Photovoltaic industry hopes to welcome recovery investment and merger and acquisition is quietly active-Shanghai Metals Market

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Photovoltaic industry hopes to welcome recovery investment and merger and acquisition is quietly active

Translation 08:33:02AM Jun 18, 2019 Source:Securities Times

SMM News: "actively promote affordable Internet projects, give priority to the construction of projects with low subsidy intensity and strong retrogression, and adopt competitive allocation for projects that need to be subsidized by the state." With the recent release of this is known as the most market-oriented policy, the photovoltaic industry "to subsidize", "market-oriented competition", "affordable access to the Internet" direction has been clear, the industry is also expected to usher in a significant recovery.

At the same time, according to the investigation, in order to deal with the established development trend of "affordable Internet" in the industry, better transition from the state of relying on subsidies to a state of market-oriented competition, and stand out in the new round of opportunities for the development of the photovoltaic industry, the industry enterprises have long been waiting for it. Under the policy, the photovoltaic field investment, M & A, expansion of production, going out to sea, entering the bureau of state capital and so on frequently.

The industry hopes to usher in a recovery

From last year's "531" photovoltaic control target, the new policy of reducing subsidies landed about a year, the photovoltaic industry to meet a stronger retreat of the new policy. Recently, the National Energy Administration issued the Circular on matters related to the Construction of Wind Power and Photovoltaic Power Generation projects in 2019 (hereinafter referred to as the Circular), which makes it clear that classified management will be implemented for the construction of photovoltaic power generation projects in 2019. competitive allocation of projects that need to be subsidized by the state, actively promote the construction of affordable Internet projects, and give priority to the construction of projects with low subsidy intensity and strong retrogression.

In this regard, Guangfa Securities analyst Chen Zikun said that the landing of the new photovoltaic policy has provided clear policy support for the domestic photovoltaic construction work in 2019, and the photovoltaic industry has also entered a new stage in which the market mechanism determines the allocation of resources, and the certainty of the future development of the industry has been greatly improved.

"with the landing of the new photovoltaic policy, the photovoltaic market is expected to recover, and the supply and demand pattern of each link of the industrial chain will be tight in stages, in which silicon materials, silicon chips, and other links have strong power to raise prices, and the company is positioned as a manufacturer of photovoltaic raw materials, which has a positive impact on the future development of the company." Tianlong photoelectric related person in charge to the Securities Times e company reporter said.

Tuorixineng also said that as a new energy source for sustainable development in the future, the photovoltaic industry is expected to achieve performance growth in 2019, and the development prospect is clear. In the short term, after the introduction of the policy, the domestic market demand will be gradually released, manufacturing photovoltaic enterprises will also usher in a wave of new orders, at the same time, the demand structure of the photovoltaic market will change from the Chinese market to the overseas market in 2019; in the long run, the photovoltaic industry into the affordable era will open up more market space, the industry prospects are considerable.

As for the installed capacity, Soochow Securities believes that the domestic market will be officially launched in the second half of the year, overseas will also enter the traditional peak season, maintaining the previous domestic new installed capacity 45-50GW, global new installed capacity 130GW installation target. According to the China Photovoltaic Industry Association, the new installed capacity of photovoltaic power generation in China exceeded 43GW in 2018, down 18% from the same period last year, and the cumulative installed capacity exceeded 170GW. In the new installed capacity, the centralized photovoltaic power station is about 23GW, down 31% from the same period last year, and the distributed photovoltaic power station is about 20GW, up 5% from the same period last year.

Some brokerage analysts also pointed out that the landing of the new deal is expected to promote the demand for new installed capacity of domestic photovoltaic in the second half of the year, and it is expected that with the approach of affordable Internet access, the photovoltaic industry is expected to usher in a "golden decade"; among them, 2019-2020 is the transitional stage of domestic affordable Internet access, and the links of batteries and components will become the main position for the current round of photovoltaic industry to reduce costs and increase efficiency, and is expected to obtain sustained capital investment in the industry.

Looking back at 2018, under the influence of last year's photovoltaic "limited scale, limited targets, reduced subsidies", the operating conditions of photovoltaic enterprises have taken a sharp turn for the worse, many enterprises have been forced to stop production, and many photovoltaic enterprises have experienced negative net profit growth during the year, and the industry has been hard hit.

The arrival of affordable Internet access is accelerated.

