JinkoSolar share: Strong solar industry as an opportunity – How JinkoSolar wants to assert itself in the photovoltaic industry

• Forbes award for solar panels
• Burden on quarterly figures
• Subsidiaries with successful IPO

JinkoSolar with a worldwide customer base

At a time when climate change is regularly the subject of public debate, the demand for environmentally friendly energy sources is increasing. In addition to wind turbines, solar energy is also repeatedly mentioned in this context. The Chinese solar module manufacturer JinkoSolar could also benefit from the hype about renewable energies in the future. Since it was founded in 2006, the group has been committed to environmentally friendly energy production. The group’s business not only includes the sale of its own solar panels, but also various services for generating solar energy. According to the company, JinkoSolar’s customer base includes customers from “China, the United States, Japan, Germany, Great Britain, Chile, South Africa, India, Mexico, Brazil, the United Arab Emirates, Italy, Spain, France, Belgium and other countries and regions”.

High praise for powerful solar panels

Just recently, the Chinese edition of the business magazine Forbes named JinkoSolar one of the top 50 most innovative companies in China, according to a press release. The paper also named the N-Type series of solar modules the “most promising clean energy technology of the year”. The panels are characterized by an output of 480 watts, an efficiency of 21.38 percent and a product guarantee of at least 15 years. “Being included in this list is a validation of our unique approach to deliver next-generation technologies and high-quality, reliable products to move the world towards a low-carbon goal,” said Vice President Dany Qian after the Forbes award.

Weak 3rd quarter of 2021

The announcement provided some consolation over the company’s third-quarter results, which JinkoSolar reported back in November 2021. The company was able to increase its total revenue in the third quarter compared to the second quarter by 8.1 percent to 8.57 billion Chinese renminbi, but compared to the same quarter last year, sales fell by 2.3 percent. “The sequential increase was mainly due to an increase in solar module shipments, while the year-on-year decrease was primarily due to a decrease in solar module shipments,” the company’s report said. And there was also a drop in the delivery figures: With a scope of delivery of 4,993 megawatts, consisting of 4,671 megawatts for solar modules and 322 megawatts for solar cells and wafers, JinkoSolar is 4.0 percent behind the second quarter of 2021 and 2.4 percent behind the same period last year. “The release of more efficient new cell capacity significantly reduced our cell production costs in the third quarter, partially offsetting the impact of high prices for polysilicon and other materials on production costs. Overall shipments were impacted by the delay in revenue recognition due to logistical issues and blockages. The logistics costs continued to increase compared to the second quarter, and module prices hit a new high in almost a year,” said CEO Xiande Li. The disappointing numbers were reflected in the company’s share price.

Here’s how JinkoSolar stock is moving

The solar module manufacturer’s shares were first listed on the NYSE on May 14, 2010. At launch, approximately 5.8 million shares were issued, raising approximately $64.2 million. The initial price was 11.00 US dollars, during the first day of trading the paper made it up to 11.14 US dollars, but then closed a little lower at 10.74 US dollars. Another 3.5 million shares followed in November of the same year, earning the company approximately $126 million. While the paper leveled off between USD 7.00 and USD 30.00 until the start of the Corona crisis, Jinko shares then broke through the USD 60 threshold for the first time in the summer of 2020. Around the same time, Bloomberg ranked the company the “best solar brand for leveraged projects” and the “most bankable” photovoltaic manufacturer. After the publication of the latest quarterly figures, however, the shares initially leveled off at USD 45, and the share is currently trading at around USD 42.

Successful IPO in Shanghai

Since January 26, 2022, the shares of the subsidiary Jiangxi Jinko have also been traded in the home market in Shanghai – in addition to the Wall Street listing of the parent company. According to the news agency “Bloomberg”, the company can thus benefit from the optimistic assessment of the industry by Chinese investors. The People’s Republic is considered the market leader in the manufacture and installation of solar modules. And the plan seems to have worked: in mid-January, the company announced an issue price of 5 Chinese renminbi for the two billion share certificates. Already at the beginning of the first session, the Jinko share was able to trump the issue price with 8.50 renminbi, at the end of trading it went up to 10.55 renminbi. After the first day of trading, the share was 111 percent above the issue price. The parent company’s shares also benefited from the IPO and rose significantly on Wall Street. Most recently, Jiangxi Jinko shares traded at 11.06 renminbi (closing price on February 09, 2022). Another eight billion Jinko shares are currently outstanding.

Strong growth expected

However, according to Bloomberg, international investors could hold back as sentiment between China and the US remains tense and Chinese companies have recently been delisted in the US. For example, Uber’s competitor DiDi withdrew from the US stock exchange last year. Market expert Wang Chen from XuFunds Investment Management predicted a rosy future for the solar group to the agency. “Some investors might consider it an investment after comparing earnings expectations to valuation. United States policy is indeed an uncertainty, but changes in the future need to be awaited.” And JinkoSolar CEO Xiande Li was also satisfied after the IPO in Shanghai. “As we continue to scale and grow, access to capital will enhance our competitiveness as we can leverage our network and resources accumulated over the years to strengthen our leadership position in the global photovoltaic industry,” according to a press release. “Looking ahead, we are confident of achieving continued growth and committed to creating sustainable value for all of our shareholders in China and around the world.” JinkoSolar currently holds 58.62 percent of the shares in subsidiary Jiangxi Jinko, according to the announcement.

Solar industry before a new record

Despite the tensions between the US and China, the industry is booming, as Bloomberg notes in a management report. According to data from the agency, 183 gigawatts of photovoltaic systems were installed worldwide last year, but 2022 is set to be the first year in which the energy demand from new solar systems exceeds 200 gigawatts for the first time. The experts expect an average of 228 gigawatts, with a range of 204 to 252 gigawatts being possible. “This is a significant increase from our November 2020 expectation, where the highest scenario for 2022 was 206 GW,” the report said. Nevertheless, there is a possibility that the threshold of 200 gigawatts will already be exceeded in 2021. Comprehensive data on this are not yet available.

Editorial office finanzen.net

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