In November 2025, the silicone capital market experienced a strong breakout, with multiple rounds of limit-up surges, making it the undisputed "star sector" of the chemical industry.
On November 7th, silicone concept stocks led the charge with a limit-up surge, and the overall sector gained more than 5%. Dongyue Silicone and Ruitai New Materials led the way with a 20% limit-up, while industry leaders such as Jiangsu Guotai and Hesheng Silicon Industry also achieved 10% limit-ups. Over 80% of stocks in the sector saw gains.
Just three days later, on November 10th, sector enthusiasm further escalated, with the overall gain exceeding 6%. Sanfu Co. and Luxi Chemical followed suit with limit-up surges, while the previous leader, Dongyue Silicone, soared over 12%, with a two-day cumulative gain of nearly 40%.
The current rally is not coincidental. Several favorable factors have created a resonance.
Positive Industry Fundamentals: Supply-Demand Improvement Expectations Continue to Rise
The industry's previously rumored production reduction plans have sparked market expectations for the alleviation of excess capacity, improving the supply-demand balance.
Solar Industry Integration Boosts Silicone Demand
Although recent capacity integration efforts in the solar industry do not directly involve silicone, as a major application area for silicone, the industry's increasing concentration is expected to optimize upstream material demand.
Positive Signals from Industry Leaders Boost Market Confidence
At a recent earnings call, industry leader Xingfa Group released positive signals, with executives stating that with the implementation of production cuts and a recovery in demand, core silicone product prices are expected to move out of the bottom range in 2026. This statement significantly boosted market confidence.
Institutional analysts pointed out that the silicone sector's valuation remains at historically low levels. With improvements in supply-demand dynamics and breakthroughs in emerging applications, the sector is expected to see continued valuation recovery.
