is it time to buy the bottom in photovoltaic industry? three gorges withdraws from photovoltaic dark horse, catl intends to take over, and the negotiation is in progress
2024-09-11
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catl, the global leader in power batteries, wants to rapidly expand its photovoltaic assets to maximize the synergy benefits of its main energy storage business. there are rumors that catl is in talks to acquire the photovoltaic module manufacturer yidaxinneng. the paper has confirmed this with multiple yidaxinneng insiders, industry insiders, and people close to catl.
according to people familiar with the matter, as the negotiations are still ongoing, it remains unknown whether this landmark and sizable transaction can be finalized. the paper also sought confirmation from catl on this matter, but as of press time, catl has not yet responded.
yida new energy, headquartered in quzhou, zhejiang, is the full name of yida new energy technology co., ltd. it was established in august 2018. in the fiercely competitive photovoltaic module market where established companies gather, yida new energy, as a newcomer, has quickly entered the top ten in the world in terms of photovoltaic module shipments in recent years, and is known as the "photovoltaic dark horse". according to statistics from third-party consulting agency infolink, in the first half of this year, yida new energy became the world's eighth largest module supplier, ranking firmly in the second echelon. in august this year, yida new energy's eight-month ipo process was terminated.
amid the cold wave in the photovoltaic industry, mergers and reorganizations have suddenly heated up. in mid-august, tongwei co., ltd. announced that it plans to acquire no less than 51% of runyang co., ltd.'s equity through capital increase and acquisition, with a total amount not exceeding 5 billion yuan. if this largest acquisition in the history of photovoltaics is successfully completed, runyang co., ltd. will become a holding subsidiary of tongwei co., ltd. based on the shipment volume in 2023, tongwei co., ltd. and runyang co., ltd. will be the world's first and fifth largest suppliers of photovoltaic cells, respectively.
different from the vertical acquisition between tongwei and runyang, if catl takes over yidaxinneng, it will be another story. zeng yuqun, chairman of catl, has said publicly many times that the company has three strategic development directions, namely renewable energy plus energy storage to achieve fixed chemical energy substitution; power batteries to achieve mobile fossil energy substitution; electrification + intelligence to achieve integrated innovation in market applications. entering the photovoltaic industry chain will help catl accelerate the development of the global photovoltaic storage integration market, which is growing strongly.
dark horse remarries
the potential change of ownership of yida xinneng is due to the intention of its major shareholder to withdraw.
not long ago, a media outlet quoted an insider of yida new energy as saying that the three gorges group would "fade out" from yida new energy, and that the latter was negotiating with new potential investors and the progress was smooth. there were also rumors that the company that was interested in acquiring yida new energy was not a company in the photovoltaic industry, but a cross-border enterprise. after yida new energy withdrew its ipo application, the news that the three gorges group was going to withdraw seemed more and more real: the failure to successfully exit through ipo and the need for continuous "blood transfusions" may be the direct catalyst for the three gorges group to consider withdrawing from yida new energy.
as one of the new photovoltaic forces that has risen rapidly in recent years, yida new energy was founded by photovoltaic veteran liu yong. the sales of battery cells and modules are the main source of revenue for the company. after completing the pre-ipo round of financing in july last year, yida new energy's valuation has reached nearly 10 billion yuan, a surge of more than 30 times in two years.
at the end of 2023, yida new energy launched a sprint for listing on the chinext, intending to raise 2.5 billion yuan through an ipo to be used for an annual production of 14gw n-type topcon high-efficiency monocrystalline battery and 20gw high-efficiency monocrystalline module projects, as well as to supplement working capital projects. however, the rapid listing momentum came to an abrupt halt due to the cooling of the a-share ipo market and the downward cycle of photovoltaics. on january 24 this year, the shenzhen stock exchange issued the first round of review inquiry letters to yida new energy. on june 29, yida new energy updated its prospectus and other materials. less than two months later, yida new energy took the initiative to withdraw its listing application.
according to the prospectus data, from 2021 to 2023, yidaxinneng's operating income was 1.894 billion yuan, 8.606 billion yuan and 22.724 billion yuan, respectively, with a compound growth rate of 246.39%. during this period, the company's net profit attributable to its parent was approximately -147 million yuan, 203 million yuan and 460 million yuan, respectively. however, compared with its peers, its asset-liability ratio is relatively high. the asset-liability ratios of the consolidated statements are 87.71%, 86.54% and 86.89%, respectively, and the current ratios are 0.89 times, 0.98 times and 1.04 times, respectively. yidaxinneng mentioned in the prospectus that the company is still in a rapid development stage, and the subsequent capital investment needs are high. if it cannot effectively expand its financing channels, it will face debt repayment and liquidity risks.