It is understood that since the 13th five-year Plan, the application scale of photovoltaic power generation in China has been continuously expanded, the technical level has been significantly improved, and the cost has dropped significantly. By the end of the first quarter of this year, China's photovoltaic power generation capacity has reached 180 million kilowatts, with an annual generating capacity of 177.5 billion kilowatt hours, ranking first in the world for many years in a row, but at the same time, the subsidy gap has continued to expand, and some areas have abandoned light and limited power, and other problems have become increasingly prominent.

In this context, on May 31 last year, the National Energy Administration issued the strictest photovoltaic policy in the history of photovoltaic development, making it clear that photovoltaic development will be limited in scale, electricity price, and subsidies. This policy has also been complained and resisted by the industry, known as the "Photovoltaic 531 New deal." At the beginning of this year, the National Energy Administration issued the Circular on actively promoting the work of Wind Power and Photovoltaic Power Generation without subsidy, clearly proposing the construction of affordable Internet access projects and low-cost Internet access pilot projects, improve the competitive allocation mechanism of projects that require state subsidies, and reduce the dependence of industry development on state subsidies. Subsequently, the National Energy Administration has also repeatedly for affordable access to the Internet, competitive configuration and other symposiums, issued to solicit opinions, and so on, continue to release the photovoltaic industry market-oriented signal.

In 2019, the total subsidy budget for new photovoltaic projects in China is 3 billion yuan, of which 750 million is used for household photovoltaic (equivalent to 3.5 million kilowatts) and 2.25 billion for competitive bidding projects (excluding photovoltaic poverty alleviation). The "notice" supporting document "2019 photovoltaic project construction work plan" has been clearly defined, 2019 new photovoltaic project subsidy budget is 3 billion yuan, of which 750 million is for household photovoltaic (equivalent to 3.5 million kilowatts) and 2.25 billion for competitive bidding projects (excluding photovoltaic poverty alleviation). Implying that the total amount of photovoltaic subsidies this year is fixed, but the implementation of competitive allocation, give priority to affordable Internet projects.

Gao Jifan, co-chairman of the Global Solar Council and chairman of the China Photovoltaic Industry Association, believes that due to the rapid decline in photovoltaic costs, the overall growth of overseas markets in 2019, and the rapid recovery of the EU market, the demand of the US market has rebounded sharply on the basis of last year, and the development momentum of Southeast Asia, Latin America, the Middle East, and other countries and regions is also very rapid, and the trend of diversification of the photovoltaic market is becoming more and more obvious. "it is expected that the installed capacity in the overseas market will increase significantly from last year's 60GW to about 85GW, and the domestic market will also show recovery growth."

"after more than 20 years of development, the cost of photovoltaic power generation has been reduced to the original 1-2019, and 2019 will be a milestone in the history of photovoltaic development-from then on, the global photovoltaic will quickly enter the era of comprehensive parity. Photovoltaic industry will also move from youth to youth, photovoltaic energy will gradually move towards the center of the energy stage. " At the recent SNEC Global Photovoltaic Conference, Wang Bohua, vice chairman and secretary general of the China Photovoltaic Industry Association, said so.

Enterprises have been practicing their internal skills one after another.

After a round of policies have been issued, the industry has generally realized that the days when they relied mainly on state subsidies for development in the past are gone forever, and if enterprises want to make great progress in the photovoltaic field in the future, they must strive to reduce costs and finally achieve affordable access to the Internet. Therefore, in the face of this year's market-oriented new policy, photovoltaic enterprises have become much more rational.

"the landing of the new photovoltaic policy will accelerate the elimination of backward production capacity in the photovoltaic industry, and the concentration of industry resources to outstanding competitors is obvious, requiring the manufacturing side to place more emphasis on modern lean manufacturing, which is conducive to the development of the company and the industry from a medium to long-term point of view." The relevant person in charge of easy special told the securities times e company that as early as this year before the new photovoltaic policy landed, easy special has increased the deployment of photovoltaic power stations, which will provide a stable source of profit for the company, at the same time, the company is actively promoting household photovoltaic, poverty alleviation photovoltaic and industrial and commercial distributed photovoltaic development of major businesses, but also in line with the guidance of the new policy.

"in the transition period of affordable access to the Internet, enterprises have to face two problems: the first is how to persist until the arrival of the affordable era, and the second is to practice internal skills, that is, to ensure quality and control costs." Costa said bluntly that for the affordable Internet project, Costa has invested a lot of manpower, material and financial resources around the core equipment photovoltaic inverter. The power grade, power density, heat dissipation capacity, reliability, stability and voltage grade and capacity ratio of the product have always been the focus of Costa research.

