Recently, with the end of the annual report disclosure, listed companies have also held performance briefings one after another. Among them, several special performance conferences organized by the Shanghai Stock Exchange have triggered a lot of discussions, especially several special sessions involving new energy companies. It shows the current quite different living conditions and concerns of upstream and downstream companies.

Power companies with stable performance gradually increase new energy business layout

on may 6, the Shanghai stock exchange launched the "ESG theme week" of the Shanghai main board company performance briefing, which includes two industry group briefing sessions of "clean and low carbon" and "high bonus and heavy return. In the first clean and low-carbon special session held on May 8, the seven participating enterprises are mainly downstream power generation companies in the energy field , among which there are clean energy power enterprises whose main businesses are hydropower, nuclear power, etc, for example, Changjiang Electric Power (600900.SH), Three Gorges Energy (600905.SH), Laurel Electric Power (600236.SH), Huaneng Hydropower (600025.SH), a subsidiary of Huaneng Group, the five major central power enterprises, and China Nuclear Power (601985.SH), the leader in the nuclear power field, have also been mainly engaged in thermal power in the past.

in general, among the seven enterprises, except laurel power's revenue and net profit decreased significantly year-on-year in 2023 (revenue decreased by 23.85 and net profit decreased by 61.8), the performance of other enterprises was stable and net profit increased. however, except for the state investment power, which increased by 64.31 year-on-year, other increases did not exceed 25%, and the decline or growth in revenue was also within 25%, among them, the revenue of Changjiang Electric Power and China Nuclear Power exceeded 70 billion yuan. The former achieved a net profit of 27.239 billion yuan to the parent, and the latter also reached 10.624 billion yuan, which is the leader in their respective fields.

Of course, the special event is called "Clean and Low Carbon", and the content is mostly centered on this theme. Among them, hydropower enterprises generally encountered the problem of dry water last year. According to the "2023-2024 National Power Supply and Demand Situation Analysis and Forecast Report" issued by the China Power Union, last year, the hydropower generation in power plants above designated size in my country fell by 5.6 year-on-year. The business development of hydropower enterprises is also under certain pressure. However, Changjiang Electric Power still relies on the perfect layout of its six cascade power stations to achieve a 5% increase in total power generation. Its performance also swept away the "haze" of two consecutive years of revenue and net profit year-on-year decline in 2021 and 2022, achieving an increase of more than 10%. Coupled with the high dividend expectation and the concept of Chinese special shares, the company's share price has also risen by about 25% this year, in the first quarter, it successively set a new high in market value since its listing. This also shows the foundation formed by my country's traditional hydropower renewable energy companies after years of development and layout. At the collective briefing meeting, many companies also emphasized the importance of hydropower for "double carbon", The importance of energy transformation.

compared with hydropower, at present, more attention is paid to the layout of new energy sources by various power enterprises . this involves not only the energy transformation of traditional power enterprises , but also the development speed of new energy sources based on wind power and photovoltaic in China . On this issue, all enterprises have shown a more positive attitude. For example, Three Gorges Energy is focusing on the development of offshore wind power, which is considered to be the "future of wind power". As of the end of 2023, the company's installed capacity of offshore wind power is about 5.5 million kilowatts, ranking first in China. Sun Wei, chairman of Huaneng Hydropower, also said that the company adheres to the two key points of hydropower and new energy development. In 2023, new energy will be put into operation to increase the installed capacity. By the end of the year, the installed capacity of new energy will reach 1.9281 million kilowatts. The installed capacity of new energy will reach 10 million kilowatts in the entire "14th Five-Year Plan". 84 new energy projects are expected to be started and continued in 2024, with a planned investment of 13.991 billion billion yuan. Other hydropower companies have similar plans.

enterprises with more thermal power business are also facing more arduous tasks of low-carbon transformation. SDIC Power revealed that by the end of the 14th Five-Year Plan, the company plans to install 17 million kilowatts of new energy, accounting for 30%, and the installed capacity will exceed that of thermal power. Guangzhou development general manager Wu hong said that the company plans to realize the "3:3:8" pattern of installed power generation by the end of the 14th five-year plan, I .e. 3 million kilowatts of coal power, 3 million kilowatts of gas power and 8 million kilowatts of new energy power generation .

