On the evening of October 30, JinkoSolar Co., Ltd. (hereinafter referred to as "JinkoSolar") released its third quarter 2024 report. According to the report, in the third quarter of 2024, JinkoSolar's revenue was 24.519 billion yuan, and the net profit attributable to the parent company was 14.8742 million yuan, deducting the net profit attributable to the parent company of 259 million yuan. In the first three quarters, the company's revenue was 71.770 billion yuan, the net profit attributable to the parent company was 1.215 billion yuan, and the net profit not attributable to the parent company was 476 million yuan. It is worth noting that from January to September 2024, the company's gross profit margin increased from 8.57% from January to June to 9.68%, showing that the company's profitability is constantly increasing. Among them, the company's gross sales margin in the third quarter was 11.82%, compared with 7.60% in the second quarter, an increase is more significant.

Shipments increased by 31.29% year-on-year, continuing to maintain the global lead

JinkoSolar (688223. SH) is mainly engaged in the R&D, production and sales of photovoltaic modules, silicon wafers and photovoltaic cells, as well as the application and industrialization of photovoltaic technology, and on this basis, it provides high-efficiency and high-quality solar photovoltaic modules and energy storage products to global customers, and continues to deliver clean energy. The company's main products are photovoltaic modules, photovoltaic cells and silicon wafers.

According to data from the China Photovoltaic Industry Association (CPIA), in the first half of 2024, domestic polysilicon production will be about 1.06 million tons, a year-on-year increase of 60.6%; the output of silicon wafers was about 402GW, a year-on-year increase of 58.9%; cell output was about 310GW, up 37.8% year-on-year; Module production was about 271GW, up 32.3% year-on-year. With the increase in production, the prices of polysilicon and wafers fell by more than 40%, and the prices of cells and modules fell by more than 15%. In such an environment, the company's gross profit margin in the third quarter increased from 7.60% in the second quarter to 11.82%, which is not easy.

At the same time, during the reporting period, the company achieved a sustained market share leadership with excellent product performance and global sales channels. In January ~ September 2024, the company achieved a total shipment of 73.13GW of photovoltaic products, of which module shipments were 67.65W, N-type modules accounted for about 85%, and silicon wafers and cell shipments were 5.48GW, an increase of 31.29% over the same period last year.

The performance of both shipments and profits shows that JinkoSolar's profitability is gradually improving. What is more noteworthy is that while some PV companies are borrowing on a large scale to increase external borrowing, JinkoSolar has also improved its asset-liability ratio, which decreased by 1.28 percentage points quarter-on-quarter in the third quarter. Operating cash flow increased significantly quarter-on-quarter, exceeding 1.2 billion yuan in a single quarter in the third quarter, demonstrating the steady and positive trend of the company's cash flow situation.

Technological innovation superimposes global layout to build a new development highland

Although China's photovoltaic industry is currently in the stage of cyclical adjustment, the global demand for new photovoltaic installed capacity still maintains steady growth. According to the International Energy Agency's July 2024 Electricity Mid-Year Update, global electricity demand is expected to grow by about 4% in 2024, the highest growth rate in a regular year since 2007. In the context of the global energy transition, the market demand for solar photovoltaic power generation is expected to reach a new high thanks to the continuous and substantial decline in costs.

The company's photovoltaic products are currently mainly monocrystalline modules, combined with the diversified market demand worldwide, the company has applied N-type TOPCon, bifacial (including double glass and transparent backsheet technology), half-cell, overlap welding, multi-busbar, large-size and other cell and module process technologies, and has developed and launched a number of series of photovoltaic module products in a differentiated manner. In the first three quarters, the company's R&D investment totaled 3.611 billion, accounting for 5.03% of operating income. The company is committed to consolidating and strengthening its leading edge in N-type technology, and continuously promoting the improvement of product mass production efficiency and power and the optimization of production capacity structure. JinkoSolar's newly launched Tiger Neo Gen 3 module achieves a maximum power of 670W and a maximum module conversion efficiency of 24.8%, which is the highest performance module released on the market and marks the company's industry leadership in technological innovation. At present, JinkoSolar's N-type TOPCon shipments in the first three quarters of 2024 have accounted for more than 85%.

Relying on its significant advantages in the technology field and excellent operation and management capabilities, the company said that it will be possible to achieve 90-100GW of shipments for the whole year, while better balancing shipments and profits, which also booked the title of this year's module shipment champion in advance.

It is worth noting that in January ~ June 2024, the company's module products accounted for about 65% of overseas market shipments, and overseas revenue accounted for about 71%, a further increase year-on-year. The company said that the company's global channels and brand power, as well as the contribution of overseas markets with high gross margins such as the United States and the Middle East, have formed an effective support for the company's profits. Emerging markets are becoming JinkoSolar's main strategic layout in 2024. According to the company's semi-annual report, the company's market share is about 50% in the Middle East photovoltaic module market, where demand is released in large quantities; In the fast-rising Pakistani market, the company has signed more than 4GW of orders throughout the year; In the growing Thai market, the company's market share has further increased.

In July 2024, JinkoSolar announced that its wholly-owned subsidiary, JinkoSolar Middle East, signed an agreement with shareholders such as the Public Investment Fund of the Kingdom of Saudi Arabia to jointly establish a joint venture to build and operate a 10GW high-efficiency photovoltaic cell and module project in Saudi Arabia, which is the company's fourth overseas factory in operation.

On October 20, 2024, JinkoSolar announced that it intends to issue overseas GDRs on the Deutsche Stock Exchange, and the total amount of funds to be raised will not exceed 4.5 billion yuan (or equivalent in foreign currency) for the construction of 1GW high-efficiency modules in the United States and 14GW integrated production base in Shanxi Phase II, as well as replenishment or repayment. The issuance will help the company attract incremental overseas funds, further optimize its financial structure, and strengthen its long-term core competitiveness. According to the research report of Guojin Securities, considering the company's technological advantages and leading global channel layout, it maintains a "buy" rating.

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