JinkoSolar Holding CEO ( JKS , quote ), Chen Kangping said today that China's solar panel manufactures should begin to see a recovery in solar power as soon as this year.
Mr. Kangping went on to say "We believe those companies that perform well, including Jinko, will be profitable in the second half of this year," and those remaining Chinese solar companies that can survive the turn in 2013 should be able to print a profit next year.
JKS is now seeing order volume being to approach saturation levels for production. This is key for JKS as it puts the company in the driver's seat and allows the company to be more selective on which orders they process first allowing for higher profit margins from their larger long term clients.
With China's government shift to power generation projects in solar and other clean energies, Li Hejun, chairman of the China New Energy Chamber of Commerce is expecting nearly 10 trillion yuan or roughly $1.6 trillion U.S. dollars in value over the next few years.
He went on to say during his speech at the Chinese People's Political Consultative Conference that even though the domestic (China) is promising and strengthening, the global market in the space continues to be challenging.
When asked during the conference where Mr. Chen saw opportunities he said emerging markets of Africa, Middle East and Southeast Asia are promising. He went on to say there is less competition in these markets and are focused on getting service rather than price.
With close to an 85% drop in JKS' stock price from 2010's high of $41.75 due to production overcapacity and now that the JKS is looking to emerging markets and the possibility of more consolidation within in these markets JKS should be able to maintain strong margins as it expands into emerging markets.
Bottom Line : JKS is back on my radar as an early speculative play. There is no rush to jump into this name and with the stock being listed in New York Stock Exchange I'm waiting for an overall U.S equity market to pullback and grab a better entry point in JKS.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
