) has entered into a three-year agreement with Solairedirect SA.
Per the agreement, Solairedirect Technologies (Pty) Ltd, a South
African-based module manufacturing subsidiary of Solairedirect
SA, will produce 120 megawatts ("MW") of solar modules in South
Africa for ReneSola.
Also, the terms of the agreement require Solairedirect to
purchase 54 MW of solar modules. Out of this, Solairedirect
intends to utilize 20 MW of the solar modules for projects in
South Africa and 34 MW of the solar modules internationally.
Solairedirect expects to double its module production capacity in
2013. According to the additional terms of the deal,
Solairedirect's expansion of its module production capacity may
translate into additional solar modules for ReneSola.
Despite being a leading global manufacturer of high-efficiency
solar photovoltaic ("PV") modules and wafers, Renesola handed
over the responsibility to manufacture modules to Solairedirect
given its strong market presence in South Africa and its module
production capability and capacity. Solairedirect's products are
highly efficient and less sensitive to fluctuation in
temperature. Additionally, the abundance of solar energy, scope
for rapid economic growth and governmental support in South
Africa are expected to benefit the deal.
Import duty for solar panels in South Africa falls in the range
of 0% to 20%. This will automatically lower the cost of
production for ReneSola, thereby improving margins.
Meanwhile, South Africa has set a target of generating 42% of
electricity from renewable energy by 2030. It also plans to
heavily invest in clean energy to reduce carbon emissions and
bolster electricity supply. Therefore this deal and several
others in the offing will boost its clean energy initiatives.
JinkoSolar Holding Co., Ltd.
) entered into an agreement with a well-recognized solar project
developer (the "Developer"). Per the terms of the agreement,
JinkoSolar will supply high-efficiency solar panels totaling 115
MW for two projects in South Africa.
Coming back to ReneSola, the company enjoys a
geographically-diversified customer base. Moreover, the company
continues to focus on improving its operating efficiencies,
generating material cost savings through its
vertically-integrated production structure and introducing
However, tepid demand for solar products in Europe, rising
competition, credit risk from its customers, oversupply of solar
wafer & modules in the market, and the company's high
research and development expenses remain concerns. The company
presently retains a short-term Zacks Rank #2 (Buy).
Besides ReneSola, other stocks worth considering are
Canadian Solar Inc.
STR Holdings, Inc.
), both with a Zacks Rank #2 (Buy).
CANADIAN SOLAR (CSIQ): Free Stock Analysis
JINKOSOLAR HLDG (JKS): Free Stock Analysis
RENESOLA LT-ADR (SOL): Free Stock Analysis
STR HOLDINGS (STRI): Free Stock Analysis
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