in the field of nuclear power, China's nuclear power in addition to welcoming another boom in nuclear energy development, it is also stepping up its layout in new energy fields such as wind power, photovoltaic and energy storage. the company said at the performance meeting that as of March 2024, the company had more than 21.3406 million kilowatts of new energy in operation, 679000 kilowatts of independent energy storage power stations and 14.2626 million kilowatts of new energy under construction; in 2024, the company will continue to adopt the development strategy of "nuclear power + new energy" two-wheel drive to realize the transformation from "single type" player to "all-round type" player , with the annual new energy plan generating 32.4 billion kwh.

in fact, after jumping out of the special performance meeting, China's traditional thermal power enterprises finally "returned blood" last year due to the fall in coal prices, and their new energy business layout also further accelerated. The performance of the five major power generation groups (Huaneng, Huadian, Datang, Guodian Investment and National Energy Investment Group) has turned losses into profits or achieved a big increase. On this basis, the installed capacity of new energy has also increased significantly, and the profit contribution of related sectors has become increasingly prominent. For example, Huaneng International (600011.SH) has increased the installed capacity of wind power to 11.4, photovoltaic to 9.7, and the total profit of the former has reached 5.913 billion yuan, it is more than 13 times that of the coal-fired business, and the total profit of the latter also reached 2.044 billion yuan, an increase of nearly 80% year-on-year, which is close to 5 times that of the coal-fired business.

the active layout of power enterprises in new energy installation has enabled the scale and growth rate of new energy installation in China to reach the highest level in history in 2023, with photovoltaic installation reaching 216.88GW, up 148 year on year . In the plans previously announced by the major central enterprises with major installed capacity, by the end of the "14th Five-Year Plan", the proportion of non-petrochemical energy installed capacity will generally increase to about half. Greenpeace also analyzed in the latest report that in recent years Renewable energy has become the main body of China's installed capacity and power generation increase. By the end of the "14th Five-Year Plan", it is expected that the annual increase in non-fossil energy power generation can meet the new social electricity demand, and this will undoubtedly further stimulate China's downstream demand market.

Upstream new energy manufacturing enterprises explore ways to deal with performance pressure

although the demand in the downstream market is growing rapidly, the pace of expansion in the upstream manufacturing end of new energy in China seems to be "one step ahead". still taking photovoltaic as an example, the output of the four main links in the photovoltaic manufacturing end in China increased by more than 60% in 2023, of which the output of components used for terminal installation reached 499GW, up 69.3 year on year. In terms of price, whether it is photovoltaic, wind power or new energy storage, they are facing a continuous "price reduction tide", and the competition among enterprises is becoming more and more fierce . In this context, the performance of enterprises in the new energy manufacturing sector is generally under pressure.

on may 7 , the Shanghai stock exchange held the 2023 science board photovoltaic special performance presentation meeting , three photovoltaic manufacturing leaders, Jingke Energy (688223.SH), Trine Solar Energy (688599.SH), Artes (688472.SH), Shichuang Energy (688429.SH), which has a layout of photovoltaic auxiliary materials and main materials, and Electrical Wind Power (688660.SH), whose main business is wind power but also dabbles in the photovoltaic field, all attended the briefing.

for the current situation of the industry, Jingke Energy Chairman Li Xiande said that the current domestic photovoltaic industry chain prices are at a low level, the industry-wide profit pressure. The market competition is particularly fierce in the first quarter, and it is expected that some uncompetitive production capacity will be eliminated at an accelerated pace. In fact, the performance of these three leading companies has been regarded as the "top students" in the leading echelon in the photovoltaic sector from last year to the first quarter of this year. In 2023, both revenue and net profit increased. Although the first quarter of this year declined year-on-year, it still maintained profitability, while other leading companies such as Tongwei (600438.SH) and TCL Central (002129.SZ) all suffered a double decline in revenue and net profit last year, tongwei lost 0.787 billion yuan, TCL Central lost 0.88 billion yuan, Jingao Technology (002459.SZ) lost 0.48 billion yuan, Longji Green Energy (601012.SH) lost 2.35 billion yuan.

In this context, companies have also talked more about how to deal with it. Among them, "going to sea" and "N type substitution" have become keywords .

