China Industry Report: Apr. 18

Posted by Reading Time: 6 minutes

Apr. 18 – This is a regular series of relevant industry news from around China.

Marine transport and shipbuilding
•Cargo transport services provider Cosco Shipping Co Ltd said its cargo throughput rose 15 percent year-on-year to 846,750 tons in March. Cargo turnover jumped by 17.1 percent to 5.35 billion ton-kilometers.

For the first three months of the year, the firm transported 2.03 million tons of cargo, up 7.3 percent on the year. Cargo turnover increased 9 percent to 12.3 billion ton-kilometers.

•Deep-sea cargo transport provider Cosco Shipping Co Ltd announced on April 11 a net profit of US$12.7 million for the first three months of 2011, up 57.5 percent on the year.

Operating revenue rose 20.4 percent to US$171 million. Earnings per share improved by 25 percent to US$0.008.

•Chinese transportation equipment maker China International Marine Containers (Group) Co Ltd said on April 13 it expects to record a net profit of between US$201 million and US$227 million for the first three months of 2011, versus US$54 million in the same period last year.

The firm attributed its good performance to the continuing strong demand for its dry cargo containers and to the growth of its energy, chemical and liquefied food businesses.

•Xiamen International Port said last Tuesday it expects to post a first-quarter net attributable profit of US$3.80 million, which is a considerable improvement on the US$2.27 million recorded a year earlier.

The company said it saw an increase in operating revenues from its terminal operations, tugboat berthing, logistics and building materials businesses.

Solar power
•Chinese solar components maker Hangzhou First PV Material Co and Canadian photovoltaic solar systems provider Astenik Solar Inc announced on April 8 that they have entered into a distribution agreement. Under the deal, Astenik will sell Hangzhou’s solar materials and products in Canada.

Set up in 1994, Hangzhou First PV Material operates three plants in China and is currently building a fourth one. In 2010, the company sold 6.6 gigawatts of its solar power products worldwide.

For the next two years, Hangzhou forecasts its ethylene vinyl acetate film production capacity would double with 100 automated lines and 2,000 workers.

•Chinese solar wafer maker LDK Solar said on April 11 it will pour US$35 million in the construction of a silane gas manufacturing line to tap growing demand from the semiconductor, flat-panel display and solar industries in Asia.

The new line, to be established at the company’s Mahong facility in Xinyu, Jiangxi Province, will be able to supply up to 2,000 tons of silane gas. Construction is expected to commence in the third quarter of this year, with production beginning in the second quarter of 2012.

“There is growing demand for silane in China, but there is not a domestic supplier,” Xiaofeng Peng, LDK Solar’s chairman and CEO, said.

•Chinese wind and solar power products maker Baoding Tianwei Baobian Electric Co Ltd said it has launched a rights issue at a price of US$1.826 apiece. The offering is at a ratio of 1.8 new shares for every 10 held.

The company, which is also engaged in the manufacturing of transformers and other electrical equipment, is part of renewable energy products maker Baoding Tianwei Group. The rights offering kicked off on April 7 and lasted till April 13.

Baoding Tianwei Baobian had 1.17 billion shares on April 6, when the share closed at US$3.599 on the Shanghai Stock Exchange. Baoding Tianwei Baobian Electric did not provide further details on the offering.

•Australian diversified renewable energy company CBD Energy is to finalize its joint venture agreement with Chinese Baoding Tianwei Baobian Electric and China Datang Corp Renewable Power today.

In May 2010, the three companies began discussions on the formation of a joint company – AusChina Energy Development Ltd – to carry out green energy projects in China and Australia. The entity will seek to build US$6.3 billion worth of renewable energy projects in eight years and to gain a significant share of the Australian energy market, CBD said.

CBD Energy, a provider of wind, solar and energy storage services, will reveal further details on the joint venture when the final documents have been signed.

•Chinese solar wafer maker LDK Solar on April 11 said it has completed the offering of additional US$76.5 million senior notes due 2014 in a private placement. The company expects to get net proceeds of US$76.2 million from the sale and plans to use the proceeds for general corporate needs.

The notes are settled in U.S. dollars and bear a coupon of 10 percent. Morgan Stanley & Co International was the sole placement agent for the transaction.

The notes were issued as additional securities to the previously issued US$183 million 10 percent notes due 2014.

•Chinese coal machinery equipment provider Linzhou Heavy Machinery Group plans to invest US$22.9 million in a manufacturing facility of roof-mounted photovoltaic modules.

The company said on April 11 that the factory’s total installed capacity is estimated to reach 10 megawatts. The project is expected to be co-financed with a total aid of US$18.01 million, including US$15.42 million in central government aid and US$2.52 million province level grant.

