Quantitative Assessment of Industrial Chain Synergy Between Sanlipu (002876.SZ) and Fuyin New Materials

I have now collected sufficient information. Based on this data, I will conduct a systematic quantitative assessment of the industrial chain synergy between Sanlipu and Fuyin New Materials.

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is a leading enterprise in China’s polarizer industry, mainly engaged in the R&D, production, and sales of polarizer products[1]. Polarizers are core upstream materials in the semiconductor display industry chain: they are key components directly involved in display in liquid crystal displays (LCDs), and function as components to prevent reflection from light-emitting electrodes in organic light-emitting diode (OLED) displays[2]. The company’s main products include TFT series and black-and-white series polarizers, which are widely used in displays of consumer electronics such as mobile phones, computers, and LCD TVs, as well as displays of industrial control electronics such as automotive electronics, medical devices, and instruments[2].

is mainly engaged in the R&D, production, and sales of precision functional adhesive materials, precision functional foam, and precision functional film materials[3]. Among these, precision functional film materials mainly include optical/non-optical release films, various protective films, explosion-proof films, etc.[3] It is worth noting that Fuyin New Materials’ R&D projects include “Research on a Protective Film Specialized for Polarizer TAC Substrate Surfaces and Its Preparation Method”, with R&D investments of RMB 712,300 and RMB 389,600 in 2022 and 2023 respectively[3].

From the perspective of the industrial chain, the polarizers produced by Sanlipu are multi-layer structures composed of polarizing films (PVA), protective films (TAC), pressure-sensitive adhesive layers, release films, protective films, optical compensation films, etc.[4] The precision functional film materials (especially release films and protective films) produced by Fuyin New Materials highly match the upstream raw material needs of polarizers, placing the two companies in an upstream-downstream relationship within the same industrial chain.

Based on industrial chain synergy theory, I have constructed the following quantitative assessment framework:

Assessment Dimension	Core Indicators	Data Sources
Business Relevance	Cross-application Rate of Products, Matching Degree of R&D Projects	Company Announcements, Prospectuses
Financial Synergy Potential	Procurement Cost Saving Space, Revenue Growth Contribution Rate	Financial Reports, Industry Data
Supply Chain Synergy	Domestic Substitution Rate Improvement Space, Delivery Response Efficiency	Market Research Reports
Talent-Technology Synergy	Turnover Rate of Core Technical Teams, Patent Technology Sharing	Company Announcements, Public Information

The production of polarizers requires a variety of functional film materials, among which release films and protective films are one of the key raw materials. According to industry data, direct materials account for approximately 69%-74% of the cost structure of polarizers[5]. In the raw material structure, TAC films account for 56%, PVA films account for 16%, and protective films, pressure-sensitive adhesives, etc. account for 28%[6].

Fuyin New Materials’ precision functional film material business covers two major categories of products: release films and protective films, which highly match the raw material needs of polarizer production. From 2022 to 2024, Fuyin New Materials’ precision functional film material revenue was RMB 55.4471 million, RMB 63.9618 million, and RMB 103.6884 million respectively, accounting for 12.27%, 11.97%, and 14.36% of its main business revenue[3]. This business shows an accelerated growth trend, with year-on-year growth rates of 15.36% and 62.11% in 2023 and 2024 respectively[3].

Fuyin New Materials’ R&D project “Research on a Protective Film Specialized for Polarizer TAC Substrate Surfaces and Its Preparation Method” directly targets the key link of polarizer production. If this project can be successfully industrialized, it will realize domestic substitution for imported protective films, forming synergy with Sanlipu’s localization strategy.

According to a research report from Dongxing Securities, the core upstream film materials for polarizers (TAC films, PVA films) are currently monopolized by Japanese enterprises, and the market share of domestic enterprises is extremely low[6]. TAC films are monopolized by Japanese enterprises such as Fujifilm and Konica Minolta, while the PVA film market is dominated by two Japanese enterprises, Kuraray and Synthetic Chemical Industry, with Kuraray accounting for approximately 70%-80% of global production capacity[6]. This provides huge space for domestic substitution through industrial chain synergy between Fuyin New Materials and Sanlipu.

