Oriental Sunrise plans to develop 1GW photovoltaic power station

A billion yuan was set up to establish a joint venture company to invest in photovoltaic power stations. After the completion of the establishment, the company holds 75% of its shares, and Risheng Hong Kong holds 25% of its shares. In the next three years, the joint venture company will develop a total installed capacity of photovoltaic power plants of 1,000MW, of which the installed capacity of photovoltaic power plants planned for development in 2014 will be 300MW. Industry experts estimate that the scale of investment for a 1,000 MW photovoltaic power station will reach approximately RMB 10 billion, and that in 2014, only RMB 3 billion will be required for Eastern Sunrise.

Ten billion ambitions Oriental Sunrise announced that the company and Risheng Hong Kong are planning to establish Dongfang Risheng Power Investment Co., Ltd. (tentative name) with their own funds of RMB 50,000 million. After the establishment of the company, the investment projects will include but not Limited to: Invest in distributed photovoltaic power plants, centralized photovoltaic power plants, etc. by wholly-owned or cooperative means. In the next three years, the company and Oriental Risheng Power Investment Co., Ltd. (tentative name) plan to develop a total installed capacity of photovoltaic power plants of 1000MW through the use of self-owned funds and supporting funds from bank loans, corporate bonds, and additional financing channels.

A photovoltaic analyst told the China Securities Journal that in accordance with current industry investment estimates, 10MW photovoltaic power plants need to invest 100 million yuan, and 1000MW investment amount should reach 10 billion yuan, which is almost the same as last month’s Hairun photovoltaic announced The billions of large bills built by Inner Mongolia are compared. In addition, Oriental Sunrise also announced that it plans to develop a photovoltaic power plant installed capacity of 300MW in 2014. In 2014, the total scale of photovoltaics allocated by the National Energy Administration to Zhejiang Province was 1,100 MW.

According to Oriental Sunrise, the company's decision is mainly based on the judgment of the development trend of the photovoltaic industry and related policies, in order to seize this opportunity to expand the company's industrial chain and increase the company's profit growth.

The benefits of selling power stations are big. "The investment amount of RMB 3 billion next year is not too small. The company should still hope to be able to boost the sales growth of the components through the construction of the power station, and gain revenue through the sale of power. However, how to solve the project funds should be paid attention by investors. Otherwise, it became a picture.” Analysts told the China Securities Journal that in the first half of 2013, the net profit after the devaluation of Oriental Sunrise was 22.85 million yuan, a year-on-year decrease of 18.45%; although the cumulative net profit in the first three quarters was 508.630 million. Yuan, but the company’s accounts receivable has increased from 589 million yuan at the end of last year to 680 million yuan.

Several PV module manufacturers announced that they had to withdraw from the photovoltaic power station construction due to a long capital chain. The president of Huieng Yangguang, Ren Kai, told reporters that “the investment in power plants by component companies is in order to increase module sales and achieve higher profits. The amount is very large, and the return on investment is basically over 8 years. There is not enough cash flow, and it is inevitable that the module makers exit the photovoltaic power station construction.”

Zhou Xuhui, an analyst at Shenyin Wanguo, said that listed companies can raise their stock prices through power plant construction to raise stock prices and then raise funds in the secondary market, and reinvest the acquired funds into the construction of power stations.

However, Oriental Sunrise is more optimistic. In the announcement, the company emphasized that the company's financing capacity is strong and there are sufficient funds to protect the company's good operations and development. It also believes that the current national PV subsidy policy will be of great help to the construction of photovoltaic power plants. The photovoltaic industry will continue to be strong as one of the main sources of new clean energy supply. In the future, it will be able to obtain returns by operating power stations or selling power stations once.

In the first half of 2013, Oriental Sunrise achieved sales revenue of 253 million yuan through the sale of European photovoltaic power stations. The power station business led to a significant increase in revenue for the first half of the year. Zhang Hao, a research fellow at Haitong Securities, believes that the future power station business will become the company's biggest growth point.

However, East Risheng also frankly stated that the project income depends on the size of the country's subsidies for photovoltaic power generation on-grid tariffs at the time of first grid-connected power generation after the completion of the power station. Before the project is completed and connected to the grid for power generation, the state will reduce the subsidies for the on-grid tariff of solar photovoltaic power generation, and the project's revenue will be negatively affected.