"Advance" And "Retreat" Of "Gcls"

A-share governance theory

After the accelerated expansion in recent years, Zhu Gongshan, known as the "king of private power", has been under increasing pressure to cope with the era examination question of great cycle adjustment. In 2019, GCL added and subtracted with one hand, adjusted structure and reduced debt, which became the most realistic portrayal of the "GCL system" at present.

On April 6, Longji (601012. SH), a leading photovoltaic company, announced that it would carry out hydrogen energy industrial layout in the next step.

On the same day, according to Ali's auction information, the auction of "Zhejiang Changxing haneng thin film solar energy Co., Ltd.'s real estate, ancillary facilities and other overall assets" under the "hanergy Department" will be auctioned on April 27, and the public information shows that it is "bankruptcy liquidation"

Photovoltaic, in the A-share market, there is no lack of stories.

In this issue, the "A-share governance theory" series of the 21st Century Capital Research Institute focuses on the subject "GCL", and its connection direction is also concerned.

"As the auditors of the company need more time to complete the annual performance review procedures, they can not release their 2020 annual performance on or before March 31, 2021." on April 1, poly GCL energy (03800. HK) announced that it would suspend trading on the same day until the 2020 annual performance was released.

Poly GCL energy expects a net loss of no less than 5.8 billion yuan in 2020, the largest loss in the company's history, and a net profit of about 110 million yuan in 2019.

In the capital market, poly GCL energy is often regarded as the core listed company of GCLs.

GCL new energy (00451. HK), another Hong Kong stock company dominated by photovoltaic power stations, disclosed its preliminary performance announcement on April 1, with a loss of 1.368 billion yuan in 2020.

This does not seem to pull GCL out of the spotlight.

Faced with the decline of subsidies under the "531" new deal, the liquidity of GCL system, which is the layout of photovoltaic power stations, has been under pressure. Xinhua News Agency

"Hot spots" under pressure

The 21st Century Capital Research Institute has found that in the capital layout of "GCL system" (a group of listed companies formed around GCL (Group) Holding Co., Ltd.), poly GCL energy produces silicon materials, GCL integration is responsible for module production, and GCL new energy is responsible for the construction, operation and management of photovoltaic power stations. The three important links of photovoltaic layout are closely linked.

"GCLs" was built by Zhu Gongshan, the richest man in Yancheng, Jiangsu Province. It has two A-shares, two Hong Kong shares and one new third board company.

In the photovoltaic field, poly GCL energy (03800. HK), GCL new energy (00451. HK) and GCL integration (002506. SZ) have completed one-stop layout from the upstream silicon, silicon materials and silicon wafer manufacturing to the midstream photovoltaic cells, module and system integration, and then to the downstream photovoltaic power station.

The non photovoltaic assets of "GCLs" are reflected through GCL energy (002015. SZ). Its main business includes gas turbine cogeneration, wind power generation, garbage power generation, biomass power generation, coal-fired cogeneration, etc.

After the accelerated expansion in recent years, Zhu Gongshan, known as the "king of private power", has been under increasing pressure to cope with the era examination question of great cycle adjustment.

"The examination questions in the era of high-quality development are actually four operations of addition, subtraction, multiplication and division, and the process of solving them is just an excellent opportunity to force an enterprise to reinvent itself," Zhu Gongshan said in his new year's speech in 2020. In 2019, GCL did addition, subtraction, structural adjustment and debt reduction, which became the most authentic portrayal of "GCL system".

In addition, GCL smart energy, the non photovoltaic asset of GCL system, was reorganized and placed in * ST Xiake (namely GCL energy technology) in June 2019. Its main business includes gas turbine cogeneration, wind power generation, garbage power generation, biomass power generation, coal-fired cogeneration, etc., and has become one of the leading operators and service providers of non-public clean energy power generation and cogeneration in China.