According to Sanlipu’s 2024 annual report, the company’s direct material cost accounts for 74.29% of its operating costs, amounting to approximately RMB 1.591 billion[2]. Assuming Fuyin New Materials can supply 10% of its release film and protective film needs, the potential procurement amount can reach approximately RMB 119 million.

According to market research data, the prices of release films and protective films purchased by domestic polarizer manufacturers from Japan are usually 15%-30% higher than those of domestic similar products[6]. If domestic substitution is realized, Sanlipu’s procurement costs are expected to be reduced by 15%-30%, corresponding to cost savings of approximately RMB 17.85 million to RMB 35.7 million.

From Fuyin New Materials’ perspective, if it successfully enters Sanlipu’s supplier system and forms a stable supply relationship, it can conservatively estimate to obtain 20%-30% of Sanlipu’s annual procurement amount as revenue contribution. Based on the aforementioned procurement base of RMB 119 million, Fuyin New Materials’ sales revenue to Sanlipu can reach RMB 23.8 million to RMB 35.7 million, equivalent to 23%-34% of its 2024 precision functional film material revenue.

In 2024, Fuyin New Materials’ precision functional film material revenue grew by 62.11% year-on-year[3]. If it can successfully supply leading polarizer manufacturers such as Sanlipu, this business segment is expected to maintain a compound annual growth rate of over 50%.

Item	Conservative Estimate	Neutral Estimate	Optimistic Estimate
Fuyin New Materials’ Sales Revenue to Sanlipu	2,380	2,975	3,570
Sanlipu’s Procurement Cost Savings	1,785	2,677	3,570
Increase in Fuyin New Materials’ Revenue Growth Rate	+8pp	+12pp	+15pp
Sanlipu’s Gross Profit Margin Improvement Space	+0.5pp	+0.8pp	+1.2pp

Note: pp represents percentage points

According to data from the China Optics and Optoelectronics Manufacturers Association, global polarizer demand is expected to reach 594 million square meters in 2024, with a year-on-year growth of approximately 4.3%[2]. Benefiting from the concentration of panel production capacity in mainland China and the expansion of local manufacturers, the demand share in mainland China has further increased. According to Omdia’s forecast, mainland China’s polarizer production capacity will account for nearly 70% of global total production capacity in 2027[2].

However, the localization rate of key upstream film materials for polarizers is still very low. More than 80% of global TAC film production capacity is concentrated in Japan, and mainland China is highly dependent on imports of TFT-type TAC films[7]. The polarizer protective film and release film market is also dominated by Japanese manufacturers, providing broad space for domestic substitution.

As a leading domestic polarizer enterprise, Sanlipu has established a “Raw Material Localization” team to seek and cultivate key raw material suppliers in China[5]. If Fuyin New Materials can successfully enter Sanlipu’s supply chain, it will significantly improve the domestic substitution rate of polarizer protective films and release films.

Compared with imported material suppliers, domestic manufacturers have obvious advantages in delivery guarantee and service systems. According to the announcement of Guofeng New Materials, after the target company sent samples of polarizer release films to Hefei Sanlipu, the verification was completed in June, greatly shortening the verification cycle[8]. Relying on sufficient production capacity and stable supply chains, domestic suppliers can achieve rapid response to demand, with a faster response speed than imported material suppliers.

There is a significant talent flow relationship between the two companies:

: In June 2021, Zhang Jianfei, then Deputy General Manager and Chief Financial Officer of Sanlipu, signed a capital increase agreement with Fuyin New Materials, and completed the shareholding in March 2022. As of the pre-issuance period, he held 0.25% of Fuyin New Materials’ shares[3]. This investment behavior indicates the recognition of Fuyin New Materials’ business development prospects by Sanlipu’s senior management.

