings and four “Overweight” ratings, with zero “Neutral,” “Underweight” or “Sell” ratings. However, the count may include multiple reports from the same institution and should not be interpreted simply as consensus from seven fully independent institutions. As of September 11, 2026, Investing.com showed an average 12-month target price of approximately RMB 53.19 from two analysts, with a high of RMB 66 and a low of RMB 37; the overall rating was Buy. Given the limited analyst coverage, the reference value is relatively limited.

4. Recent News and Announcements

4.1 High-Purity Semiconductor Quartz Products Passed Certification by a Domestic DRAM IDM Manufacturer

On September 2, 2026, the company stated on the investor-interaction platform that its furnace-tube high-purity quartz products manufactured using self-produced sand had passed certification by a domestic IDM manufacturer with large-scale DRAM production capabilities, while certification by domestic and overseas customers continued. The company also explicitly cautioned that product certification does not mean volume supply has begun. Customer name, specific certified-product specifications, order amount, supply timing and expected revenue contribution were not disclosed, making it impossible to quantify the impact on operating results. The information came mainly from the investor-interaction platform and media reports; no formal standalone interim announcement by the company regarding this certification was identified.

4.2 Baotou Subsidiary Advancing Construction of a New Optical-Fiber Preform Tube Production Line

On September 4, 2026, the company stated on the investor-interaction platform that there were currently no plans for a new high-end optical-fiber preform tube production line at the Lianyungang base. The company was advancing construction of a new optical-fiber preform tube production line through its Baotou subsidiary, with completion expected by the end of 2026. The company has not disclosed the project investment budget, planned capacity, specific equipment investment or signed orders. Uncertainty remains regarding on-schedule commissioning and capacity utilization after commissioning.

4.3 Photovoltaic Business in a Period of Stage-Based Adjustment

On September 4, 2026, the company stated on the investor-interaction platform that the photovoltaic industry was currently in a period of stage-based adjustment, creating some short-term pressure on capacity utilization at its 60,000-tonne-per-year high-purity quartz sand production line. The company said that products from the line were not limited to photovoltaic applications and could also serve the semiconductor, fiber-optic and optical industries. Capacity utilization was expected to gradually recover as technology evolved and downstream applications expanded. The company did not disclose current actual capacity utilization, order volume or revenue from cross-industry conversion.

4.4 First-Half 2026 Operating Revenue Increased but Net Profit Attributable to the Parent Declined

The company disclosed its 2026 semiannual report on August 22, 2026. First-half operating revenue was RMB 546 million, up 6.00% year on year; net profit attributable to shareholders of the listed company was RMB 91.3753 million, down 14.47%; and non-GAAP net profit attributable to the parent was RMB 49.5553 million, down 19.14%. The company reported that the semiconductor business achieved steady growth due to the implementation of earlier certifications and product-mix optimization, but overall earnings continued to face pressure from costs, expenses and asset impairments. The company also disclosed that it would not distribute profits or convert capital reserves into share capital for the first half of 2026.

4.5 Asset-Impairment Provisions of RMB 27.1282 Million in the First Half of 2026

On August 22, 2026, the company disclosed an announcement regarding asset-impairment provisions for the first half of 2026. Total credit-impairment losses and asset-impairment losses recognized in the first half amounted to RMB 27.1282 million, including credit-impairment losses of RMB 3.9313 million and asset-impairment losses of RMB 23.1969 million, mainly inventory write-down provisions. The total reduced first-half 2026 profit before tax by RMB 27.1282 million. The company did not provide further details on inventory impairments by specific product or subsidiary. Subsequent inventory digestion and pricing pressure warrant monitoring.

4.6 2026 Semiannual Results Presentation Held

The company held its 2026 semiannual results presentation on August 25, 2026 and disclosed the event summary announcement on August 26. During the interaction, the company continued to emphasize progress in semiconductor high-purity quartz-material certification, construction of its optical-fiber preform tube business and adjustment of its photovoltaic business. It did not quantify semiconductor customer names, order amounts or revenue contribution and explicitly stated that certification does not equal volume supply.