Tongxin Optoelectronics (835088. OC), which is listed on the new third board, as the representative of LED semiconductor new material industry, is another development direction of "GCL system". According to the official website of GCL group, it has been built into a number of sectors including power, photovoltaic, oil and gas, finance and semiconductor. So far, a private new energy group stands in front of us.

In 2019, the operating revenue of GCL group is 101.4 billion yuan. At present, GCL group ranks 213 in China's top 500 enterprises and 56th in China's top 500 private enterprises.

However, "GCL" a number of companies under pressure.

In 2020, poly GCL energy, with a net loss of no less than 5.8 billion yuan, is mainly due to the sale of 31.5% of the equity of Xinjiang GCL New Energy Materials Technology Co., Ltd., and the recognition of the sale income of about 4.4 billion yuan. However, there is no Xinjiang sales income in 2020 and the provision for asset impairment. Part of the expected increase in net loss was offset by exchange gains on US dollar denominated debt as a result of the depreciation of the US dollar against the renminbi.

GCL new energy, another Hong Kong stock platform, is expected to lose 1.368 billion yuan in 2020.

GCL new energy, which has 213 photovoltaic power stations in the world, has sold a number of photovoltaic power stations in the past year. "Due to the sale, the total installed capacity of the company's stock photovoltaic power stations has decreased from about 5.7 GW on December 31, 2019 to about 5.0 GW on December 31, 2020".

According to GCL new energy, "based on the impairment assessment of the existing photovoltaic power plants, it is expected that a further non cash impairment loss of no less than 500 million yuan will be recorded in the year. In addition, the recoverability of several long-term outstanding receivables has been assessed and a one-time non cash impairment loss of no less than 300 million yuan is expected to be recognized for such receivables.".

The performance of GCL integration, which belongs to the photovoltaic sector, is not optimistic.

Gclsi is expected to have a substantial loss of 1.52 billion yuan to 2.519 billion yuan in 2020, with a year-on-year decrease of 4633.76% to 2835.47%.

Gclsi said that (in 2020), on the one hand, the company's component production costs rose, the component terminal sales price increase was less than the price increase of raw materials, and the gross profit rate of components decreased significantly. Therefore, gclsi took the initiative to carry out strategic adjustment, optimize high gross profit orders and give up low-cost orders, which affected component sales; on the other hand, its energy engineering EPC business affected the start-up and grid connection volume due to the epidemic situation, as well as the business In addition, gclsi carefully evaluated the M2 and G1 production capacity, carried out asset impairment for the capacity of batteries and components that did not meet the technical upgrading conditions according to the accounting policies, and made provision for asset impairment of some power station assets. These factors together led to the decrease of annual revenue and profit.

In contrast, GCL energy technology, which is not a photovoltaic module, is unique.

In 2020, despite the large amount of provision for asset impairment, GCL energy technology expects its net profit to reach 776 million yuan to 888 million yuan, an increase of more than 40.15%.

Heavy debt

Behind the pressure of performance, the market is more concerned about the tight capital chain of "GCL".

On May 31, 2018, the three ministries and commissions jointly issued the notice on issues related to photovoltaic power generation in 2018 (fgy [2018] No. 823), that is, after the "531 New Deal", the photovoltaic industry ushered in a major adjustment in the cycle, and began to shift from subsidy driven to parity driven, and the industry moved forward in the shock.

Faced with the decline of subsidies under the "531" new deal, the liquidity of GCL system, which is the layout of photovoltaic power stations, has been under pressure.

"In fact, GCL still made a lot of money before, but it always focused on polycrystalline silicon technology. Now 90% of the industry is monocrystalline silicon technology. Before GCL, the plate was too big and was dragged down," a photovoltaic practitioner told the 21st Century Capital Research Institute. "The core technology direction of the photovoltaic industry is very critical. Otherwise, if we do one more link, we will not give the enterprise bonus points or even invest After entering, it has become a bottleneck restricting the growth of enterprises. "

According to poly GCL energy, as of the end of 2019, its current liabilities exceeded its current assets by about 21.906 billion yuan. In addition, the total borrowings of the company and its subsidiaries (including bank and other loans, lease liabilities, notes payable and bonds and loans from affiliated companies) were about 55.373 billion yuan. In the next 12 months, the company and its subsidiaries will have a total loan balance of about 28.674 billion yuan due.

