Photovoltaic industry financing under pressure A-share company intensively sells power station assets

Abstract Editor's note: What actions does the relevant listed company take after the “531 New Deal”? How will the performance change again? What is the evaluation of industry experts? Today, this newspaper once again focuses on the photovoltaic industry and hopes to provide a useful investment value reference. In late June, by...

Editor's note: After the "531 New Deal", what kind of action does the relevant listed company take? How will the performance change again? What is the evaluation of industry experts? Today, this newspaper once again focuses on the photovoltaic industry and hopes to provide a useful investment value reference.

Since late June, A-share companies have issued announcements on the trading of PV power plant assets, which seems to be more intensive than ever.

According to the combing, in the short period of more than ten days from the end of June to the present, only the A shares of the photovoltaic power plant asset trading announcement involving Longji, Zhengtai Electric, Aerospace Electromechanical, Kelu Electronics, Oriental Risheng, Amarton, etc. 6 listed companies, and installed capacity of more than 200MW.

Market speculation that the move to sell power plant assets may be related to the “531 New Deal”; in particular, the seller may face pressure from cash flow.

Regardless of the cash flow problem, it is worth noting that it is worth noting that an unnamed power equipment and new energy industry analyst told reporters that "the same renewable energy industry, recently, relative to wind power can get Bank loan interest rates are around 5%, PV companies are generally above 6%, and high even reach 10%."

What is more serious is that a bank staff member said, “Although bank loans are not too much reference to industry analysis, the situation is mainly evaluated separately. However, PV is indeed an industry that bank loans are not too involved. It is not a question of opening high interest rates, but it is difficult to grant loans. At the same time, with the strict management of the off-balance sheet business (trusts, etc.) of the banking industry this year, some enterprises have few other financing channels besides loans and debt issuance. ”

A-share company

Photovoltaic power plant asset intensive sale

On the evening of July 2, A-share listed company Zhengtai Electric announced that Zhejiang Zhengtai New Energy Development Co., Ltd. (Zhengtai New Energy), a wholly-owned subsidiary of the company, purchased 17 distributed photovoltaic project companies from six subsidiaries of Longji. The equity of the project involves a project capacity of 106.3MW and a total equity transaction transaction price of 703 million yuan.

Although for this transaction, Longji shares did not issue an announcement, but in an interview with relevant media, Longji shares said that Longji is mainly engaged in the manufacture of monocrystalline silicon wafers and battery components, and the power station development business as an auxiliary, so the company's power station The development itself is rolling and not for long-term holding. The sale of power stations will be based on revenue and is not directly related to the “531 New Deal”.

For example, after selling the power station assets here, on July 11, Longji shares announced that the company's wholly-owned subsidiary Lingwu Longqiao Photovoltaic New Energy Co., Ltd. received the "National Network Ningxia Electric Power Co., Ltd." on July 9. Notice on the Operation of the 228MWp Photovoltaic Power Generation Project of Lingwulong Bridge (Ningdian [2018] No. 74). This means that Longji's 228MW photovoltaic power generation project in Majiatan Town, Lingwu City, Ningxia, which was decided by the wholly-owned subsidiary in March this year, was connected to the grid on June 29 this year.

In addition to Longji shares, Aerospace Electromechanical Co., Ltd., a 100% stake in Shanghai Yaoyangfu Power Co., Ltd., which is publicly listed and sold by the Shanghai United Assets and Equity Exchange, was also sold recently. According to the relevant announcement, the total transaction price of 100% equity of Shanghai Yaoyangfu Power Co., Ltd. was 18.2 million yuan, and the company holds a storage capacity of 5MW for photovoltaic power plants.

The buyer who acquired the 100% equity of Haiyao Sunshine Power Co., Ltd. is the shareholder of Aerospace Electromechanical Co., Ltd. - Shanghai Aerospace Industry (Group) Co., Ltd., and the relevant announcement shows that in addition to the 18.2 million yuan paid to the listed company Aerospace Electromechanical through the property rights exchange. In addition to the equity transfer, Shanghai Aerospace Industry (Group) Co., Ltd. is also required to pay 30 million yuan in debt for Shanghai Yaoguangfu Power Co., Ltd.

