The silicon wafer leader, which has not lost money for 12 years, has "overturned" for two consecutive quarters;
15 major photovoltaic factories that have touched the market value of 100 billion yuan have fallen one after another in two years.
At the beginning of 2024, the industrial environment has changed dramatically and the performance of the leading companies has declined, although the first quarter of each year is the traditional off-season for the photovoltaic industry, but this "spring cold" is obviously more cold than in previous years.
On April 22, the National Energy Administration released the national power industry statistics from January to March, showing that in the first three months of this year, 45.74 GW of new photovoltaic capacity was installed, a year-on-year increase of 36%. According to the data released from January to February, the new installed capacity of PV in March was only 9.02 GW, a year-on-year decrease of 32.13%. This is also the first time in the past three years that the monthly new installed capacity has declined year-on-year.
At the beginning of the year, the China Photovoltaic Industry Association issued a warning that the unreasonable time-of-use electricity price policy in some provinces has restricted the development of distributed and residential photovoltaics. At the same time, the problem of power grid consumption is highlighted, and the participation of new energy sources such as photovoltaic in electricity market-oriented transactions has become an inevitable trend, followed by the uncertainty of development benefits and possible investment risks.
Under the drastic changes in the internal and external environment, the traditional photovoltaic provinces in the north are bearing the brunt, and the land use is gradually tightening, and the scope of the "red zone" is expanding......
If the above factors are an important background for the decline in installed capacity in March, then the most direct fuse is the collapse of industrial chain prices.
"Tomorrow's installation may be lower than today's cost, so why install today?" said an employee of a large factory. At present, the price of photovoltaic products continues to decline and has not stabilized, and the downstream generally maintains a wait-and-see attitude. On the other hand, terminal operators such as state-owned enterprises are also paying close attention to prices and risks, and in view of the current industrial chain inventory is still at a high level, their strategy is more prudent: in the first quarter, they would rather not buy than buy expensive.
On April 2, Datang Group opened bids for the 2024-2025 annual centralized procurement of photovoltaic modules, divided into three bid packages, with a total scale of 16GW, with a total of 62 companies participating in the bidding, and the quotations of the three modules reached a new low. Among them, N-type TOPCon modules were quoted at the lowest price of RMB 0.79/W and the average price was RMB 0.818/W, while N-type HJT modules were quoted at the lowest price of RMB 0.89/W and the average price was RMB 0.951/W. The lowest price for PERC modules was RMB 0.74/W, and the average price was RMB 0.818/W. It is worth mentioning that this is also the first time in the industry that a company has quoted a price of less than RMB 0.75/W for PERC modules including tax in the module bidding of a central state-owned enterprise.
On the road to involution, there is destined to be no winner.
Leading performance declined
On the evening of April 29, the quarterly report released by the "photovoltaic leader" LONGi Green Energy showed that LONGi's total revenue in the first quarter fell by 37.59% year-on-year to 17.674 billion yuan. The net profit attributable to the parent company decreased by 164.61% year-on-year to a loss of 2.35 billion yuan. LONGi said that the main reason for the decline in performance in the first quarter was that the price of products in all links of the photovoltaic industry chain continued to decline, and the company's overall gross profit margin declined significantly, with an impairment provision of 2.649 billion yuan for inventory assets and 152 million yuan for fixed assets in the current period, and an investment income of 103 million yuan recognized by polysilicon enterprises due to a sharp drop in polysilicon prices, a significant decrease of 1.082 billion yuan year-on-year.
On the same day, Tongwei Co., Ltd. announced its first-quarter results, and as the king of profitability in the photovoltaic track in 2023, Tongwei could not escape the fate of losses in the first quarter. According to the financial report, the company's total revenue in the first quarter fell 41.13% year-on-year to 19.57 billion yuan, and the net profit attributable to the parent company fell 109.15% year-on-year to a loss of 787 million yuan. The company also pointed out that the year-on-year decline in Tongwei's Q1 operating income, net profit attributable to shareholders of listed companies, and net cash flow from operating activities was due to the sharp decline in prices in the photovoltaic industry chain, and the prices of the company's main products decreased sharply compared with the same period last year.
TCL Zhonghuan, a silicon wafer leader that has not lost money for 12 consecutive years, has suffered losses for two consecutive quarters. According to the financial report, the company lost 2.772 billion yuan in the fourth quarter of 2023. That's more than any of the previous three quarters. In the first quarter of this year, TCL Zhonghuan's performance continued to be 880 million yuan. In other words, in the past six months, TCL Zhonghuan has lost 3.652 billion yuan.
Looking at the photovoltaic track, the vast majority of players suffered a performance waterloo in the first quarter.
According to incomplete statistics, the total net profit attributable to the parent of the 63 listed photovoltaic companies in 2023 will be about 97.777 billion yuan, a year-on-year decrease of 14.38%, compared with 114.205 billion yuan in the previous year, and the total net profit attributable to the parent company in the first quarter of 2024 will be about 4.461 billion yuan, a year-on-year decrease of 87%, and about 35.599 billion yuan in the same period of the previous year.
