Recent media reports, the concept of wind power in China involving listed companies, especially wind power equipment manufacturer in 2011 for reporting the results are not ideal.
It is understood, Shenzhen and Shanghai has 40 companies involved in the concept of wind power companies, the first half of 2011, total net profit of 8.02 billion yuan, down 8.7%. Which, as wind power equipment manufacturer, Thai wins wind energy, Sinovel and Goldwind’s net profit fell 61.5%, 48.3% and 45.0%.
In addition to net income showed a dramatic decline in the collective, the wind power sector listed company’s cash flow is also worrisome. According to statistics, the 40 listed companies first half of 2011, net cash flow from operating activities -106 million, compared with $ 7.1 billion in same period in 2010 significantly reduced 177 million. Among them, jixin Technology, Shanghai Electric, Sinovel, Erik wind energy, wind energy, nearly 20 wins Thai family tradition the concept of corporate power net cash flows from operating activities fell year on year rate of more than 100%.
Two sets of data mean that China’s wind power industry began to slow, even reverse it?
Behind the decline in performance
Why wind power companies will be such a big decline in performance? In this regard, China Securities analyst Bin Zhang Financial News that the wind generators caused the first half of 2011 mainly due to decline in corporate performance fan overcapacity, trade policy restrictions and increased financing costs .
Bin Zhang explained that, in the “high-speed, high-profit” driven by the slogan of the past five years China’s wind power industry added more than 80 machine manufacturer, is expected to total production capacity will reach 2011 fans 29GW (gigawatts), far far exceeds the current 15GW to 18GW of actual demand. This makes the price war between the wind power business, which led to gradually lower the price of wind power, wind power reduces the profits of enterprises.
Second, since February 2011 small wind generators accidents, the government introduced a series of policies, not only tightened the approval of new wind power project, to suspend approval of the grid, also proposed a more rigorous and network technology, testing requirements to enter the wind power industry to improve the technical threshold. Objective of these measures in the short term wind power to market and the enterprise itself has brought some pressure.
In addition, the central bank for six consecutive times since 2011, raising the deposit reserve ratio, and our wind power business asset-liability ratio is relatively high. Bin Zhang believes that this measure has led to the wind power business interest and financing costs increased substantially, and further reduce its profit margins.
Mature in the adjustment
The face of China’s wind power business suffered during the first half of 2011, “Waterloo”, analysts have said that although the development of suspension, but this situation is precisely that domestic wind power industry is the transition from the growth to maturity, began to return to a rational development of the industry .
“Any new industry will follow the” mature bud growth recession, “the law of development, the wind power industry is also bound to comply with this law of development.” Investment adviser in the new energy industry researcher Xiao letter on the “Science Times “Reporters said.
Xiao letter believes that the current wind power companies have emerged, both good and bad, mainly through the competitive price and output to expand the market, these phenomena show that the domestic wind power industry is in a transition from the growth stage to maturity stage.
Thus, with the market development, China’s wind power business through the integration of the next step is bound to seek further development. Wind power enterprise’s core competitiveness will increasingly depend on quality, technology, branding and marketing.
Bin Zhang said that as new industries, wind power industry is to get rid of subsidies and state support of crutches, will be more reliance on market regulation forward. Although the wind power industry overcapacity, increased competition, lower prices, etc. will remain a longer period of time, but the whole industry will continue to adjustment toward a more rational, standardized, sustainable direction.