Xiexin integration plan reduces costs in a variety of ways. When the company recently accepted institutional research, it said that in the field of silicon materials, silicon chips, and battery components, the space for further reduction in costs is limited due to the influence of commodity and manufacturing cost factors, and there is a need to further increase technical investment in the future. by improving the conversion efficiency of cells and components, increasing the power generation per unit photovoltaic modules, amortizing the investment cost of photovoltaic power stations, so as to achieve the purpose of affordable access to the Internet; At the same time, in terms of non-technical cost restrictions, domestic land costs, financing costs, tax costs are relatively high, in the future hope to further reduce the financing costs of enterprises, in order to reduce the investment cost of photovoltaic power plants.

In the face of the New deal, hard work seems to have become the consensus of the photovoltaic industry. Dongfang Risheng also revealed that in promoting the realization of affordable Internet access, the company will continue to improve the efficiency of battery components, optimize the structure of battery components, strengthen product quality, and strive to bring highly reliable, efficient and cost-effective photovoltaic products to users around the world.

Some companies even hammered out affordable online schedules as early as a year ago. In an interview with the Securities Times e Company in August last year, Sunshine Power supply said that in areas where the light is very good, the company has achieved or is close to achieving affordable Internet access, and after several years of efforts, the company photovoltaic power generation will soon be able to achieve full parity online, in two or three years.

Active Investment and merger in the Industry

At a time when the trend of the industry is clear, investment and mergers and acquisitions in the photovoltaic field have been quietly active, and a new round of industrial integration in the industry has also begun.

According to the incomplete statistics of the reporter of Securities Times e Company, dozens of photovoltaic investment and mergers and acquisitions projects have taken place in the capital market since this year, and since June, the relevant cases have emerged one after another, and many enterprises with state-owned assets have also accelerated to enter the market one after another.

Hong Kong shares disclosed that Tower Energy Co., Ltd., a wholly owned subsidiary of photovoltaic, mobile power generation, energy storage services and wind power, was officially registered on June 5, 2019 with a registered capital of 5 billion yuan. This means that China Tower, a central enterprise, has officially entered the photovoltaic field.

On the same day, Societe Generale and its holding subsidiary Societe Generale announced at the same time that Societe Generale had conditionally agreed to issue more than 1.687 billion subscription shares to Shandong State Capital Water Development Group (Hong Kong) holding Co., Ltd., involving a capital of more than 1.552 billion yuan. Upon completion of the subscription, Shuifa Hong Kong will hold 66.92% of the shares of the listed company and indirectly hold more than 50% control of China Societe Generale New Materials Holdings Limited.

A day earlier, the photovoltaic sector has just ushered in a number of industry leaders in the trend of investment and mergers and acquisitions. Poly Xiexin, the world's largest polysilicon enterprise and the world's largest wafer manufacturer, disclosed on June 4 that it plans to sell its 51% stake in Xiexin New Energy to Huaneng Group, a subsidiary of China Huaneng Group. On the same day, Longji shares, the world's two leading single crystal product manufacturers, and Tongwei shares, the world's largest solar cell manufacturer, announced the formal signing of a strategic cooperation agreement, specifically: Longji shares strategy to take a stake in Tongwei Baotou 50,000 tons of high pure silicon project, holding a 30% stake in the project; At the same time, Tongwei shares strategy to take a stake in Longji Ningxia Yinchuan 15GW single crystal silicon rod and wafer project, holding a 30% stake.

The first cross-ownership between the leaders is meaningful. "the cost requirement of the parity project is particularly high. If the two leading enterprises cooperate and complement each other in the industrial chain, and reduce the cost of the battery wafer and silicon wafer to the lowest, they can reduce the cost and increase the efficiency. Of course, this will also hedge some of the non-technical costs such as financing. " Tongwei shares in charge of the evaluation of the cooperation.

Mergers and acquisitions in similar industries are not uncommon. The reporter found that before this, Aikang Science and Technology, Luxiao Technology, Jingao Solar Energy, Tianhe Light Energy, China Power, China Power Photovoltaic and other photovoltaic enterprises have also announced the trend of relevant investment and mergers and acquisitions, and the heat of investment and mergers and acquisitions in the photovoltaic field has increased significantly.