In terms of going to sea, the overseas vertically integrated production bases in Southeast Asia and the profit highland of the United States are the focus . Trine Solar said that the company has built 6.5GW of integrated production capacity of silicon wafers, batteries and components in Southeast Asia, and will further deepen the layout of overseas production capacity in 2024. Its 5GW of U.S. component production capacity is already under construction and is expected to be put into production in the fourth quarter of this year. In addition, Vietnam's 5GW of silicon wafer battery production capacity and Indonesia's 1GW of battery component production capacity will also be built and put into production as planned. Jingke also disclosed that the company's 1GW expanded N-type module production capacity in the United States has been put into production in the first quarter of this year, which will play an important role in the US market. Artes has a more extensive layout, covering not only Europe and the United States, but also in-depth business layout in Japan, Australia, Latin America and other places. Xu Xiaoming, the company's board secretary, said that the company's main profit contribution in the first quarter came from overseas markets, and it will continue to enhance its global layout capability in 2024.

"technology upgrade" and "n-type substitution" are recognized as another big opportunity . the above three leaders are also enterprises with earlier layout in n-type technology. jingke also regained the position of "sales crown" of global components last year by "counterattacking" longji with the volume of n-type production capacity. All three companies said that 2024 is the year of technological upgrading, and believe that the performance of N-type products will determine the future industry pattern to a certain extent. It is worth mentioning that the three companies are currently mainly developing TOPCon technology in the N-type. As for the high-profile technical route dispute, Artes Chairman Qu Xiao Hua said that TOPCon has received the attention of most first-line companies in the past two years and is expected to remain the mainstream in the short term. As time goes by, HJT, BC, perovskite and other companies are expected to have suitable application scenarios and development space.

the performance pressure of the wind power industry, another major new energy force, appeared as early as two years ago. this year, the situation is even more severe. the net profits of leading wind technology (002202.SZ) and mingyang intelligence (601615.SH) have all declined. the electric wind power industry participating in the above-mentioned special field has suffered a loss of 1.271 billion yuan. the company said at the explanation meeting that in addition to doing a good job in the main wind power business, it will alsoThrough the subsidiary will build a production base of 1.2GW of high-efficiency heterojunction photovoltaic cells and modules to enhance diversification capabilities. Previously, titanium media APP also mentioned in the article (wind turbine manufacturers under pressure in performance began to find a new way out). At present, wind power enterprises are constantly exploring diversified layout in energy storage, hydrogen energy, zero carbon and other fields.

in addition, the Shanghai stock exchange also held a science board battery special performance briefing on may 9. lithium battery enterprises such as fu neng technology (688567.SH), huasheng lithium battery (688353.SH) and pa neng technology (688063.SH) participated in the meeting. Last year, the lithium-ion demand market continued to grow, but the upstream manufacturing competition also tends to be white-hot, facing price cuts, performance pressure, lower stock prices and other issues. Various companies also focused on the industry's response methods at the briefing. Among them, the "Lithium Battery Industry Standard Conditions (2024 Edition)" (Draft for Solicitation of Comments) and "Lithium Battery Industry Standard Announcement Management Measures (2024 Edition)" (Draft for Solicitation of Comments) issued by the Ministry of Industry and Information Technology on May 8 triggered heated discussions. Many companies stated that relevant documents are important policies in the industry, can promote capacity clearance, eliminate low-end capacity, guide enterprises to upgrade technology, standardize development . In addition, new technologies and new formats have also become key words in the development plans of various enterprises. For example, Yifei Laser (688646.SH) and Liyuan Heng (688499.SH) have all mentioned the research and development layout of new technologies such as solid-state batteries and sodium batteries. Funeng Technology has also mentioned the development of eVTOL market.

it is worth mentioning that although the new energy manufacturing industry has encountered certain difficulties, most of the enterprises participating in the performance briefing expressed optimism. Tan Wen, president of Paneng Technology, believes that the inventory situation of the energy storage industry has gradually improved and will enter rational development after the cycle of competition and industrial reshuffle. Funeng Technology also said that the first quarter of this year's results showed optimistic signs. Jingke, Trina Solar, Artes all said that their own orders in hand are sufficient, and the industry chain prices have been low, continue to irrational decline probability is small, the future supply and demand relationship is expected to gradually improve.

and on the evening of may 10, Tongwei shares issued a public announcement, announcing that it had signed an order for 862400 tons of silicon with longji, setting a new high in the scale of silicon orders for the year (based on the current average price of silicon, the value of the order is about 39.1 billion). the two leaders with greater performance pressure signed a large order at this time, which was also interpreted by some industry insiders as less room for further price reduction in the photovoltaic industry, the signal that it will gradually stabilize from its lows. Author | Hu Jiameng , Editor | Liu Yangxue )