: From April 2021 to January 2022, Liu Tao served as the Production Deputy General Manager of Sanlipu; in January 2022, he joined Fuyin New Materials as the Operation Deputy General Manager, and in November 2023, he became the Deputy General Manager of Fuyin New Materials. In December 2023, he received equity incentives, with a shareholding of 155,100 shares[3]. Liu Tao’s production management experience at Sanlipu can be directly applied to the production of precision functional film materials at Fuyin New Materials, improving product quality and capacity utilization.

The transfer of technology and management experience brought about by this talent flow can significantly shorten the introduction cycle for Fuyin New Materials to enter the polarizer supply chain and reduce technology running-in costs.

Based on the above analysis, I have conducted a comprehensive score for the industrial chain synergy between Sanlipu and Fuyin New Materials (full score: 10):

Assessment Dimension	Weight	Score	Weighted Score
Business Relevance	25%	8.5	2.125
Financial Synergy Potential	30%	7.5	2.25
Supply Chain Synergy	25%	8.0	2.0
Talent-Technology Synergy	20%	7.0	1.4
Comprehensive Score	100%	-	7.775

The comprehensive score is approximately 7.78 out of 10, indicating that the two companies have strong industrial chain synergy.

1. Verification Progress Falling Short of Expectations
   : Fuyin New Materials’ polarizer protective film products are still in the R&D and small-batch supply stage, and large-scale supply requires customer verification.
2. Intensified Industry Competition
   : The release film and protective film market is highly competitive, and domestic manufacturers face dual challenges of technological breakthroughs and cost control.
3. Fluctuations in Downstream Demand
   : Polarizer demand is closely related to the prosperity of the panel industry, and there is a risk of cyclical fluctuations.

Based on the analysis of industrial chain synergy, it is recommended to pay attention to the following investment opportunities:

1. For Sanlipu
   : With the acceleration of domestic substitution, the company is expected to gradually reduce raw material procurement costs and improve profitability. It is recommended to pay attention to its capacity expansion progress and the introduction of localized suppliers.
2. For Fuyin New Materials
   : If it can successfully enter the supply chain of leading polarizer manufacturers such as Sanlipu, it will significantly enhance the growth potential of its precision functional film material business. It is recommended to pay attention to the verification progress and mass production capacity of its polarizer protective film products.

There is significant industrial chain synergy between Sanlipu and Fuyin New Materials. From the perspective of business relevance, Fuyin New Materials’ precision functional film materials highly match the raw material needs of Sanlipu’s polarizer production. From the perspective of financial synergy potential, domestic substitution can bring dual benefits of procurement cost savings and revenue growth to both parties. From the perspective of supply chain synergy, domestic suppliers have significant advantages in delivery response and service systems. From the perspective of talent-technology synergy, talent flow between the two companies is conducive to the transfer of technical experience and the rapid introduction into the supply chain.

Based on the comprehensive quantitative assessment, the industrial chain synergy score of the two companies is approximately 7.78 out of 10, which is a strong synergy level. With the acceleration of domestic substitution and the deepening of cooperation between the two parties, the industrial chain synergy is expected to be further released.

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[1] Sanlipu Company Announcement - Sina Finance

[2] Sanlipu 2024 Annual Report - 10jqka

[3] Industrial Chain Analysis of Fuyin New Materials - Futu NiuNiu

[4] Sanlipu Prospectus - Zhihu Column

[5] In-Depth Research Report on Sanlipu - Research Report

[6] In-Depth Report on Polarizer Industry: Accelerated Domestic Substitution and Incremental Opportunities for Medium and Large Sizes - Dongxing Securities

[7] Domestic Substitution Report on TAC Films - Western Securities

[8] Response to Guofeng New Materials’ Audit Inquiry Letter - 10jqka