In addition, A-share company Kelu Electronics announced on June 28 that the company's wholly-owned subsidiary, Shenzhen Kelu Energy Service Co., Ltd. and another A-share company, Dongfang Risheng Subsidiary Co., Ltd., Dongfang Risheng (Ningbo) Power Development Co., Ltd. signed the “Photovoltaic Power Project Project Cooperation and Equity Transfer Agreement”, and Kelu Energy Company intends to transfer 100% of its holdings of Ningxia Xuning New Energy Technology Co., Ltd. to RMB 270 million to Dongfang Risheng ( Ningbo) Power Development Co., Ltd. According to public information, the 30MW photovoltaic power generation project built by Ningxia Xuning has been connected to the grid for power generation on January 1, 2015, with a generating capacity of approximately 43.8 million kWh/year.

Whether or not

Related to tight cash flow

In addition to the above-mentioned Longji shares, Aerospace Electromechanical, and Kelu Electronics, on July 14, A-share company Amarton also announced that the company intends to sell 100% of its shares in Nanjing Jinghong New Energy Co., Ltd. to Tianjin Fuhuan. Enterprise Management Consulting Co., Ltd. makes it indirectly hold 100% equity of Pu'an Zhonghong New Energy Co., Ltd. and its assets of the 50MWp agricultural photovoltaic power generation project under the Pu'an County.

According to public information, the total transaction price was 370 million yuan, of which Tianjin Fuhuan will also repay the debts incurred by Pu'an Zhonghong on the financing lease of photovoltaic power station projects (about 190 million yuan). The announcement shows that Tianjin Fuhuan is a wholly-owned subsidiary of Beiqing Clean Energy Investment Co., Ltd.

It is worth mentioning that Amarton admitted through the announcement that the PV power plant investment operation business is a heavy asset industry. As the company's related assets expand, the company's financial pressure is also increasingly prominent. In order to alleviate the above pressure, the company began to gradually adjust the photovoltaic business development strategic plan from the second half of 2017, selling photovoltaic power plant assets, reducing debt and bringing in cash flow recovery will help the company reduce financial expenses and improve asset liquidity.

In fact, according to the company's 2018 quarterly report mentioned above, the net cash flow generated by several companies' current business activities is negative. In the light of the above, the net cash flow generated by Company A's operating activities increased year-on-year, but at the same time, the net cash flow generated by the company's fund-raising activities decreased (positive value) year-on-year; the net cash flow generated by Company B's operating activities increased year-on-year. The net cash flow from financing activities decreased significantly year-on-year (negative this year, positive value last year); the net cash flow generated by C company's operating activities decreased year-on-year, and the net cash flow from financing activities increased significantly (negative value); The net cash flow from operating activities of Company D decreased significantly year-on-year, and the net cash flow from financing activities decreased significantly (negative value) year-on-year.

On this basis, Shen Meng, executive director of Xiangxi Capital, told reporters that “the total number of fixed assets and construction in progress of A and B companies has increased year-on-year, and the net cash inflow from operating activities has also increased, resulting from fundraising activities. The net cash inflow is decreasing, indicating that the project as a whole begins to enter the production return stage, the project begins to generate cash flow, and can invest in new projects. Therefore, the cash flow pressure of A and B companies is reduced and the whole enters a virtuous circle."

“The net cash inflows from C and D operations continued to decrease, indicating that the projects are still in the early stage of construction and need to continue to invest in blood transfusions, but the net cash inflow from C financing activities is also increasing simultaneously, indicating their funds. The chain is relatively balanced. Only the net cash inflow from D company's fundraising activities is also decreasing, indicating that its project financing may encounter major obstacles, which will lead to a tighter capital chain for listed companies." In Shen Meng's view, According to the situation of these four listed companies, it is impossible to conclude that the photovoltaic industry has tight cash flow before seeking asset sales."

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