4.7 Fourth Employee Shareholding Plan to Expire on February 15, 2027

On August 13, 2026, the company disclosed a reminder announcement that the term of its fourth employee shareholding plan was approaching expiration. The plan will expire on February 15, 2027. If it expires without extension, the employee shareholding plan will terminate automatically. Subject to relevant conditions and the completion of holder-meeting and board-review procedures, the term may be extended. The plan previously purchased an aggregate 1.491597 million company shares through the secondary market, representing approximately 0.41% of the company’s then-total share capital, at an average transaction price of approximately RMB 122.18 per share and total consideration of approximately RMB 182 million.

4.8 Holdings in the Special Share-Repurchase Account

As of June 30, 2026, the company’s special share-repurchase account held approximately 2.8183 million shares, representing approximately 0.52% of tradable shares, unchanged from the previous period. This figure comes from semiannual shareholder-holding statistics and does not indicate that a new repurchase occurred recently. As of September 13, 2026, no new share-repurchase plan, repurchase-progress announcement or repurchase-result announcement disclosed by the company between August and September 2026 was identified.

4.9 Changes Among the Top Ten Tradable Shareholders in the First Half of 2026

According to shareholder data as of June 30, 2026 disclosed in the semiannual report, Wang Zhaoying newly entered the top ten tradable shareholders, holding 2.1464 million shares, or approximately 0.40% of tradable shares; Robin Wood Industry increased its holding to 4.58 million shares, approximately 610,000 more than in the prior period; Qi Fucai reduced its holding to 4.1059 million shares, approximately 2.5925 million fewer than in the prior period; Hong Kong Securities Clearing Company Limited reduced its holding to approximately 3.5304 million shares, approximately 7.8478 million fewer than in the prior period; and Social Security Fund Portfolio 602 exited the top ten tradable shareholders, having held approximately 4.0201 million shares in the prior period. These figures reflect changes in the shareholder register at quarter-end and do not equal real-time trading activity by all shareholders.

4.10 Overall Shareholding Structure of the Controlling Shareholder and Actual Controller Largely Unchanged

As of June 30, 2026, the overall shareholding structure of the controlling shareholder and actual controller had not changed materially. Chen Shibin held approximately 144 million shares, representing approximately 26.56% of total company share capital; Futeng Development Co., Ltd. held approximately 123 million shares, representing approximately 22.70%. As of September 13, 2026, no separate announcement of an increase or reduction plan by the controlling shareholder or actual controller between August and September 2026 was identified.

4.11 No New Earnings Forecast, Major M&A or Regulatory Matters Identified

As of September 13, 2026, no new earnings forecast, earnings preannouncement, earnings flash or explicit earnings guidance for the first three quarters or full year of 2026 had been identified. No new major merger, acquisition of assets or major equity-investment announcement between August and September 2026 was identified. No new regulatory work letter, inquiry letter or disciplinary action issued by the Shanghai Stock Exchange against the company was identified. Historical regulatory measures previously taken against the company are not part of the latest developments from August to September 2026.

5. Share-Price Trend and Technical Analysis

5.1 Price Overview

5.2 Technical Indicators

As of September 11, 2026, Quartz Shares closed at RMB 46.88, in the lower-middle portion of its 52-week range of RMB 34.74–89.50. After pulling back from late-June highs, the stock rebounded from late July through late August but failed to break decisively above RMB 54 and declined again in early September. The share price is currently below MA10 and MA20, with MA5, MA10 and MA20 in a weak configuration. MACD remains negative, RSI is neutral, and the Bollinger-band position does not indicate extreme oversold conditions. The short-term technical structure is closer to weak range trading. Key levels to monitor are support at RMB 45.2–46.0, resistance at RMB 48.3–49.8 and whether turnover value expands for confirmation. Combined main-force capital flows were approximately flat, while the margin-financing balance represented approximately 4.06% of free-float market capitalization. The direction of incremental capital remains unclear.

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

⚠️ Risk warning: The following content is a subjective scenario analysis based on the September 11, 2026 closing data, historical prices and technical indicators. It does not constitute investment advice and does not represent a definitive judgment on future price direction or target prices.