Lu Bing, an expert on mergers and acquisitions in the Chinese energy industry of PricewaterhouseCoopers, pointed out that in the future, large and medium-sized enterprises in the industry will rely more on mergers and acquisitions to increase their installed capacity, while small enterprises in the industry will be affected by the postponement of payment of state subsidies and operating risks, resulting in greater pressure on cash flow, and it is possible to withdraw through the sale of assets, and the concentration of the industry will be further enhanced.

"at present, China's photovoltaic industry is showing two major trends, one is that the integration and reshuffle has always continued, and the industry concentration has been increasing; the other is that the elimination of backward production capacity by high efficiency capacity continues to accelerate." Tongwei executives believe.

Full enterprise orders

Behind the warming of investment is accompanied by the recovery of the industry and full orders from enterprises.

Securities Times e company investigation found that at present, Hengdian East Magnetic, Sunshine Energy, Longji shares, Tongwei shares, Central shares, Jingsheng mechatronics, Xiexin Integration and other photovoltaic companies have been in a state of full production and pin, some leading enterprises in the first half of 2019 orders have been full, behind the pull is mainly in the overseas market.

Take Xiexin Integration as an example, at present, the company has abundant orders in hand, which has been listed until the third quarter of this year. Xiexin integrated components shipped 4.56GW in 2018, of which 2.3GW was shipped overseas and the proportion of overseas business rose to 52.9%. In the first quarter of this year, the proportion of overseas market revenue has exceeded 70%, and the overall revenue of overseas business is expected to account for more than 70% of the total revenue for the whole year.

Looking at Sunshine Power supply, the company recently accepted institutional research, saying that orders in the first half of the year have been relatively full, mainly to meet the needs of foreign markets and some domestic stock power stations, and that the domestic inverter market will gradually start because of the design of bidding and bidding rules. At the same time, the global market share of its inverter has been steadily increasing.

Jingke Energy also revealed that the company's overseas market growth this year is very obvious, has been exported to more than 100 overseas countries, this year will continue to increase, the future will continue to expand overseas business market.

In addition, according to Anxin new observation, the top 10 domestic production capacity of component companies, the first half of 2019 orders have been signed, and even some enterprises have begun to sign orders for the third and fourth quarters, and most of the orders are from overseas markets.

A new round of production expansion is coming

Full orders directly gave birth to a new round of production expansion in the industry.

On the evening of June 15, Longji shares announced that Longji Leye Photovoltaic Technology Co., Ltd., a wholly owned subsidiary of Longji Leye Photovoltaic Technology Co., Ltd., signed a project investment agreement with the people's Government of Hailing District of Taizhou City, in which the company reached a cooperative intention to invest in the construction of an annual 5GW single crystal module project in Taizhou, with an investment of about 2.4 billion yuan. Longji said the investment will help to improve the production capacity of efficient single crystal products and further increase the market share of single crystals. It is worth mentioning that since the beginning of this year, Longji shares have thrown out a number of production expansion plans, involving a total of tens of billions of yuan.

Coincidentally, the Central shares also came out with a production expansion plan on May 30. the company said that it plans to invest 9.13 billion yuan in the fifth phase of the Central Xiexin project to build monocrystal silicon materials for renewable energy solar cells, with a new production capacity of 25GW. After the completion of the "Central Industrial Park," the overall production capacity will reach more than 55GW, becoming the largest production base of high-efficiency solar monocrystal silicon in the world, and the average annual sales income of the project after reaching production capacity is 7.3 billion yuan. The average annual profit is 1.2 billion yuan.

The expansion of photovoltaic industry seems to have quietly spread to the whole industry. According to the rough statistics of the reporter of Securities Times e Company, so far, Longji shares, Tongwei shares, Central shares, Poly Xiexin Energy, Jingke Energy, Fulet, Aerospace Machinery and Electrical and other companies have all announced production expansion.

It is worth mentioning that in the past development of the photovoltaic industry, every capacity expansion will give birth to the rise of giants. After precipitation, the photovoltaic industry has once again entered a new round of business cycle, ushered in the second wave of expansion tide, Jingke and other upstarts have come to the fore.

Shenzhen, a private equity person pointed out that it is expected that under this round of photovoltaic new policy, the competitiveness of the entire photovoltaic industry enterprises will be significantly enhanced, Chinese photovoltaic enterprises in the global market leading position will also be further consolidated, and with the subsequent domestic and international photovoltaic demand, industry costs are gradually falling, China's photovoltaic industry will usher in a new round of development climax, during this period, the leading enterprises in different industrial chains in the photovoltaic industry are worthy of attention.

