GOLDENSOLAR (01121): Partnering with Longi and GCL to establish a joint venture company, deeply solidifying HBC battery technology advantages.

In the face of the intensification of the internal competition in the photovoltaic industry, it is obviously the best choice for current enterprises to achieve a breakthrough through strong alliances for mutual benefit and win-win outcomes. On the evening of September 19, GOLDENSOLAR (01121) announced that its indirect wholly-owned subsidiary, Golden Yang (Quanzhou), has entered into a joint venture agreement with Fujian Jungen Electric Power Co., Ltd. (referred to as "Jungen") and Longji to establish a joint venture company, Golden Long (Xi'an) New Energy Technology Co., Ltd., to produce HBC (back contact crystalline silicon heterojunction) CECEP Solar Energy cells. Amidst the industry's deepening competition, with PERC capacity facing a harsh asset clearance, GOLDENSOLAR's upgrade of PERC capacity to HBC through patented technology and a strong alliance with Jungen and Longji is evidently a model of empowering the photovoltaic industry with new productive forces for sustainable development. Therefore, from this announcement, it is evident that GOLDENSOLAR, which has a certain first-mover advantage in HBC photovoltaic cells, is gaining more and more recognition and trust in the market. Innovating in technology to strengthen core competitive advantages As is well known, the history of photovoltaic cell technology iteration is a history of innovation where companies must continuously upgrade and innovate in order to have a strong voice in the industry transition between old and new technologies. In this context, the joint venture company established by GOLDENSOLAR with Longji and Jungen can be seen as a strategic move. According to GOLDENSOLAR's announcement, the joint venture company will upgrade Longji's four PERC production lines in Xi'an Aerospace Industry Base to high-efficiency HBC production lines. This indicates that Longji will start technological upgrades for its p-type cell capacity. According to the agreement, after meeting the relevant efficiency and quality standards in various aspects, the joint venture company will sell most of the HBC CECEP Solar Energy cells produced to Longji or its affiliated companies, which will further encapsulate them into components for sale. It is reported that this is Longji's first public announcement of involvement in HBC technology research and production. CURRENTLY, Longi Green Energy Technology's main products are based on HPBC technology. In previous semi-annual performance meetings, Longji stated that while most companies in the industry choose TOPCon technology for next-generation cell technology, Longi Green Energy Technology chose a differentiated BC technology. From the perspective of investment returns, with the same area, HPBC 2.0 products generate 6% more electricity than TOPCon, which translates to a 15%-20% increase in pre-tax profits. Therefore, GOLDENSOLAR's ability to assist Longji in upgrading its HBC production line is due to the company's strong HBC technological advantage. Furthermore, GOLDENSOLAR has applied for multiple patents covering various aspects of HBC CECEP Solar Energy cell and component structures, production processes, and equipment, including European and American patents, and has successfully obtained dozens of patent grants. In addition, the company is the first in the world to mass-produce high-efficiency second-generation hybrid HBC CECEP Solar Energy cells with a conversion efficiency exceeding 27%, and the first in the world to mass-produce high-efficiency flexible HBC CECEP Solar Energy components for consumer products such as residential and recreational vehicles. Overall, GOLDENSOLAR's support for Longji's upgrade to HBC cell production line not only demonstrates the company's increasing maturity in HBC technology but also greatly accelerates the photovoltaic industry's transition to the BC era. Strengthening product quality image for potential to become a main supplier of BC cells Looking at the growth trajectory of GOLDENSOLAR, the joint venture company established with Longji and Jungen to produce HBC CECEP Solar Energy cells not only highlights the company's strong technical advantage in HBC cells but also, from a deeper perspective, signifies that Golden Yang may become a major supplier of BC cells in the future. From focusing on manufacturing and selling footwear products at the time of its initial public offering in 2011 to now concentrating on research and development of single-cast heterojunction (HJT) CECEP Solar Energy cells and components, HBC CECEP Solar Energy cells, HBC flexible components, and rollable CECEP Solar Energy sunshades, over the past decade, Golden Yang has become a technology-driven technology innovation enterprise. There lies its strong growth path. Through GOLDENSOLAR's layout in HBC photovoltaic cells, with foresighted strategic positioning and efficient execution, the company is poised to have enough momentum to open up more growth space and become a main supplier of BC cells in the future. Firstly, starting with technological innovation as an entry point provides a technical basis for becoming a main supplier in the future. In September 2023, GOLDENSOLAR completed the world's first production line of heterojunction back-contact (HBC) photovoltaic cells, with a conversion efficiency of up to 27.42%, setting a new world record, and becoming the only production line in the world with a conversion efficiency exceeding 27%. This high level of technological efficiency makes their products highly competitive in the market, providing a technical basis for becoming a main supplier. Secondly, by focusing on upgrading production lines as a breakthrough, the company lays a first-mover advantage for the release of BC cell capacity in the future. LONGi Green Energy Technology predicts that nearly 20GW of HPBC2.0 capacity will be put into operation in the first quarter of next year. By the end of 2025, LONGi Green Energy TeBy the end of 2026, BC's production capacity is expected to reach 70 GW, and its domestic battery base is planning to fully transition to BC products. With the gradual release of upgrading demand for old production lines, this could be groundbreaking for GOLDENSOLAR. This not only means that it will be increasingly recognized in the market, but also that it will achieve a "replication effect" in the future. This will involve the transformation and updating of a large number of old production lines, gaining more growth momentum, and ultimately developing into a major supplier of BC batteries.In addition, the current period is also a time of rapid growth in the market demand for BC batteries, which also provides fertile soil for the growth of GOLDENSOLAR HBC battery technology. According to a report from the Head Leopard Research Institute, as global demand for renewable energy continues to increase, the photovoltaic industry is growing rapidly. As an efficient photovoltaic battery technology, the market demand for BC batteries is also expected to continue to grow. It is estimated that from 2024 to 2028, the market size of the BC battery industry will increase from 13.776 billion yuan to 143.138 billion yuan, with a compound annual growth rate of 79.54% during this period. "Advanced capacity never overflows." Every technological upgrade in the photovoltaic industry may conceal new leaders. Therefore, looking at the technical advantages and growth vitality of GOLDENSOLAR in HBC batteries, we may consider giving more confidence to GOLDENSOLAR and await its growing value to continue to be released.