① Key Technical Levels

② Scenarios for the Coming Week (Subjective Weighting, Not Statistical Probabilities)

• Range consolidation (relatively higher weight, approximately 60%; this is a subjective heuristic judgment based on the current technical picture and capital flows, not a statistical probability): The observation range is RMB 45.2–49.0. Trigger conditions include the share price holding the RMB 45.2–46.0 support area, turnover value remaining within the recent normal range of approximately RMB 500–800 million, no clear consecutive-day net outflow of main-force capital, and the share price retreating after rising near the RMB 48.3–49.8 resistance area. The share price is below MA10 and MA20, MACD is negative and capital flows are near neutral, but there is no extreme oversold condition. Horizontal consolidation above RMB 45 is therefore relatively consistent with the current technical structure.
• Weak decline (medium weight; a subjective judgment based on current technical, price-volume and margin-financing conditions, not a statistical probability): The observation range is RMB 42.0–45.2. If the closing price breaks decisively below RMB 45.0, while daily turnover value rises materially above recent averages and main-force capital records consecutive net outflows, or if the nonferrous-metals, nonmetallic-materials or semiconductor-materials sectors continue to weaken and margin-financing funds show signs of forced deleveraging, the stock may retreat toward RMB 42 and test the RMB 40.2–42.3 support area.
• Strong rebound (low-to-medium weight; a subjective judgment based on current technical and volume conditions, not a statistical probability): The observation range is RMB 49.0–52.3. Trigger conditions include the share price moving back above MA20 and the Bollinger middle band near RMB 48.3, then breaking above RMB 49.8 on higher volume and holding there over consecutive closes; daily turnover value rising to at least approximately RMB 1.0 billion; main-force capital shifting from recent near-flat flows to consecutive net inflows; and quartz-materials, semiconductor-materials or related electronics sectors strengthening in tandem. A low-volume rebound to RMB 48.3–49.8 without turnover confirmation would more likely represent a weak technical bounce.

③ Capital and Liquidity Background

As of September 11, 2026, average turnover value over the latest five trading days was approximately RMB 684 million and average turnover rate approximately 2.67%; over the latest ten trading days, the corresponding figures were approximately RMB 733 million and 2.82%. Daily turnover value was approximately RMB 555 million and the turnover rate was 2.21%. Quartz Shares is not an illiquid small-cap stock, but recent turnover value has declined materially from the late-August peak, indicating lower short-term market participation. According to the June 30, 2026 semiannual report, the top ten shareholders held approximately 57.85% in aggregate, including a combined 49.26% held by controlling shareholder Chen Shibin and Futeng Development Co., Ltd. Identifiable institutional or quasi-institutional holders among the top ten included Hong Kong Securities Clearing, the Southern CSI SWS Nonferrous Metals ETF and the National Social Security Fund, which had appeared during an earlier period. As of June 30, however, National Social Security Fund Portfolio 602 was no longer among the top ten. These shareholder data are subject to a quarterly time lag and the structure may have changed after June 30, 2026. In practice, high concentration means that some tradable shares are relatively concentrated, but continued institutional participation cannot be determined solely from the top ten shareholders. Short-term performance may still be affected by industry sentiment, margin-financing funds and incremental turnover.

If daily turnover value expands consecutively to above approximately RMB 1.0 billion and the share price simultaneously holds above RMB 49.8, this could be viewed as volume confirmation of a clear improvement in short-term capital participation. If turnover value remains below approximately RMB 700 million and the share price repeatedly encounters resistance at RMB 48.3–49.8, the stock would be more likely to remain range-bound or experience a weak technical rebound.

④ Key Points to Monitor (Observation Framework Only, Not Trading Instructions)

• Observe whether the RMB 45.2–46.0 area can stop the decline. If the stock breaks below RMB 45 on higher volume, continue monitoring the area around RMB 42 and the RMB 40.2–42.3 support zone. The above is an observation framework, not a trading instruction.
• Observe whether the stock can regain MA20 and the Bollinger middle band near RMB 48.3. The above is an observation framework, not a trading instruction.
• Observe whether RMB 49.8 can be broken and held with expanding turnover. Without volume confirmation, the sustainability of the rebound remains uncertain. The above is an observation framework, not a trading instruction.
• Monitor whether daily turnover value can rise from the recent normal range of RMB 500–800 million to above approximately RMB 1.0 billion, and assess price-volume coordination together with whether main-force capital records consecutive net inflows. The above is an observation framework, not a trading instruction.

The above scenario analysis is based on the September 11, 2026 closing data and estimates derived from historical prices and technical indicators. Short-term share-price performance may also be affected by news, capital flows, the broader market and other factors. Technical indicators themselves have lags and limitations. This does not guarantee future actual performance or constitute a buy or sell recommendation. Please make an independent judgment based on the latest market information and bear investment risks independently.

