When the industry winter meets a strategic layout of a hundred billion level, this chemical giant is playing a surprising big game!

On March 17, Wanhua Chemical presented a 'bittersweet' annual report: it achieved a record high revenue of 182.069 billion yuan in 2024, but its net profit dropped by 22.49% year-on-year. Just as the market was abuzz with discussions, the company unveiled 11 major new material industry layouts at the beginning of 2025, revealing its ambition for counter-cyclical expansion.

Under the seemingly declining net profit curve, Wanhua Chemical is completing a key transformation. Despite the pressure on the price of its main product MDI, through measures such as the commissioning of a 1.8 million tons/year MDI technical renovation project and the full integration of the vitamin A industry chain, the company has managed to maintain an overall gross margin that is basically flat in the industry's winter. More noteworthy is the growth in sales expenses, which is backed by strategic investments such as the commissioning of a 400,000 tons POE project and the establishment of the world's largest 48,000 tons citral facility.

Optical material duo: 480,000 tons of PC production capacity continuously boosting high-end applications, 160,000 tons of PMMA breaking the foreign monopoly on optical-grade materials. Medical-grade PC and high-refractive-index PC have been applied in the fields of 5G base stations and new energy vehicles.
(2) New Energy's Ace in the Hole: The first phase of 200,000 tons of POE has been put into production, and the second phase of 400,000 tons is in full swing. It is expected that after the completion in 2025, it will occupy 25% of the global market share, directly targeting the domestic substitution of photovoltaic film.
(3) Chip-level breakthrough: The electronic special gas project has achieved mass production of 5N grade disilane, and a 140-ton silane project is about to start production, signaling hope for the breakthrough of domestic semiconductor materials.
(4) New forces in biomedicine: the world's first full industrial chain technology for nylon 12 has been implemented, PEBA elastomers have entered the supply chain of international sports brands; medical-grade polysulfone materials have broken through the core technology of dialysis membranes.
(5) Future material reserves: COC/COP optical materials have been successfully tested at the pilot scale, and MS resin is about to break the monopoly of Japan and the United States. These strategic materials, listed on the national 'chokepoint' list, are about to reach a turning point in domestic production.

From total assets of 293.3 billion to the three super bases under construction in Penglai, Yantai, and Ningbo, Wanhua Chemical's expansion map aligns with the national strategy: in traditional advantageous areas such as MDI, maintaining the global leading position through technological upgrades; in the new materials sector, precisely targeting细分领域精准发力。其研发投入连续5年保持20%增速，2024年更是将净利润的15%投入创新研发。 segments with an import substitution rate of less than 30%. Its R&D investment has maintained a 20% growth rate for five consecutive years, and in 2024, it will invest 15% of its net profit into innovative R&D.

Four, the Dangers and Opportunities in Industry Shakeup
Despite the pressure on short-term performance, Wanhua Chemical's inventory turnover days decreased by 8 days year-over-year, and operating cash flow increased by 12%, demonstrating strong operational resilience. As projects under construction, such as the 500,000-ton SAP and 300,000-ton high-end polyolefins, come into production one after another, analysts predict that the revenue share of its new materials sector is expected to exceed 40% by 2025.

When the industry is still debating the turning point of the cycle, Wanhua Chemical has quietly completed its transformation from an 'MDI giant' to a 'new materials empire'. Behind this bold bet lies not only a company's strategic choice but also reflects the collective breakthrough of China's chemical industry towards a high-end value chain. In the race where the global new materials market size is expected to exceed 6 trillion US dollars by 2025, Wanhua Chemical's grand game has just begun.