the rapid rise of yida new energy is closely related to the strong support of the three gorges investors behind it. the largest shareholder, beijing ruihui haina technology industry fund (limited partnership), was initiated and established by three gorges capital holding co., ltd. under the three gorges group and beijing haidian district state-owned assets investment and operation co., ltd. the fund manager is jiangxia xintai (beijing) private equity fund management co., ltd. in addition, in recent years, the three gorges group has been the largest customer of yida new energy. in 2023, sales to the three gorges group accounted for as much as 30.69% of yida new energy's current operating income.
liu yong once explained the advantages of yida new energy's equity structure with a central enterprise as the major shareholder, saying: "for example, when our shareholders invest in or own power plants, we naturally have downstream channels. central enterprises are developing clean energy as a key strategic goal. when companies like yida work hard at the downstream end, both sides can advance on two fronts and maximize their advantages."
however, as the entire photovoltaic industry slid into a trough, product prices shrank significantly, and performance was generally under pressure, the survival crisis of second-tier manufacturers was rapidly magnified. according to the prospectus of yida new energy, it is expected to incur operating losses in the first half of 2024.
runyang co., ltd., which was entrusted to tongwei co., ltd., was once only one step away from listing. the company obtained ipo approval on june 29, 2023, but failed to issue it within the one-year validity period. in june this year, its ipo registration approval expired. the failure of the ipo and the sharp drop in battery cell prices caused runyang co., ltd. to suffer great financial pressure in the photovoltaic winter, and finally chose to "sell" to tongwei.
photovoltaic winter ignites ningde's acquisition interest
yida new energy is not the only target of catl. according to latepost, before contacting yida, catl also tried to acquire 51% of runyang shares for 4 billion yuan, but runyang was eventually bought by tongwei with a higher bid. in the second quarter of this year, catl began to contact several photovoltaic module companies.
it is not difficult to see that when the entire photovoltaic industry is experiencing a "double kill" in performance and valuation, catl is taking the opportunity to acquire photovoltaic assets. after tesla and byd, there will be another new energy giant that is simultaneously developing lithium batteries and photovoltaics.
photovoltaic and energy storage are the best match. the rapid development of intermittent renewable energy has brought increasing challenges to the stability of the power grid. energy storage can improve the overall system stability and control the quality of power. the integration of photovoltaic and energy storage is inevitable.
catl's photovoltaic chess game has already been laid out. in 2020, zeng yuqun participated in the pre-a round of financing of gcl-poly optoelectronics through its holding subsidiary ruiting investment, successfully adding fuel to the perovskite market. in march this year, the patent for "perovskite solar cell and its preparation method and power device" applied by catl was announced.
in the middle and lower reaches of the industrial chain, on february 1, the grid-connected ceremony of catl's 1.1gw third batch of national large-scale photovoltaic base projects and times green energy yanzhou phase i 250mw photovoltaic power generation project was held; in june, there was a change in shareholders in liyang leye photovoltaic energy co., ltd., and the original shareholder was replaced by catl's subsidiary times green energy co., ltd.; in the same month, the photovoltaic equipment company bozhou xijia new energy co., ltd. underwent industrial and commercial changes, and the original wholly-owned shareholder huang guangtian withdrew, and catl's subsidiary times green energy co., ltd. was added as a shareholder and held 100% of the shares. at the same time, many key personnel of the company changed.
catl, which has ample funds, can afford to buy. by the end of 2023, catl will have 60 billion yuan in cash. its net profit in the first half of this year reached 22.8 billion yuan, a year-on-year increase of 10.3%. it is the only company with a net profit among global power battery companies this year.
"yida also knew that catl did not have a good target, so the reserve price offered was higher than 1x pb, but catl thought it was too expensive, and the two sides are still arguing," the above report said. in fact, it depends on catl's basic judgment on the trend of the photovoltaic market. if it believes that capacity clearance and losses will continue, then the acquirer will be more patient.
photovoltaic industry insiders generally believe that if ningde's acquisition of yida is finally completed, it will be a good thing for both parties.
there are also market sources saying that some leading photovoltaic companies may be the main competitors of catl in acquiring photovoltaic companies.
when stockpiling food for the winter, there are not many photovoltaic leaders that are capable and interested in acquiring peers. at the performance meeting held recently, longi green energy chairman zhong baoshen made it clear that the company currently has no plans to acquire assets. zhong baoshen said that the assets available for acquisition at this stage usually have a high debt burden. if acquired, it may bring a large debt burden to the company, and the production capacity of the target is not what the company needs. in terms of industrial integration, the company will choose to continue to observe. at the same time, normal industrial cooperation exists for a long time. in the future, it may still support and transform the production capacity of partners through cooperation and incorporate them into the company's common ecology.
thepaper.cn reporter yang yang
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