6. Industry Structure and Competitor Analysis

6.1 Industry Overview

High-purity quartz materials are mainly used in semiconductor diffusion and etching processes, as well as photovoltaic thermal fields, quartz crucibles, fiber-optic preforms and special light sources. Quartz Shares covers high-purity quartz sand, quartz tubes and rods and various quartz products. In 2025, fiber-optic and semiconductor revenue accounted for 53.61% of principal-business revenue. The company’s business focus is shifting from its previous reliance on photovoltaic quartz sand spreads toward relatively higher-value-added areas such as semiconductors and fiber optics.

6.2 Competitive Landscape

• Industry barriers include ore and raw-material purity, impurity control and batch consistency, high-purity quartz sand purification and melting processes, and the processing capabilities for large-size quartz tubes, rods, cylinders, rings and precision components.
• Long-term certification by semiconductor equipment makers and wafer manufacturers, product service life, particle control, cleanliness, delivery stability and customer supply-chain relationships are important competitive barriers.
• Ordinary photovoltaic quartz sand is more vulnerable to new capacity additions and experiences greater price volatility. Semiconductor-grade quartz materials and precision quartz components have long certification cycles and high technical and quality barriers, resulting in relatively concentrated competition. Fiber-optic quartz auxiliary materials emphasize long-term stable supply, low loss, dimensional specifications and customer certification.
• During 2024–2025, the photovoltaic industry was affected by supply-demand imbalance, destocking and capacity reduction. Quartz sand demand, prices and sales volumes came under pressure. Volume ramp-up following semiconductor-material certification, improving fiber-optic communications demand and product-mix upgrades are important directions for future profit improvement.
• The company’s publicly disclosed high-purity quartz sand capacity of approximately 170,000 tonnes per year came from 2024 investor Q&A and project-construction disclosures. It was not reconfirmed in the 2025 annual report and should be treated as historically disclosed planned capacity rather than actual effective capacity in 2025.
• The company has not systematically disclosed self-owned mining rights, recoverable reserves or resource self-sufficiency for natural quartz ore. Expressions such as “substantial resource reserves” or “high resource self-sufficiency” should therefore be avoided.

6.3 Major Competitors

Quartz Shares’ differentiation lies in its coverage of high-purity quartz sand, quartz tubes and rods and various quartz products, creating a relatively complete materials chain while serving semiconductor, photovoltaic, fiber-optic and light-source applications. Feilihua is more focused on high-end quartz-glass products, quartz fiber and aerospace materials; Kaide Quartz is more focused on semiconductor quartz components and downstream processing; and Triumph Science & Technology and Zhongqi New Materials represent potential competition in synthetic quartz, new materials and high-purity quartz sand, respectively. Because product specifications, process stages and downstream applications differ substantially, the companies above should be treated as segment-specific comparables or potential competitors rather than fully homogeneous competitors.