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Photovoltaic industry hopes to welcome recovery investment and merger and acquisition is quietly active

Translation 08:33:02AM Jun 18, 2019 Source:Securities Times

SMM News: "actively promote affordable Internet projects, give priority to the construction of projects with low subsidy intensity and strong retrogression, and adopt competitive allocation for projects that need to be subsidized by the state." With the recent release of this is known as the most market-oriented policy, the photovoltaic industry "to subsidize", "market-oriented competition", "affordable access to the Internet" direction has been clear, the industry is also expected to usher in a significant recovery.

At the same time, according to the investigation, in order to deal with the established development trend of "affordable Internet" in the industry, better transition from the state of relying on subsidies to a state of market-oriented competition, and stand out in the new round of opportunities for the development of the photovoltaic industry, the industry enterprises have long been waiting for it. Under the policy, the photovoltaic field investment, M & A, expansion of production, going out to sea, entering the bureau of state capital and so on frequently.

The industry hopes to usher in a recovery

From last year's "531" photovoltaic control target, the new policy of reducing subsidies landed about a year, the photovoltaic industry to meet a stronger retreat of the new policy. Recently, the National Energy Administration issued the Circular on matters related to the Construction of Wind Power and Photovoltaic Power Generation projects in 2019 (hereinafter referred to as the Circular), which makes it clear that classified management will be implemented for the construction of photovoltaic power generation projects in 2019. competitive allocation of projects that need to be subsidized by the state, actively promote the construction of affordable Internet projects, and give priority to the construction of projects with low subsidy intensity and strong retrogression.

In this regard, Guangfa Securities analyst Chen Zikun said that the landing of the new photovoltaic policy has provided clear policy support for the domestic photovoltaic construction work in 2019, and the photovoltaic industry has also entered a new stage in which the market mechanism determines the allocation of resources, and the certainty of the future development of the industry has been greatly improved.

"with the landing of the new photovoltaic policy, the photovoltaic market is expected to recover, and the supply and demand pattern of each link of the industrial chain will be tight in stages, in which silicon materials, silicon chips, and other links have strong power to raise prices, and the company is positioned as a manufacturer of photovoltaic raw materials, which has a positive impact on the future development of the company." Tianlong photoelectric related person in charge to the Securities Times e company reporter said.

Tuorixineng also said that as a new energy source for sustainable development in the future, the photovoltaic industry is expected to achieve performance growth in 2019, and the development prospect is clear. In the short term, after the introduction of the policy, the domestic market demand will be gradually released, manufacturing photovoltaic enterprises will also usher in a wave of new orders, at the same time, the demand structure of the photovoltaic market will change from the Chinese market to the overseas market in 2019; in the long run, the photovoltaic industry into the affordable era will open up more market space, the industry prospects are considerable.

As for the installed capacity, Soochow Securities believes that the domestic market will be officially launched in the second half of the year, overseas will also enter the traditional peak season, maintaining the previous domestic new installed capacity 45-50GW, global new installed capacity 130GW installation target. According to the China Photovoltaic Industry Association, the new installed capacity of photovoltaic power generation in China exceeded 43GW in 2018, down 18% from the same period last year, and the cumulative installed capacity exceeded 170GW. In the new installed capacity, the centralized photovoltaic power station is about 23GW, down 31% from the same period last year, and the distributed photovoltaic power station is about 20GW, up 5% from the same period last year.

Some brokerage analysts also pointed out that the landing of the new deal is expected to promote the demand for new installed capacity of domestic photovoltaic in the second half of the year, and it is expected that with the approach of affordable Internet access, the photovoltaic industry is expected to usher in a "golden decade"; among them, 2019-2020 is the transitional stage of domestic affordable Internet access, and the links of batteries and components will become the main position for the current round of photovoltaic industry to reduce costs and increase efficiency, and is expected to obtain sustained capital investment in the industry.

Looking back at 2018, under the influence of last year's photovoltaic "limited scale, limited targets, reduced subsidies", the operating conditions of photovoltaic enterprises have taken a sharp turn for the worse, many enterprises have been forced to stop production, and many photovoltaic enterprises have experienced negative net profit growth during the year, and the industry has been hard hit.

The arrival of affordable Internet access is accelerated.