The price of polysilicon is "avalanche", and the module side is in full swing. Among the four major PV module companies, only JinkoSolar and Trina Solar achieved profitability, but their profit growth rate declined. In terms of shipment scale, according to the statistics of InfoLink, a third-party organization, Jinko will return to the top spot in global module shipments in 2023, followed by LONGi/Trina, JA Solar, Tongwei/Canadian Solar, Chint New Energy, Risen Energy, and Yiyi New Energy.
In contrast, inverter companies generally maintain a positive profit situation, among which Sungrow has announced "gorgeous" performance to achieve contrarian growth.
Cross-border "escape"
Under the background of the overall pressure on the photovoltaic industry, cross-border enterprises have started to "retreat".
On March 18, Haiyuan Composites, whose main business is composite lightweight products, announced that the company signed the "Termination Agreement" after friendly consultation with the People's Government of Quanjiao County, decided to terminate the cooperation of related projects, and transferred 100% of the equity of Chuzhou Energy to Aiko Technology at a price of 38 million yuan. After the completion of the transfer, Haiyuan Composite Materials will no longer hold the equity of Chuzhou Energy.
Haiyuan Composites' Chuzhou project began at the end of 2022. On December 22, 2022, the company disclosed its plan to invest in a new photovoltaic industrial base in Quanjiao County, Chuzhou City, with its wholly-owned subsidiary Chuzhou Energy as the main body, of which the first phase plans to build a 10GW TOPCon (tunneling oxide passivation contact cell) high-efficiency photovoltaic cell project, and the second phase plans to build a 5GW HJT (heterojunction solar cell) ultra-high-efficiency photovoltaic cell and 3GW high-efficiency photovoltaic module project.
"In view of the great changes in the photovoltaic industry and market environment in the process of promoting the Chuzhou project, the company decided to terminate the Chuzhou project after careful study, in order to reduce investment risks and management costs, optimize resource allocation, and negotiate with the Quanjiao government amicably. Haiyuan Composites explained the reason for terminating the project.
Lingda Co., Ltd., which has been repeatedly "swiping the screen" recently, also announced on March 18 that it plans to terminate its investment in the construction of Tongling's 20GW annual output of high-efficiency photovoltaic cell industrial base project.
According to the previous announcement, the original planned investment of the terminated project was as high as 9.15 billion yuan, and it was planned to be constructed in two phases, of which the first phase of the project will build a high-efficiency cell production line with an annual output of 10GW, and the second phase of the project will build a high-efficiency cell production line with an annual output of 5GW TOPCon and a 5GW-hjt cell production line.
In the announcement, Lingda's statement is basically the same as that of Haiyuan Composites: "In view of the fact that the construction of the project is affected by various factors such as the macro environment, changes in the market environment of the photovoltaic industry, the financing environment, the implementation conditions of the project construction, and the progress of the relevant parties involved in the construction of the project, the project cannot advance the construction progress as originally planned." In order to effectively control the risk of foreign investment, the company reached a consensus with the Management Committee of Tongling Lion Rock High-tech Zone and decided to terminate the investment and construction of the Tongling project. ”
The industry generally expects that there may be more PV projects "unfinished" this year and next, and M&A activity in the industry will also intensify.
There may be a turnaround in June
"Now the second- and third-tier photovoltaic companies have begun to terminate the project, which is normal, the overcapacity is staged, and the market environment does not support the company to continue to expand production. I think the future is not only about the termination of projects, but also about many companies that will be eliminated. Lin Boqiang, dean of the China Energy Policy Research Institute at Xiamen University, said. But at the same time, he also emphasized: "In the long run, if the dual carbon goal is to be realized, wind power and photovoltaic will be the main consumption of energy." Therefore, the current capacity of the photovoltaic industry is insignificant for the future, and it is only a nodal surplus now. I am still very optimistic about photovoltaics, but it is not that the industry has no problems now, after all, the new energy industry is a new system, which requires us to face challenges and solve problems in development. ”
Lv Jinbiao, deputy director of the expert committee of the silicon branch of the China Nonferrous Metals Industry Association, believes that "the photovoltaic market will continue to grow, and the uncertainty is that it will increase or decrease, and the certainty of growth has led to the expansion of the entire photovoltaic industry chain year after year, until overcapacity begins to appear in 2023, but the industry-wide low prices that began in the second half of last year did not threaten the major players in the industry." In his view, the new competitive landscape will open the knockout competition, there are exits, there are also entry, first-line enterprises, new first-line enterprises this year will also set higher than last year's business goals. "All first-tier manufacturers have new plans to expand production, in addition to the existing share, there are new increments to grab, especially the fallen medium-sized enterprises will free up a part of the market. ”
Entering May, the battle between PV companies around price continues.
However, the industry generally believes that June may usher in the "bottom" of this round of adjustment in the photovoltaic industry. At the beginning of this year, JinkoSolar Chairman Li Xiande predicted in an interview with the media that module prices would be adjusted to a reasonable profit range by the second and third quarters of this year.
"We've seen a lot of PERC capacity cleared or upgraded this year, and that's going to happen quickly. Shen Wenzhong, director of the Solar Energy Research Institute of Shanghai Jiao Tong University, said that it is expected that after June this year, the domestic photovoltaic industry will return to a relatively healthy development channel.