7. Risk Factors

• Semiconductor certification-conversion risk: The company disclosed that its furnace-tube high-purity quartz products manufactured using self-produced sand had passed certification by a domestic DRAM IDM manufacturer, but it has not disclosed the customer name, order amount, supply timing or expected revenue contribution and explicitly stated that certification does not equal volume supply. If subsequent certification or volume introduction proceeds more slowly than expected, the semiconductor business may contribute less profit than the market expects.
• Photovoltaic business and inventory-impairment risk: In 2025, photovoltaic revenue declined 40.46% year on year and gross margin fell to 13.13%. In the first half of 2026, quartz sand revenue declined approximately 28.20% year on year, while short-term capacity utilization at the 60,000-tonne-per-year high-purity quartz sand line remained under pressure. The company recognized RMB 23.1969 million of asset-impairment provisions in the first half of 2026, mainly inventory write-down provisions. If photovoltaic product prices and inventory digestion remain under pressure, further impairment or earnings volatility may occur.
• Continued earnings deterioration risk: Overall gross margin declined from approximately 87.54% in 2023 to 45.96% in 2024 and further to 34.61% in 2025. In the first half of 2026, revenue increased year on year but net profit attributable to the parent declined 14.47% and non-GAAP net profit attributable to the parent declined 19.14%. If revenue recovery does not translate into corresponding profit growth, expectations for earnings recovery may fail.
• Fiber-optic preform tube project construction and capacity-utilization risk: The company plans to advance construction of a new optical-fiber preform tube production line through its Baotou subsidiary, expected to be completed by the end of 2026. It has not disclosed the investment budget, planned capacity, specific equipment investment or signed orders. Uncertainty remains regarding on-schedule commissioning, post-commissioning capacity utilization and revenue contribution.
• Working-capital and cash-flow risk: At the end of 2025, accounts receivable had a book balance of RMB 251 million and inventory a carrying value of approximately RMB 1.089 billion. Net cash flow from operating activities was negative RMB 59.8350 million in 2025, a material weakening from RMB 839 million in 2024. If customer collections, inventory turnover or photovoltaic product prices improve less than expected, cash may remain tied up and impairment pressure may increase.
• Raw-material supply and cost-volatility risk: Purchases from the top five suppliers accounted for 56.96% of total annual purchases in 2025, indicating non-trivial supplier concentration. Direct materials accounted for 68.16% of quartz tube and rod costs and 82.58% of quartz sand costs. The company has not systematically disclosed ore-source structure, specific ore grades or long-term procurement-pricing mechanisms. Changes in raw-material prices, quality stability or supply structure may affect production costs and product yields.
• Valuation drawdown risk: As of September 11, 2026, the share price was RMB 46.88, implying a dynamic P/E of approximately 184x and a non-GAAP P/E of approximately 386x. Valuation is high. If semiconductor certification volume ramp-up, fiber-optic business expansion or earnings recovery falls short of institutional forecasts, the current valuation may face significant adjustment pressure.
• Short-term technical and margin-financing volatility risk: The share price is below MA10 and MA20, MACD is negative and recent combined main-force capital flows were essentially flat. The margin-financing balance was approximately RMB 1.030 billion, or approximately 4.06% of free-float market capitalization. If the share price breaks support near RMB 45 and triggers margin-financing deleveraging, short-term price volatility may increase.

8. Conclusion and Outlook

The company’s growth drivers mainly include volume ramp-up following semiconductor high-purity quartz-material certification, improving demand related to fiber-optic communications, construction of the new optical-fiber preform tube production line and a higher proportion of precision quartz products. In the first half of 2026, revenue from fiber-optic and semiconductor products increased, while net cash flow from operating activities turned positive at RMB 26.9698 million from a negative figure in the same period of the prior year, indicating some improvement in operating quality. However, the photovoltaic quartz sand business remains in a stage-based adjustment period, and short-term capacity utilization at the 60,000-tonne-per-year line is under pressure. The sustainability of earnings recovery depends on whether higher-value-added businesses can generate quantifiable orders and profit contributions.

Institutional average forecasts for 2026–2028 net profit attributable to the parent are approximately RMB 346 million, RMB 661 million and RMB 886 million, respectively. The low earnings base implies high forecast growth rates. If semiconductor and fiber-optic businesses achieve certification and volume ramp-up as expected, current valuation may gradually be absorbed by earnings growth. Conversely, if the pace of converting certification into volume supply, photovoltaic inventory digestion or product-price recovery falls short, the company’s currently high static and forward valuations may require reassessment.

Overall, Quartz Shares is at a critical stage of transitioning from a business driven by the photovoltaic cycle toward higher-value-added semiconductor and fiber-optic businesses. Technical and customer-certification barriers provide medium- and long-term support, but short-term results have not yet fully validated the success of the transition. Key items to monitor are whether semiconductor certification converts into volume orders, whether the optical-fiber preform tube line is commissioned on schedule and achieves effective utilization, whether photovoltaic quartz sand inventory and impairment pressure ease, and whether profit growth becomes commensurate with the high valuation.