It is understood that since the 13th five-year Plan, the application scale of photovoltaic power generation in China has been continuously expanded, the technical level has been significantly improved, and the cost has dropped significantly. By the end of the first quarter of this year, China's photovoltaic power generation capacity has reached 180 million kilowatts, with an annual generating capacity of 177.5 billion kilowatt hours, ranking first in the world for many years in a row, but at the same time, the subsidy gap has continued to expand, and some areas have abandoned light and limited power, and other problems have become increasingly prominent.

In this context, on May 31 last year, the National Energy Administration issued the strictest photovoltaic policy in the history of photovoltaic development, making it clear that photovoltaic development will be limited in scale, electricity price, and subsidies. This policy has also been complained and resisted by the industry, known as the "Photovoltaic 531 New deal." At the beginning of this year, the National Energy Administration issued the Circular on actively promoting the work of Wind Power and Photovoltaic Power Generation without subsidy, clearly proposing the construction of affordable Internet access projects and low-cost Internet access pilot projects, improve the competitive allocation mechanism of projects that require state subsidies, and reduce the dependence of industry development on state subsidies. Subsequently, the National Energy Administration has also repeatedly for affordable access to the Internet, competitive configuration and other symposiums, issued to solicit opinions, and so on, continue to release the photovoltaic industry market-oriented signal.

In 2019, the total subsidy budget for new photovoltaic projects in China is 3 billion yuan, of which 750 million is used for household photovoltaic (equivalent to 3.5 million kilowatts) and 2.25 billion for competitive bidding projects (excluding photovoltaic poverty alleviation). The "notice" supporting document "2019 photovoltaic project construction work plan" has been clearly defined, 2019 new photovoltaic project subsidy budget is 3 billion yuan, of which 750 million is for household photovoltaic (equivalent to 3.5 million kilowatts) and 2.25 billion for competitive bidding projects (excluding photovoltaic poverty alleviation). Implying that the total amount of photovoltaic subsidies this year is fixed, but the implementation of competitive allocation, give priority to affordable Internet projects.

Gao Jifan, co-chairman of the Global Solar Council and chairman of the China Photovoltaic Industry Association, believes that due to the rapid decline in photovoltaic costs, the overall growth of overseas markets in 2019, and the rapid recovery of the EU market, the demand of the US market has rebounded sharply on the basis of last year, and the development momentum of Southeast Asia, Latin America, the Middle East, and other countries and regions is also very rapid, and the trend of diversification of the photovoltaic market is becoming more and more obvious. "it is expected that the installed capacity in the overseas market will increase significantly from last year's 60GW to about 85GW, and the domestic market will also show recovery growth."

"after more than 20 years of development, the cost of photovoltaic power generation has been reduced to the original 1-2019, and 2019 will be a milestone in the history of photovoltaic development-from then on, the global photovoltaic will quickly enter the era of comprehensive parity. Photovoltaic industry will also move from youth to youth, photovoltaic energy will gradually move towards the center of the energy stage. " At the recent SNEC Global Photovoltaic Conference, Wang Bohua, vice chairman and secretary general of the China Photovoltaic Industry Association, said so.

Enterprises have been practicing their internal skills one after another.

After a round of policies have been issued, the industry has generally realized that the days when they relied mainly on state subsidies for development in the past are gone forever, and if enterprises want to make great progress in the photovoltaic field in the future, they must strive to reduce costs and finally achieve affordable access to the Internet. Therefore, in the face of this year's market-oriented new policy, photovoltaic enterprises have become much more rational.

"the landing of the new photovoltaic policy will accelerate the elimination of backward production capacity in the photovoltaic industry, and the concentration of industry resources to outstanding competitors is obvious, requiring the manufacturing side to place more emphasis on modern lean manufacturing, which is conducive to the development of the company and the industry from a medium to long-term point of view." The relevant person in charge of easy special told the securities times e company that as early as this year before the new photovoltaic policy landed, easy special has increased the deployment of photovoltaic power stations, which will provide a stable source of profit for the company, at the same time, the company is actively promoting household photovoltaic, poverty alleviation photovoltaic and industrial and commercial distributed photovoltaic development of major businesses, but also in line with the guidance of the new policy.

"in the transition period of affordable access to the Internet, enterprises have to face two problems: the first is how to persist until the arrival of the affordable era, and the second is to practice internal skills, that is, to ensure quality and control costs." Costa said bluntly that for the affordable Internet project, Costa has invested a lot of manpower, material and financial resources around the core equipment photovoltaic inverter. The power grade, power density, heat dissipation capacity, reliability, stability and voltage grade and capacity ratio of the product have always been the focus of Costa research.

