Local State-Owned Capital Buys the Dip in PV? Quzhou Industrial Control Expected to Take Control of DAS Solar, Which Once Planned an IPO on the Growth Enterprise Market

The emerging PV module brand DAS Solar is expected to be incorporated under the local state-owned assets. Caixin reporters noted that the Shanghai Municipal Administration for Market Regulation recently released a simplified case announcement form for the concentration of operators regarding the "Acquisition of DAS Solar Technology Co., Ltd. by Quzhou Industrial Holding Group Co., Ltd.", indicating that DAS Solar may be controlled by Quzhou State-owned Assets.

The announcement shows that a subsidiary of Quzhou Industrial Holding Group Co., Ltd. ("Quzhou Industrial Holding") signed an agreement with Beijing Ruihui Haina Technology Industry Fund (Co., Ltd.) ("Beijing Ruihui"), where Quzhou Industrial Holding acquired 17.46% of the shares of DAS Solar Technology Co., Ltd. ("DAS Solar") and is expected to sign a voting rights entrustment agreement to obtain the voting rights of DAS Solar held by Liu Yong and his concerted parties.

DAS Solar is primarily engaged in the solar cell module business. Before the transaction, Liu Yong held 29.03% of the voting rights of DAS Solar, controlling it individually. After the transaction, Quzhou Industrial Holding will hold no less than 34.05% of the voting rights of DAS Solar, controlling it individually.

Quzhou Industrial Holding was established on May 25, 2018, in Quzhou, Zhejiang Province, with its main business including housing construction engineering, commercial housing development, and sales. Quzhou Industrial Holding is a subsidiary of the State-owned Assets Supervision and Administration Commission of the Quzhou Municipal People's Government.

According to information provided by DAS Solar personnel to Caixin reporters, the strategic control of DAS Solar by Quzhou Industrial Group is a key step in the group's layout of the new energy industry chain. Both parties will deeply integrate technology, capital, and resources to build a leading domestic new energy technology innovation and industrialization platform.

It is introduced that this control of DAS Solar is an important measure for the group to deepen the layout of the new energy track and build a full-chain ecosystem of "R&D-manufacturing-application". As one of the top-tier enterprises in the PV industry, DAS Solar further consolidates its leading brand position in the industry with its core technology accumulation in efficient batteries, PV modules, and full-scenario solution systems.

DAS Solar was established in August 2018. Its founder and chairman, Liu Yong, has served as a senior executive in several top-tier PV enterprises such as JA Solar Technology (002459.SZ) and Jolywood (300393.SZ). Shortly after the establishment of DAS Solar, the "dual carbon" goals were proposed, and the global energy substitution wave led to a significant increase in domestic and overseas PV installation demand.

Amid rapid development, DAS Solar first disclosed its prospectus (draft) on December 29, 2023, planning to list on the GEM. Financial data shows that from 2021 to 2023, DAS Solar's operating revenues were 1.894 billion yuan, 8.606 billion yuan, and 22.724 billion yuan, respectively.

However, affected by changes in the PV cycle and tightening of capital market financing, DAS Solar ultimately terminated its IPO process in August 2024. In September of the same year, there were reports that CATL planned to acquire DAS Solar to layout the upstream manufacturing of PV. However, the rumor ended with CATL's denial, and the transaction did not materialize.

DAS Solar is one of the representative enterprises of N-type TOPCon. According to its official website, the laboratory efficiency of its N-type TOPCon battery has exceeded 26%; in terms of industrialization, the mass production efficiency of N-type TOPCon battery has exceeded 25.2%. According to the 2024 global module shipment ranking released by Infolink, DAS Solar ranks ninth in the industry.

In terms of equity, DAS Solar's shareholding structure is relatively dispersed. According to its updated prospectus in June 2024, Liu Yong holds 12.6048% of the shares and, through five employee shareholding platforms such as Quzhou Zhihe and several concerted parties, holds a total of 29.0307% of the voting rights, making him the actual controller of the company.

However, the largest shareholder of the company was previously Beijing Ruihui, which held 19.46% of the shares. Ruihui Haina is an investment enterprise under Three Gorges Capital, which is affiliated with the Three Gorges Group. After this transaction, Quzhou Industrial Holding will acquire the 17.46% shares held by Beijing Ruihui, and with the voting rights entrusted by Liu Yong, Quzhou Industrial Holding will control DAS Solar individually.

More details about the transaction amount have not been disclosed. The PV industry is currently in the stage of capacity clearance, and companies generally face certain operational pressures. There have been precedents for local state-owned assets to acquire or control PV enterprises. In December 2024, *ST Zhongli (002309.SZ) was acquired by Xiamen C&D Group. Shortly thereafter, Xiamen C&D again took over the veteran module company Wuxi Suntech Power.

Industry analysis believes that after state-owned assets take control, their state-owned background can provide financial support to DAS Solar and reduce financing costs. PV manufacturing is a capital-intensive industry that requires substantial continuous investment. From 2021 to 2023, the consolidated asset-liability ratios of DAS Solar were 87.71%, 86.54%, and 86.89%, and the current ratios were 0.89, 0.98, and 1.04, respectively. Compared with peer companies, the asset-liability ratio is higher, and the current ratio is lower.