Linzhou Heavy Machinery Group is currently planning to spend US$6.87 million on the first phase of construction with total installed capacity of 3 megawatts.

•German photovoltaic systems provider IBC Solar inaugurated last Monday its subsidiary in Beijing. With the launch of its new subsidiary, IBC Solar is bringing its complete product and service portfolio to the Chinese market, the company said.

“By expanding photovoltaics in China, the huge energy demand of the growing Chinese economy can be satisfied in the future in a safe and environmentally friendly way,” IBC Solar’s founder and CEO, Udo Moehrstedt, said.

IBC Solar has been acting since March 2010 as advisor to China BIPV Committee in building-integrated photovoltaics.

•Shanghai Chaori Solar Energy Science & Technology Co Ltd announced on April 13 it expects to report a 787 percent year-on-year increase in its first-quarter net profit. The solar cell component maker cited as a reason growing overseas sales and the euro’s appreciation.

Wind power, hydro power
•Shanghai Electric Group Company Limited has nabbed a 250-megawatt wind turbine supply order from Indian KSK Energy, news agency Xinhua wrote, quoting an unnamed Shanghai Electric executive. Shanghai Electric will ship a total of 125 wind turbines of 2 megawatts each.

Shanghai Electric established its wind power equipment manufacturing arm in 2006. The diversified power equipment maker expects that India will become one of its biggest overseas markets.

•Chinese power utility GD Power Development Co Ltd last Monday said it would sell as much as US$841.2 million in six-year convertible notes.

The company plans to use the proceeds to finance the development of five hydropower projects and 11 wind power projects with a total cost of US$855 million. The bonds will bear a coupon of up to 3 percent.

•Oil major PetroChina, a unit of state-owned China National Petroleum Corp, said last Monday that its first 1.5 megawatt wind turbine has been recently connected to the local power grid in northeast China. The wind turbine was rolled out by equipment manufacturer Liaohe Petroleum Equipment Company.

PetroChina has been focusing on the development of wind turbines since 2007. So far, the company has injected US$ 76.5 million in the manufacturing project, which has taken three years to complete.

The company is anticipated to make 1,000 sets of wind turbines annually by 2012, while generating US$1.53 billion in revenues.

•China Power New Energy Development said on April 13 it plans to launch a Chinese yuan-denominated bond offering in Hong Kong.

The company did not provide further details on the plan, only saying that the bonds will be guaranteed by some of its subsidiaries. No binding agreement on the placement has been reached yet.

China Power New Energy operates various power generation facilities, including wind, waste-to-energy, natural gas and hydropower. At the end of 2010, it had an installed capacity of 1,617.55 megawatts.

•Chinese energy utility GD Power Development Co Ltd said on April 13 that it has received the go-ahead from the Jilin Provincial Development and Reform Commission for a 48-megawatt wind power project.

For the past three years, GD Power has got the authorities’ approval for 20 wind farm projects. All of them are now under construction.

The company’s total capacity at the end of 2010 stood at 28.79 gigawatts, including installed wind and hydropower capacity of 7.74 gigawatts.

•Spanish wind energy company Gamesa said on April 13 it has signed agreements with three Chinese firms for implementing renewable energy projects.

The Spanish company inked several memoranda of understanding with China Longyuan Electric Power Group, China Resources Power and Datang Renewable Power for the supply of 900 megawatts of wind turbines. Those memoranda could become contracts over the next months, Gamesa added.

Apart from that, Longyuan chose Gamesa as partner for developing wind energy projects outside China. Moreover, the two firms made commitments to jointly roll out 200 megawatts of wind facilities until 2015.

•Greece’s power utility Public Power Corporation said on April 13 it has sealed a strategic agreement with Chinese wind turbine major Sinovel Wind Group to jointly implement wind power projects.

The companies will partner in developing wind farms and building a wind generator factory in Greece.

As part of the strategic partnership, the two plan to start with a 200-megawatt to 300-megawatt wind power project in Greece.

•Danish wind-turbine major Vestas Wind Systems A/S announced on April 14 it had received an order for 50 megawatts of wind turbines from China Datang Corp Renewable Power.

The 25 units of the company’s V90-2.0 megawatt wind turbine will be installed near the city of Hulunbeier in northeastern Inner Mongolia. The construction of the facilities has to be completed quickly as the climate in the region is really tough and installation is only possible between early May and late September.

The contract envisages delivery, installation and commissioning of the wind turbines, as well as a five-year after-sale service. The units will be delivered in the second quarter of this year.

Datang and Vestas have been doing business for some six years. The companies have signed contracts for over 800 megawatts of wind turbines.

This industry report brief is courtesy of AII Data Processing.