ReneSola Ltd. (
) has entered into an agreement with BIG SOLAR S.A. (BIG SOLAR) for
the shipment of 100 megawatts ("MW") of its high-efficiency Virtus
modules. Per the deal, the company will ship its modules in the
coming one year directly to BIG SOLAR.
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BIG SOLAR S.A. is an established company in the Greek photovoltaic
sector. The branded equipment offered by BIG SOLAR includes panels,
inverters, monitoring systems and telemetry that are imported
directly from the respective photovoltaic (PV) companies, without
the mediation of resellers or retailers.
Virtus modules represent the highest technological advancement in
quasi-mono solar wafers and modules. They have the ability to
improve the average conversion efficiency of conventional multi
crystalline wafers from 16.5% to more than 18.2% that is equal to
or more than the efficiency of monocrystalline modules. Other
features include easy installation and handling, Mechanical Load
Capability of up to 5400 Pa and fulfillment of International
Electrotechnical Commission ("IEC") standards. It consumes much
less energy and has lower manufacturing costs in comparison to
monocrystalline modules that automatically helps in both reducing
the overall investment in photovoltaic systems and thereby
improving the rate of return on investment.
With this deal, the company also revised its guidance for total
solar wafer and module shipments. For the first half of 2012, the
company expects them to be close to 1 gigawatt ("GW"). Currently,
it expects its total solar wafer and module shipments to be in the
range of 2.2 GW to 2.4 GW as compared to the previously guided
range of 1.8 GW to 2.0GW.
The company expects to release its second quarter 2012 results on
August 3, 2012. The Zacks Consensus Estimates for second quarter
2012 and fiscal year 2012 are currently at a loss of 32 cents per
share and $1.23 per share, respectively.
ReneSola is a leading global manufacturer of solar wafers and solar
modules. We believe that this deal will help the company in
achieving its guidance. In addition to adding to the company's
strong position in key solar markets like Greece, the deal will
also boost global sales.
Year to date, the company has delivered 40 MW of high-efficiency
Virtus modules to Greece. Moreover, thanks to technological
advancements and commercialization of ReneSola's high-efficiency
Virtus modules, which have an average power generation of 255W, the
company's business is spread out globally. In September 2011,
Enerparc, a leading Engineering, Procurement and Construction
company in Germany, revealed that it also utilizes 27.5 MW of
ReneSola's standard Multi and Virtus high-efficiency modules for
its large-scale solar power plant in Gahro, Germany.
ReneSola Ltd. focuses on improving its operating efficiencies and
generating material cost savings through its vertically-integrated
production structure and the newly introduced diamond-steel wire
However, we are concerned about the tepid demand for solar products
in Europe (especially Germany), rising competition, credit risk
from its customers, oversupply of solar wafer & modules in the
market, and the company's high research and development expenses.
The company presently retains a short-term Zacks #3 Rank (Hold)
that corresponds with our long-term Neutral recommendation on the
Some of its main competitors include
LDK Solar Co. Ltd.
MEMC Electronic Materials Inc.