Xiexin integration plan reduces costs in a variety of ways. When the company recently accepted institutional research, it said that in the field of silicon materials, silicon chips, and battery components, the space for further reduction in costs is limited due to the influence of commodity and manufacturing cost factors, and there is a need to further increase technical investment in the future. by improving the conversion efficiency of cells and components, increasing the power generation per unit photovoltaic modules, amortizing the investment cost of photovoltaic power stations, so as to achieve the purpose of affordable access to the Internet; At the same time, in terms of non-technical cost restrictions, domestic land costs, financing costs, tax costs are relatively high, in the future hope to further reduce the financing costs of enterprises, in order to reduce the investment cost of photovoltaic power plants.

In the face of the New deal, hard work seems to have become the consensus of the photovoltaic industry. Dongfang Risheng also revealed that in promoting the realization of affordable Internet access, the company will continue to improve the efficiency of battery components, optimize the structure of battery components, strengthen product quality, and strive to bring highly reliable, efficient and cost-effective photovoltaic products to users around the world.

Some companies even hammered out affordable online schedules as early as a year ago. In an interview with the Securities Times e Company in August last year, Sunshine Power supply said that in areas where the light is very good, the company has achieved or is close to achieving affordable Internet access, and after several years of efforts, the company photovoltaic power generation will soon be able to achieve full parity online, in two or three years.

Active Investment and merger in the Industry

At a time when the trend of the industry is clear, investment and mergers and acquisitions in the photovoltaic field have been quietly active, and a new round of industrial integration in the industry has also begun.

According to the incomplete statistics of the reporter of Securities Times e Company, dozens of photovoltaic investment and mergers and acquisitions projects have taken place in the capital market since this year, and since June, the relevant cases have emerged one after another, and many enterprises with state-owned assets have also accelerated to enter the market one after another.

Hong Kong shares disclosed that Tower Energy Co., Ltd., a wholly owned subsidiary of photovoltaic, mobile power generation, energy storage services and wind power, was officially registered on June 5, 2019 with a registered capital of 5 billion yuan. This means that China Tower, a central enterprise, has officially entered the photovoltaic field.

On the same day, Societe Generale and its holding subsidiary Societe Generale announced at the same time that Societe Generale had conditionally agreed to issue more than 1.687 billion subscription shares to Shandong State Capital Water Development Group (Hong Kong) holding Co., Ltd., involving a capital of more than 1.552 billion yuan. Upon completion of the subscription, Shuifa Hong Kong will hold 66.92% of the shares of the listed company and indirectly hold more than 50% control of China Societe Generale New Materials Holdings Limited.

A day earlier, the photovoltaic sector has just ushered in a number of industry leaders in the trend of investment and mergers and acquisitions. Poly Xiexin, the world's largest polysilicon enterprise and the world's largest wafer manufacturer, disclosed on June 4 that it plans to sell its 51% stake in Xiexin New Energy to Huaneng Group, a subsidiary of China Huaneng Group. On the same day, Longji shares, the world's two leading single crystal product manufacturers, and Tongwei shares, the world's largest solar cell manufacturer, announced the formal signing of a strategic cooperation agreement, specifically: Longji shares strategy to take a stake in Tongwei Baotou 50,000 tons of high pure silicon project, holding a 30% stake in the project; At the same time, Tongwei shares strategy to take a stake in Longji Ningxia Yinchuan 15GW single crystal silicon rod and wafer project, holding a 30% stake.

The first cross-ownership between the leaders is meaningful. "the cost requirement of the parity project is particularly high. If the two leading enterprises cooperate and complement each other in the industrial chain, and reduce the cost of the battery wafer and silicon wafer to the lowest, they can reduce the cost and increase the efficiency. Of course, this will also hedge some of the non-technical costs such as financing. " Tongwei shares in charge of the evaluation of the cooperation.

Mergers and acquisitions in similar industries are not uncommon. The reporter found that before this, Aikang Science and Technology, Luxiao Technology, Jingao Solar Energy, Tianhe Light Energy, China Power, China Power Photovoltaic and other photovoltaic enterprises have also announced the trend of relevant investment and mergers and acquisitions, and the heat of investment and mergers and acquisitions in the photovoltaic field has increased significantly.