GCL new energy also bears 10 billion debts: according to the preliminary performance announcement, by the end of 2020, the total liabilities of GCL new energy will be 36.499 billion yuan, with a debt ratio of about 81.0%, and the capital pressure has been alleviated.

In 2018, the total debt of GCL new energy was 51.478 billion yuan. By 2019, this figure dropped to 45.540 billion yuan, with a debt ratio of about 81.7%, a year-on-year decrease of 2 percentage points.

Previously, in an interview with the media, GCL new energy said it expected to reduce the asset liability ratio to about 70% in 2021.

In the latest performance announcement, Zhu Yufeng, chairman of GCL new energy, also said frankly, "in the past year, we have felt lost and confused, but we have not retreated. In spite of many difficulties, GCL new energy has made a steady step forward in the transformation of scale operation to asset management. As of December 31, 2020, the company announced that the total installed capacity of photovoltaic power station was close to 2 GW, the cash recoverable was about 6.8 billion yuan, and the debt scale was effectively reduced by about 9.5 billion yuan. In addition, the company completed the net allocation of about HK $895 million at the beginning of 2021, the company's current capital situation will be significantly improved. "

GCL integration, another A-share platform, was doubted by the market in 2020 because of the stock price flash collapse, and the shareholders' high pledge burst positions.

On March 26, gclsi disclosed that Yingkou Qiyin Investment Management Co., Ltd., acting in concert with the controlling shareholder, released the pledge of 15.01 million shares (accounting for 1.61%), and then pledged another 15.01 million shares.

As of the disclosure date of the announcement, GCL Group Co., Ltd., the controlling shareholder of GCL integration, has pledged about 466 million shares, with a pledge rate of 100%. Yingkou Qiyin and Huaxin group, acting in concert, have pledged 858 million shares and 520 million shares respectively, with the pledge rate of 92.05% and 100% respectively.

Behind the high pledge is the above shareholders' desire for funds.

As of the third quarter report of 2020, gclsi has a total debt of 8.939 billion yuan, with an asset liability ratio of 68.1%.

In fact, even GCL energy, which has good profitability, is also in short supply.

At the end of the third quarter of 2020, the book monetary capital of GCL Energy Technology Co., Ltd. was 3.779 billion yuan, and the total liabilities were 20.04 billion yuan, including 2.69 billion yuan of short-term loans, 1.435 billion yuan of non current liabilities due within one year, and the total current liabilities of 8.756 billion yuan.

In addition, wind data shows that by the end of 2019, the total liabilities of poly GCL energy were 73.716 billion yuan, GCL new energy was 44.447 billion yuan, GCL integration was 11.6 billion yuan, and GCL energy technology was 16.397 billion yuan.

one step back today for two steps forward tomorrow?

Faced with the rising debt of GCLs, Zhu Gongshan chose subtraction.

In 2019, China's photovoltaic industry will usher in the first year of "non subsidy." optimizing the asset liability structure and reducing the debt ratio has become the key words of poly GCL energy. Similar expressions such as structural adjustment, debt reduction, cash flow guarantee and refined operation also appear in GCL new energy's 2019 annual report.

"GCLs" began to sell assets in batches and set up investment funds with its partners.

On June 6, 2018, poly GCL Energy announced that it planned to sell 51% equity of Jiangsu Zhongneng Silicon Industry Development Co., Ltd. (hereinafter referred to as "Jiangsu Zhongneng") to a + H listed company Shanghai Electric (601727. SH / 02727. HK) for no more than 12.7 billion yuan.

However, two months later, "due to the large scale and complexity of the transaction, it is difficult for the parties to reach a complete agreement on the relevant terms and schemes of the potential sale within a short period of time".

This did not affect the subsequent series of asset sale plans of GCLs.

