Financial News Agency, December 14 (Reporter Liu Mengran) In this round of photovoltaic overcapacity, batteries are a “rising force” link, and the replacement of advanced production capacity such as TopCon and heterogeneity continues to accelerate. This evening, Elken Technology (002610.SZ) announced plans to invest 2.1 billion yuan in heterojunction battery projects. However, for the current situation where the cumulative amount of external guarantees exceeds 10 billion yuan, high financial risk is still the greatest pressure on future production capacity expansion.

This evening, Elken Technology announced that its wholly-owned subsidiary Ganzhou Elken Optoelectronics will invest in the construction of a 4.6GW heterojunction battery production project, with a total fixed asset investment of 2.1 billion yuan. The project will add 1 new 600MW and 5 800MW heterojunction battery production lines, and plans to increase production capacity in batches and line by order.

According to the company's disclosure, up to now, the company has received orders for heterojunction components of about 2.95GW, and the company's own production capacity for heterojunction batteries cannot meet the order requirements. The company plans to complete the entry of the main equipment for the first heterojunction battery production line in January 2024.

Elken Technology will enter heterojunction battery module production in 2021. It is expected that by the end of this year, the Changxing base in Huzhou, Zhejiang will complete the production capacity of 2GW of high-efficiency N-type batteries, the Ganzhou base in Jiangxi will complete 4.5GW of high-efficiency N-type battery production capacity, and the Zhejiang Zhoushan base will complete the 3GW high-efficiency N-type battery production capacity.

In the first three quarters of this year, the company's net profit turned a loss into a profit, achieving operating income of 3,717 billion yuan, a year-on-year decrease of 14.04%; net profit was 20228,400 yuan, a loss of 272 million yuan in the same period last year. However, in the Q3 quarter, net profit attributable to the company still lost 25.932,900 yuan.

The greater pressure on Elken Technology comes from guarantee risks. As of December 12 this year, the latest announcement on the disclosure of progress in providing guarantees shows that the total amount of external guarantees reviewed by the company and its holding subsidiaries has reached 10.991 billion yuan. The maximum amount of accumulated actual external guarantee contracts accounted for about 279.61% of the company's most recent audited net assets, and the cumulative financing balance under external guarantee contracts accounted for 124.66% of the most recent audited net assets.

The issue of external guarantees that far exceed net assets has also been questioned by the regulatory authorities. This year alone, the company has already received letters of concern from the Shenzhen Stock Exchange three times, requesting that the focus be on whether guarantee risks are manageable, etc. In its response, the company stated that there were no situations where the controlling shareholder, the actual controller, and their related parties occupied the company's funds in a non-operating manner or provided guarantees in violation of regulations.

Currently, heterogeneity is still in the early stages of industrialization development, and capital requirements are high. An industry analyst told a reporter from the Financial Association that compared to TopCon technology, which was first implemented. Cost is still the main challenge facing heterojunction batteries, and it is also necessary to continue to reduce costs through silicon reduction, silver reduction, etc. Furthermore, judging from Elken Technology's current disclosure, its GW fixed asset investment alone still exceeds 450 million yuan.

However, the efficiency advantages of heterojunction photoelectric conversion still determine that it has stable market space. As of the first half of the year, the average conversion efficiency of Elken single-sided microcrystalline heterojunction batteries was 25.3%-25.5%, the highest batch could exceed 25.6%, the production yield was 98%, and it is expected that mass production of double-sided microcrystalline heterojunction batteries will be introduced in the fourth quarter. The average conversion efficiency is expected to exceed 25.6%-25.7%.