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 a reporter from Securities Times Company e, in order to cope with the established development trend of "affordable Internet access" in the industry, better transition from a 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, enterprises in the industry have long been waiting for the undercurrent under the policy of investment, mergers and acquisitions, expansion of production, going out to sea, entering the bureau of state assets, and so on.
The industry hopes to welcome a significant 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 usher in a significant recovery, and the supply and demand pattern of each link of the industrial chain will be tight in stages, among which silicon materials, silicon chips, and other links will have a strong driving force to raise prices, and the company will be positioned as a manufacturer of photovoltaic raw materials in the future, which will have 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.
Some brokerage analysts 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 battery panels 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.
Enter the era of comprehensive parity
"after more than 20 years of development, the cost of photovoltaic power generation has been reduced to the original 1 / 20, 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 that the Chinese photovoltaic market will start relatively quickly from June, and there will still be better prospects for installation in the second half of the year.
As for this year's photovoltaic installed capacity, 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."
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, to maintain the previous domestic new installed capacity 45-50GW, global new installed capacity 130GW installed target. According to data from 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.
It is understood that under the influence of last year's photovoltaic "limited scale, limited targets, and reduced subsidies," although the overall installed capacity of the industry has not fluctuated significantly, the operating conditions of photovoltaic enterprises have taken a sharp turn for the worse, and many enterprises have been forced to stop production, and many photovoltaic enterprises have experienced negative growth in net profits during the year, and the industry has been hard hit.
With last year's 531 photovoltaic retreat policy issued after many enterprises complain, resistance to the reaction, in the face of this year's market-oriented new policy, photovoltaic enterprises have been 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 Internet access, 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 that for the affordable Internet project, the company has invested a lot of manpower, material and financial resources around the core equipment photovoltaic inverter. The power level, power density, heat dissipation capacity, reliability, stability and voltage level and capacity ratio of the products 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.
Enterprises have been practicing their internal skills one after another.
In the face of the New deal, hard practice of internal skills 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. After several years of efforts, the company photovoltaic power generation will soon be able to achieve full parity online, in two or three years.
It is not groundless for industry enterprises to prepare ahead of time. A person in the photovoltaic industry told reporters that after the release of the "531 New deal" last year, 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 considerable progress in the photovoltaic field in the future, efforts must be made to reduce costs and finally achieve affordable access to the Internet.
At the same time, as early as the beginning of this year, the State Energy Administration issued the Circular on actively promoting the work of Wind Power and Photovoltaic Power Generation without subsidy, it has also clearly proposed to carry out 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. In addition, since the beginning of this year, the National Energy Administration has repeatedly held symposiums on affordable Internet access, competitive configuration, and issued notices to solicit opinions, so as to continuously release the market-oriented signal of the photovoltaic industry.
According to the information from the National Energy Administration, since the 13th five-year Plan, the application scale of photovoltaic power generation in China has been expanding, the technical level has been improved obviously, and the cost has decreased significantly. By the end of the first quarter of this year, the installed capacity of photovoltaic power generation in China 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 continues to expand, and some areas abandon light and limit electricity and other problems have become increasingly prominent.
In this context, the "Circular" supporting document "2019 Photovoltaic Power Generation Project Construction work Plan" is clear, the total subsidy budget for China's new photovoltaic projects in 2019 is 3 billion yuan, of which 750 million yuan is used for household photovoltaic (equivalent to 3.5 million kilowatts) and 2.25 billion yuan for 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.
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.
On June 5, China Tower, a Hong Kong stock company, disclosed that Tower Energy Co., Ltd., a wholly owned subsidiary of its main photovoltaic, mobile power generation, energy storage services, wind power and so on, was officially registered on June 5, 2019, with a registered capital of 5 billion yuan, which 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 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: Longji shares strategy to take a stake in Tongwei Baotou 50, 000 tons of high pure silicon project, holding a 30 per cent stake in Longji Ningxia Yinchuan 15GW monocrystal silicon rod and wafer project.
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, the industry concentration has been increasing; the other is the continuous acceleration of the elimination of backward production capacity by high-efficiency production capacity." Tongwei executives believe.
The order is full, the enterprise is busy to expand production.
Accompanied by the warming of investment, enterprise orders are full and the industry is busy to expand production.
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 have been full orders in the first half of 2019, and the driving force behind this is mainly 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 said that the first half of the order has been relatively full, mainly to meet the needs of foreign markets, and some domestic stock power stations, the domestic inverter market because of bidding and bidding rules design factors, will gradually start, 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.
Full orders have directly given 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 that the investment will help to improve the production capacity of high-efficiency single crystal products, seize the development opportunities of the single crystal market, 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 funds 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 invest in the industrialization of monocrystal silicon materials for renewable energy solar cells, with a new production capacity of 25GW. Upon completion, the overall production capacity of the "Central Industrial Park" will reach more than 55GW. It has become the largest single crystal silicon production base for high efficiency solar energy in the world, with an average annual sales income of 7.3 billion yuan and an average annual profit of 1.2 billion yuan.
The expansion of photovoltaic industry seems to have quietly spread to the whole industry. According to the rough statistics 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, Jingke and other upstarts have emerged.
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.