In 2019, poly GCL energy successfully completed the transfer of 31.5% equity of GCL in Xinjiang, with a one-time sales income of 4.4 billion and a net cash inflow of 1.33 billion.

In addition, poly GCL energy has also introduced high-quality capital to further optimize the asset structure through "jointly financing and establishing investment fund with Leshan government", "jointly financing and establishing investment fund with Xuzhou Industrial Development guidance fund Co., Ltd. and Xuzhou Economic and Technological Development Zone jinlonghu City Investment Co., Ltd.".

GCL new energy started to sell its photovoltaic power plants intensively.

The 21st Century Capital Research Institute found that from December 2018 to may 2019, GCL new energy successively sold shares of photovoltaic power station projects to China Three Gorges new energy Co., Ltd., CGN solar energy development Co., Ltd., Shanghai Rongyao new energy Co., Ltd., and Wuling Power Co., Ltd., a subsidiary of China Electric Power International Development Co., Ltd., respectively. The total cash recoverable from the above four transactions is about 26 A total of 9.43 billion yuan (after deducting transaction costs) was used to repay debts, reducing the debt scale of GCL new energy by about 9.43 billion yuan.

The latest news is that by the end of December 2020, the total installed capacity of photovoltaic power stations sold by GCL new energy is close to 2 GW, the recoverable cash is about 6.8 billion yuan, and the debt scale is reduced by about 9.5 billion yuan.

In order to go light, GCL new energy also sold its assets to China Huaneng Group, a state-owned enterprise.

On January 21, 2020, GCL New Energy announced that it had signed the first share purchase agreement with China Huaneng Group to sell seven photovoltaic power stations with a total installed capacity of about 294 MW. According to the first share purchase agreement, two of the company's indirect subsidiaries agreed to sell 60% of the sales shares to Huaneng Gongrong No.1 (Tianjin) equity investment fund partnership (limited partnership) and 40% of the sale shares to Huaneng Gongrong No.2 (Tianjin) equity investment fund partnership (limited partnership) for about 850 million yuan. The net cash proceeds (net of estimated taxes and transaction costs) (including consideration, total outstanding balance and dividends payable) are estimated to be about $1.08 billion.

GCL new energy said that it will further explore other cooperation opportunities with China Huaneng Group, including but not limited to cooperation opportunities between GCL new energy and existing photovoltaic power stations in China and new photovoltaic power stations to be developed.

On March 31, the two Hong Kong stock companies of "GCLs" jointly put forward an asset sale plan.

According to the announcement, poly GCL energy, Henan GCL new energy and Suzhou GCL new energy (as the seller) intend to sell all the shares in Kaifeng Huaxin, Sanmenxia Xieli, Queshan Zhuri and Shangshui GCL respectively to Three Gorges Asset Management Co., Ltd. (as the seller), and 50% equity in Nanzhao Xinli and Taiqian GCL respectively The company has six operating photovoltaic power stations in China, with a total grid connected capacity of about 321mw. The net cash income from the transaction is estimated to be about 928 million yuan, and the relevant funds will be used to repay the debt of GCL new energy.

Direction conjecture

At the same time of subtraction, GCLs is also doing addition with one hand, and its attack direction includes granular silicon, semiconductor and electric vehicle power exchange business.

Poly GCL energy, which is mainly composed of polycrystalline silicon chips, single crystal ingots and single crystal silicon chips, adheres to the development strategy driven by single crystal and polycrystalline "dual engine".

On the one hand, poly GCL Energy said that on the one hand, all polysilicon projects in Xinjiang will reach production capacity within 2019, releasing 48000 tons of production capacity. The project is a super large-scale clean production technology of polycrystalline silicon independently developed by GCL, which further reduces the comprehensive cost of polycrystalline silicon production. At that time, the project will also become a stable profit source of poly GCL. On the other hand, the company's "ingot single crystal technology has made a leap forward breakthrough, and the technical route of ingot technology for manufacturing single crystal products has officially entered into large-scale mass production Stage ".