Data Sources

• Quartz Shares (603688)_Company Announcements_Quartz Shares: 2025 Annual Report Summary_Sina Finance_Sina.com
• Quartz Shares (603688)_Company Announcements_Quartz Shares: 2025 Annual Report_Sina Finance_Sina.com
• Quartz Shares (603688)_Company Announcements_Quartz Shares: 2025 Annual Report_Sina Finance_Sina.com
• Quartz Shares (603688)_Company Announcements_Quartz Shares: Announcement on the 2024 First-Quarter Results Presentation_Sina Finance_Sina.com
• Quartz Shares (603688)_Company Announcements_Quartz Shares: 2024 Annual Report_Sina Finance_Sina.com
• Quartz Shares (603688)_Company Announcements_Quartz Shares: 2025 Annual Report_Sina Finance_Sina.com
• Quartz Shares: 2023 net profit up 378.92% year on year; proposed 10-for-5 stock conversion and RMB 57 cash dividend per 10 shares|Quartz Shares_Sina Finance
• Hubei Feilihua Quartz Glass Co., Ltd. 2024 Annual Report
• Triumph Science & Technology Co., Ltd. 2024 Annual Report
• Kaide Quartz (920179)_Company Announcements_Kaide Quartz: 2025 Annual Report_Sina Finance_Sina.com
• Zhongqi New Materials (001212)_Company Announcements_Zhongqi New Materials: 2024 Annual Report_Sina Finance_Sina.com
• Company Announcements_Kaide Quartz: Prospectus_Sina Finance_Sina.com
• Quartz Shares (603688)_Company Announcements_Quartz Shares: 2026 Semiannual Report_Sina Finance_Sina.com
• Quartz Shares (603688) Earnings Forecast_F10_Tonghuashun Financial Services
• Quartz Shares (603688) Latest Results Report_Aijingu.com
• Quartz Shares (603688) Earnings Forecast_F10_Tonghuashun Financial Services
• Institutional Investment Ratings—Stocks—Sina Finance
• Quartz Shares (603688) Latest Stock Price and Market Data, Real-Time Chart, Stock Price Analysis and Forecast_Investing.com
• Quartz Shares (603688) Historical Stock Data: Historical Prices, Charts and Trends_Investing.com
• Quartz Shares (603688)_Stock Quotes and Market Data_CFI.cn
• List of Companies Listed on the Main Board of the Shanghai Stock Exchange
• Quartz Shares: Recently, high-purity quartz furnace-tube products manufactured using self-produced sand received certification from a domestic DRAM IDM manufacturer
• Quartz Shares (603688)_Stock Quotes_Securities Star
• Quartz Shares (603688)_Company Announcements_Quartz Shares: 2026 Semiannual Report_Sina Finance_Sina.com
• Quartz Shares (603688)_Company Announcements_Quartz Shares: Announcement on Asset-Impairment Provisions for the First Half of 2026_Sina Finance_Sina.com
• Quartz Shares (603688)_Company Announcements_Quartz Shares: Announcement on the 2026 Semiannual Results Presentation_Sina Finance_Sina.com
• Quartz Shares (603688)_Company Announcements_Quartz Shares: Reminder Announcement on the Approaching Expiration of the Fourth Employee Shareholding Plan_Sina Finance_Sina.com
• Stock Code: 603688  Stock Abbreviation: Quartz Shares  Announcement No.: Lin 2026-002
• Quartz Shares’ top ten tradable shareholders change: Wang Zhaoying newly enters, Social Security Fund Portfolio 602 exits, Robin Wood Industry increases holdings, Qi Fucai and others reduce holdings_Sina Finance
• Quartz Shares (603688)—Detailed Share Capital and Shareholders
• [Shanghai Stock Exchange

SSE Public Supervision Letter [2023] No. 0250

Regarding Jiangsu Pacific Quartz Co., Ltd. and relevant responsible persons](https://www.sse.com.cn/disclosure/credibility/supervision/measures/focus/c/10747943/files/cc091c1a3b2e4e7fbceb09804cb19345.pdf?utm_source=openai)

• Quartz Shares (603688)_Company Announcements_Quartz Shares: 2026 Semiannual Report Summary_Sina Finance_Sina.com
• Quartz Shares (603688)—Historical Trading Data | Dabaike.com
• Quartz Shares (603688) Stock Price Trend and Technical Analysis_Future Forecast_Buy/Sell Recommendations_Investing.com
• Quartz Shares (603688) Stock Price Trend and Technical Analysis_Future Forecast_Buy/Sell Recommendations_Investing.com
• Quartz Shares (603688)_Capital Flows_Securities Star
• Quartz Shares (603688)_Stock News_Sina Finance_Sina.com

This report was automatically retrieved, compiled and generated by AI based on publicly available information. Information is current through the market data primarily available at the September 11, 2026 close; certain technical indicators, including MACD and RSI, use publicly available technical-indicator snapshots dated September 10, 2026, while shareholder-structure data is based on the June 30, 2026 semiannual report and is subject to a time lag. Timing discrepancies may exist. Specific data should be based on the company’s formal announcements and authoritative data terminals. This report is for information organization and research reference only and does not constitute investment advice. Investors should make independent judgments and bear investment risks independently.