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China's solar PV makers have to stand on own feet, analysis

Post Time:Mar 04,2009Classify:Industry NewsView:439

Chinese solar photovoltaic (PV) enterprises have to rely on themselves to go through global economic downturn and market shrinkage, industry analysts here agreed. 

Zou Hui, analyst with Orient Securities, said it's not likely for Chinese government to provide subsidies for solar PV installment in the near term and the government prefers wind power and nuclear power taking consideration of power generation cost.

Many small-sized PV companies have gone bankruptcy and large-scale ones are struggling for relief from loss of orders and market shrinkage, said Zou.

Meanwhile, it's doomed to see oversupply of solar PV products in 2009 due to market shrinkage and product capacity growth.

Chinese manufacturers of solar wafers, cells and modules usually heavily rely on overseas market in terms of material supply, market and technology.

Zou added that it wouldn't see significant policy-driven improvement of solar PV industry in the United States soon despite of bright outlook brought by ambitious plan by Obama administration.

An analyst with CLSA Securities suggests investors adopt a conservative manner in short run taking account of the impact from price plunge and sluggish demand.

It's reported that more than 300 PV module companies have gone bankruptcy in China since last October leaving about 50 ones in operation.

Industry watchers anticipate mergers and acquisitions among solar PV companies so as to phase out players with backward technology and weak company governance.

China-based public listed PV companies also are speculated to see possible take-over in the secondary market.

The stock prices of SunTech Power Holdings Co., Ltd. (STP.NYSE), LDK Solar Co., Ltd. (LDK.NYSE) and Trina Solar Limited (TSL.NYSE) plunged by more than 85 percent within last 52 weeks, compared with less than 50 percent drop of S&P index.

Source: Xinhua Author: shangyi

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