In addition, poly GCL energy is accelerating the mass production of granular silicon.

On September 8, 2020, the largest single granular silicon project in the world, Jiangsu Zhongneng project of poly GCL energy, with a planned capacity of 100000 tons and the first phase of 54000 tons of granular silicon project, officially started to expand.

On February 1 this year, poly GCL energy further disclosed that the new production capacity of FBR granular silicon of Jiangsu Zhongneng will be officially put into production on February 3, 2021, and the annual effective capacity will be increased from 6000 tons to 10000 tons, officially entering the 10000 tons scale.

Poly GCL Energy said that compared with the traditional process, the original silane fluidized bed process for batch production of granular silicon not only has shorter production process and fewer post-treatment processes, but also has spherical shape and good fluidity, which can better meet the requirements of re feeding size.

However, some people in the industry told the 21st century capital research institute that "the high hydrogen content of granular silicon will produce the situation commonly known as hydrogen jump, which will have an impact on the quality of pulling rod; in addition, the large amount of particulate silicon dust and high carbon content will affect the purity of silicon rod". At the same time, it believes that "with the progress of technology, it is still optimistic about the prospect of granular silicon, such as using granular silicon in rod pulling link to save power."

On February 28, poly GCL energy further demonstrated its determination in layout through two announcements on expanding the production of granular silicon projects.

According to the announcement, Leshan Sumin, a subsidiary of poly GCL energy, has successfully introduced strategic investors as the main body of Sichuan Leshan granular silicon project (phase I 60000 tons).

In addition, Jiangsu Zhongneng signed a strategic cooperation framework agreement with Shanghai CNC (603185. SH), a listed A-share company, to jointly invest in the construction of 300000 tons of granular silicon project in Inner Mongolia, with a total investment of 18 billion yuan. The two sides intend to set up a joint venture, with Jiangsu Zhongneng holding 65% and shangcnc holding 35%.

Gclsi, another platform of GCLs, is accelerating the strategic transformation of "photovoltaic + semiconductor".

Gclsi mentioned that "in 2020, great changes will take place in the photovoltaic industry, large-size modules will become the mainstream demand of the market, and the production capacity of large-scale modules will be switched very quickly, and the new capacity will be rapidly switched to G12 (210) and M10 (182)". With the construction of 60GW large-scale module base in Hefei and the investment and construction of 10 GW high-efficiency large-scale battery base in Leshan, the company's large-size module will be gradually improved High efficiency module battery capacity.

In addition, at the end of January 2021, gclsi's fixed increase of 2.5 billion yuan was officially implemented, and the net amount raised will be used for the large-scale regenerative wafer semiconductor project, the Funing gclsi 2.5gw laminated tile module project and supplementary working capital, so as to promote the development of the company's secondary industry.

Instead, GCL energy technology, which is not in the photovoltaic sector, has made a big deposit in the electric vehicle power exchange business.

Just in the middle of March, after announcing the development plan of electric vehicle replacement business, on March 31, GCL energy technology further disclosed the progress of the strategic cooperation agreement with CICC capital. The two sides intend to jointly initiate the establishment of an industry fund with the theme of "carbon neutrality", through equity investment in high-quality projects in the upstream and downstream of the mobile energy industry chain and charging and swapping platform enterprises, And with the help of new energy vehicle travel platform to achieve the diversion to the charging and swapping platform, complete the construction of charging and swapping data platform, and build a new mobile energy industry ecology.

According to the previous agreement, the total scale of the fund does not exceed 10 billion yuan, of which GCL or its related parties / designated entities contribute about 51% of the total fund size; CICC or its related parties will be responsible for raising funds or contributing through its products / own funds, accounting for about 20% of the total scale of the fund, and the initial scale is about 4 billion yuan.

The two sides said that they would cooperate with the core businesses of integrated solutions for charging and exchanging power stations, operation and energy services of charging and exchanging power stations, and echelon utilization of batteries.

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