Hainan Drinda New Energy Technology announced plans to invest $700 million to build a 10GW photovoltaic cell production capacity plant in Oman; TCL Zhonghuan Renewable Energy Technology, GCL Tech, Trina Solar Co., Ltd. and other major factories previously announced their intentions to invest and construct factories in the Middle East.
Facing the blockade in the European and American markets, Chinese photovoltaic companies are actively seeking new overseas production bases, and the Middle East is undoubtedly an ideal investment destination for many enterprises.
Jundu Co., Ltd. (002865.SZ), a manufacturer of photovoltaic cells, announced on Thursday evening that it has reached an investment intention agreement with the Omani Investment Authority to build a 10GW Topcon high-efficiency photovoltaic cell production capacity with a total investment of US$700 million. The project will be implemented in two phases, each with 5GW.
Jundu Co., Ltd. pointed out that as a global leading photovoltaic cell industry leader, in order to actively practice the global development strategy, deepen global customer service capabilities, meet the demand of overseas photovoltaic markets, and layout overseas high-efficiency battery production capacity, the company will continue to strengthen the offshore supply capacity of photovoltaic cells.
The company stated that as the core technological link of the photovoltaic industry chain, the establishment of this project will promote the formation of the Omani photovoltaic industry chain, attract more related supporting enterprises to settle in Oman, improve the living standards of local communities, increase Oman's employment rate, and contribute to Oman's decarbonization and carbon neutrality goals, supporting the "Oman 2040 Vision".
Jundu Co., Ltd. submitted an application for listing on the main board of the Hong Kong Stock Exchange in February this year. If it can successfully list on the Hong Kong stock market, Jundu Co., Ltd. will become the first A+H listed photovoltaic cell manufacturer in China. Company overview shows that the proceeds from the issuance of H shares will be used for the construction of overseas high-efficiency battery production capacity, overseas market expansion and overseas sales operation system construction, global R&D center construction and supplementary operation funds.
After the announcement of the investment plan in Oman, Jundu Co., Ltd.'s overseas layout has been basically revealed: raising funds through the Hong Kong stock market, establishing production bases in the Middle East, and focusing on the global market.
Building a local industrial chain
In recent years, countries in the Middle East have vigorously promoted the development of new energy industries in order to adapt to global carbon reduction actions and promote the diversification of their own economy.
The Middle East has long sunshine time, abundant light resources, and a good environment for photovoltaic development. Coupled with local policy support, the demand for photovoltaic installations has grown rapidly in recent years. According to statistics from Infolink Consulting, the demand for photovoltaics in the Middle East is expected to be about 20.5GW-23.6GW in 2023, and the market demand for photovoltaics in markets headed by Turkey, Saudi Arabia, and the UAE has increased substantially.
Not only have various countries in the Middle East invited global enterprises to provide photovoltaic components or participate in power plant construction, but they also hope to attract more enterprises to settle in their countries and build a local photovoltaic industry chain. The Chinese photovoltaic industry, which accounts for 80% of the global photovoltaic component market, has become an ideal target for investment promotion in various Middle Eastern countries.
China has currently formed a complete photovoltaic industry chain, with strong capabilities in upstream silicon materials and silicon wafer processing, midstream solar cell and components, and downstream photovoltaic power plant construction and operation.
Source: Jundu Co., Ltd.'s H-share prospectus
Many high-quality companies in the domestic photovoltaic industry chain have announced their investment intentions in the Middle East, such as silicon wafer giant TCL Zhonghuan Renewable Energy Technology Co., Ltd., which announced in October last year that it plans to sign a joint development agreement with Saudi Vision Industries to promote the construction of a photovoltaic silicon wafer project in Saudi Arabia with a first-phase target capacity of 20GW.
In May of this year, silicon material giant GCL Tech announced that it plans to jointly build a granular silicon production facility in the UAE with Mubadala, a state-owned sovereign fund in the UAE. The project is expected to start construction in 2024.
In addition to the upstream, midstream Chinese companies have also turned their attention to the Middle East market. Trina Solar signed a memorandum of understanding with ADPorts and Jiangsu Overseas Cooperation Investment Co., Ltd. for a UAE project in October last year. The planned capacity includes approximately 50,000 tons of high-purity silicon, 30GW of crystalline silicon wafers, and 5GW of battery components, which will be built in three phases.