Lu Bing, an expert on mergers and acquisitions in the Chinese energy industry of PricewaterhouseCoopers, pointed out that in the future, large and medium-sized enterprises in the industry will rely more on mergers and acquisitions to increase their installed capacity, while small enterprises in the industry will be affected by the postponement of payment of state subsidies and operating risks, resulting in greater pressure on cash flow, and it is possible to withdraw through the sale of assets, and the concentration of the industry will be further enhanced.

"at present, China's photovoltaic industry is showing two major trends, one is that the integration and reshuffle has always continued, and the industry concentration has been increasing; the other is that the elimination of backward production capacity by high efficiency capacity continues to accelerate." Tongwei executives believe.

Full enterprise orders

Behind the warming of investment is accompanied by the recovery of the industry and full orders from enterprises.

Securities Times e company investigation found that at present, Hengdian East Magnetic, Sunshine Energy, Longji shares, Tongwei shares, Central shares, Jingsheng mechatronics, Xiexin Integration and other photovoltaic companies have been in a state of full production and pin, some leading enterprises in the first half of 2019 orders have been full, behind the pull is mainly in the overseas market.

Take Xiexin Integration as an example, at present, the company has abundant orders in hand, which has been listed until the third quarter of this year. Xiexin integrated components shipped 4.56GW in 2018, of which 2.3GW was shipped overseas and the proportion of overseas business rose to 52.9%. In the first quarter of this year, the proportion of overseas market revenue has exceeded 70%, and the overall revenue of overseas business is expected to account for more than 70% of the total revenue for the whole year.

Looking at Sunshine Power supply, the company recently accepted institutional research, saying that orders in the first half of the year have been relatively full, mainly to meet the needs of foreign markets and some domestic stock power stations, and that the domestic inverter market will gradually start because of the design of bidding and bidding rules. At the same time, the global market share of its inverter has been steadily increasing.

Jingke Energy also revealed that the company's overseas market growth this year is very obvious, has been exported to more than 100 overseas countries, this year will continue to increase, the future will continue to expand overseas business market.

In addition, according to Anxin new observation, the top 10 domestic production capacity of component companies, the first half of 2019 orders have been signed, and even some enterprises have begun to sign orders for the third and fourth quarters, and most of the orders are from overseas markets.

A new round of production expansion is coming

Full orders directly gave birth to a new round of production expansion in the industry.

On the evening of June 15, Longji shares announced that Longji Leye Photovoltaic Technology Co., Ltd., a wholly owned subsidiary of Longji Leye Photovoltaic Technology Co., Ltd., signed a project investment agreement with the people's Government of Hailing District of Taizhou City, in which the company reached a cooperative intention to invest in the construction of an annual 5GW single crystal module project in Taizhou, with an investment of about 2.4 billion yuan. Longji said the investment will help to improve the production capacity of efficient single crystal products and further increase the market share of single crystals. It is worth mentioning that since the beginning of this year, Longji shares have thrown out a number of production expansion plans, involving a total of tens of billions of yuan.

Coincidentally, the Central shares also came out with a production expansion plan on May 30. the company said that it plans to invest 9.13 billion yuan in the fifth phase of the Central Xiexin project to build monocrystal silicon materials for renewable energy solar cells, with a new production capacity of 25GW. After the completion of the "Central Industrial Park," the overall production capacity will reach more than 55GW, becoming the largest production base of high-efficiency solar monocrystal silicon in the world, and the average annual sales income of the project after reaching production capacity is 7.3 billion yuan. The average annual profit is 1.2 billion yuan.

The expansion of photovoltaic industry seems to have quietly spread to the whole industry. According to the rough statistics of the reporter of Securities Times e Company, so far, Longji shares, Tongwei shares, Central shares, Poly Xiexin Energy, Jingke Energy, Fulet, Aerospace Machinery and Electrical and other companies have all announced production expansion.

It is worth mentioning that in the past development of the photovoltaic industry, every capacity expansion will give birth to the rise of giants. After precipitation, the photovoltaic industry has once again entered a new round of business cycle, ushered in the second wave of expansion tide, Jingke and other upstarts have come to the fore.

Shenzhen, a private equity person pointed out that it is expected that under this round of photovoltaic new policy, the competitiveness of the entire photovoltaic industry enterprises will be significantly enhanced, Chinese photovoltaic enterprises in the global market leading position will also be further consolidated, and with the subsequent domestic and international photovoltaic demand, industry costs are gradually falling, China's photovoltaic industry will usher in a new round of development climax, during this period, the leading enterprises in different industrial chains in the photovoltaic industry are worthy of attention.

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