Emerging markets have become the new strategic markets for solar firms after trade prospects in the European Union soured due to recent anti-dumping investigations against solar products from China, top executives of a leading solar firm said.
Jiang Likai, deputy general manager of Solar Energy Technology Co, a unit of the State-run China Energy Conservation and Environmental Protection Group, said emerging markets such as Pakistan and Chile are the new targets for Chinese solar product makers, particularly countries along the Belt and Road Initiative in Asia, Africa and Europe, as exports to the traditional markets have been hit by trade disputes.
Solar Energy Technology Co had in April decided to buy the shell of a Chongqing-based pharmaceutical company named Chongqing Tongjunge Co Ltd in an equity swap deal, a practice commonly used by Chinese companies that want to get listed.
It will become the seventh listed company of CECEP once the asset replacement is completed. The six it currently owns cover wind power, geothermal energy, mechanical and electrical equipment and new materials. In addition, it will become China's first State-run solar power provider listed in the Shanghai Stock Exchange, according to a report by Guosen Securities Co.
Most listed solar power companies are privately owned, with limited resources in winning contracts and expanding financing, it said.
Solar Energy Technology Co has more than 60 solar projects nationwide, with a total installed capacity of solar energy power generation operated and under construction totaling more than 1.9 gigawatts, said Zeng Wu, assistant general manager of CECEP.
"Gross profit margin of the solar industry has rebounded to around 20 percent this year, higher than most manufacturing industries," Jiang told journalists at the company's manufacturing base in Zhenjiang, Jiangsu province.
The Purchasing Managers Index, a key gauge of manufacturing, slowed unexpectedly in July to a two-year low of 47.8, the fifth consecutive month of contraction partly because of slow growth in demand.
There are more than 50 robot manipulators, automatic devices that can produced materials without direct contact, in the manufacturing base covering 7,800 square meters and its annual revenue could reach more than 1 billion yuan ($156 million), he said. The base was established in August 2011 with total investment of 1.1 billion yuan.
"Half of our sales are from the domestic market. We have never suffered a loss even when the solar business was rather slack in previous years," said Jiang, adding most of their domestic clients are State-run enterprises.
CECEP is the only State-run company focusing on energy conservation and environmental protection. Its business includes clean energy, environmental protection and treatment and energy-efficiency construction.
