As the former king of new shares in Hong Kong stocks, Shuifa Singyes Energy (0750.HK, formerly known as "Singyes Solar"), of which stock price once rose by more than 13 times in five years after listing, has gradually lost attention from investors since its debt defaulted.
Mr. Liu Hongwei, the vice chairman of the board of directors of the company, said in an interview with Securities Times that the number of participants in the annual results conference was close to 200 when the company was at its best, but now only few participants join. The main reason of the downturn in business was that the management failed to adjust its business strategy timely when the domestic photovoltaic industry environment was changing. In November last year, after the company's control was taken by Shuifa Group, relying on the resource advantages of the controlling shareholder, it completed debt restructuring and began to promote and plan for its clean energy business with great effort. At present, its business has basically resumed normal and it returned to profitability in the first half of this year.
Shuifa Singyes Energy started the natural gas sales business in the first half of this year, and realized revenue of over 100 million yuan in the second quarter. The company plans to expand the clean energy sector, build the largest LNG Pier-Yangkou Port in China, and accelerate the development of integrated oil and gas business.
The State-owned Enterprise Holding Platform Has Greatly Increased Its Performance
Shuifa Singyes Energy ("Singyes Solar") is one of the pioneers in the photovoltaic industry in China, and its performance was once far surpassed that of today's industry giant Longi. It built the largest single amorphous silicon BIPV project at the time, and has been leading the curtain wall and green building markets in China until now.
Review of the company's "roller coaster" performance in the past few years: During the period from 2010 to 2014, the company's business was booming, the net profit increased year by year, from about 200 million yuan in 2010 to 580 million yuan in 2014, with an average annual growth rate of over 30%. From 2014 to 2018, the company's performance fluctuated greatly.
In 2018, a new "5．31" policy for the photovoltaic industry was introduced. The reduction of subsidies and the limitation of industry scale caused a large number of enterprises to suffer heavy losses, and Singyes Solar was not spared. In that year, "Singyes Solar" failed to publish its annual results, defaulted on its debt, and stock price plunged in after its resumption of trading, and was eventually taken over by the "White Knight", Shuifa Group.
The impact of debt default continued until 2019, and the company suffered losses for two consecutive years. After being acquired by Shuifa Group, "Singyes Solar" signed a debt settlement agreement with creditors, repurchased US dollar bonds, reduced asset-liability ratio, increased credit line, completed debt restructuring, and its business returned to normal. It was renamed as "Shuifa Singyes Energy".
Mr. Liu Hongwei said that with the support of the controlling shareholder, Shuifa Group, Shuifa Singyes Energy actively develops its clean energy business, integrates resources in developing photovoltaic and wind energy business, and expands the asset scale of clean energy through simultaneous project development and mergers and acquisitions.
In the first half of this year, Shuifa Singyes Energy recorded an operating income of 1.98 billion yuan, a year-on-year increase of 72.39%; and it turned losses into profits, the net profit was 218 million yuan.
Build Yangkou Port to Expand Clean Energy Business
Shuifa Singyes Energy is engaged in designing, manufacturing and installing curtain walls, green buildings and solar energy projects. According to the company's mid-year report, the company has opened up new businesses, including sales of liquefied natural gas, gasoline and diesel oil. In the first half of the year, the revenue of this business was 156.8 million yuan, accounting for about 7.9% of the company's total in the same period.
After that, Shuifa Singyes Energy expanded its natural gas business. On 16 October 2020, Shuifa Singyes Energy signed an investment cooperation agreement with Huagang Group (Shanghai) Petroleum and Natural Gas Co., Ltd. ("Shanghai Huagang") and Jiangsu Yangkou Port Energy Co., Ltd. ("Yangkou Port Energy") in Yangkou Port, Rudong, Jiangsu. The three parties will cooperate closely in natural gas and oil chemicals trade, energy project investment, natural gas industry investment and other fields to build the flagship enterprise of oil and gas trade and investment of Shuifa Singyes Energy Group.
In recent years, Shuifa Singyes Energy has actively invested in the natural gas industry, and has reserved a number of LNG receiving piers and storage tanks, container wharfs and yards, natural gas pipelines, city gas and other projects. Shanghai Huagang and Yangkou Port Energy will provide support in the investment, operation and management of infrastructure such as LNG receiving pier, peak shaving reserve, city gas and oil and gas filling station. At the same time, Shuifa Singyes Energy will carry out comprehensive energy technology research in Yangkou Port by virtue of its advantages in comprehensive utilization of distributed energy, and develop energy complexes such as oil, gas, electricity and hydrogen integrated stations.
Mr. Wang Dongwei, the executive vice president of Shuifa Singyes Energy, pointed out that the company will jointly invest in the project with the controlling shareholder, Shuifa Group, relying on the capital and industrial advantages of Shuifa Group, the company mainly integrates resources and projects. It is estimated that the project will be constructed in three phases, of which the investment in the first phase is about 2 billion yuan.
It is understood that Jiangsu Rudong Yangkou Port is a provincial-level development zone in Jiangsu and a national first-class open port. As the nearest seaport over 100,000 tons from Shanghai and an important node for coastal development in Jiangsu, it is an important channel for importing LNG in China.
Mr. Liu Hongwei said that this cooperation is of strategic significance to the development of the company. The company will keep up with the development opportunities of Yangkou Port, take advantage of its policy advantages, location advantages and industrial agglomeration advantages, actively trade natural gas and oil chemicals, and participate in investment of the related energy projects, and increase the proportion of oil and gas business in the company's energy sector, so that the business composition of the company's clean energy sector will be adjusted to be based on wind and solar energy, with diversified clean energy, forming a comprehensive clean energy business.
Shuifa Singyes Energy has formulated a medium and long-term plan. On the basis of existing solar, wind and energy storage businesses, it will strive to develop natural gas, heat and energy-saving services, and actively plan for its hydrogen energy business, in order to build a clean energy industrial cluster with multiple complementary energies.
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