JinkoSolar Holding Co., Ltd. (JKS - Snapshot Report) has clinched a deal with Lightsource Renewable Energy to deliver 18.5 megawatt peak (MWp) of solar PV modules. Lightsource Renewable Energy which is UK's largest solar energy generator and asset operator will utilize these modules for a solar farm project located in the country.
Demand for solar products in the U.K. is fast ramping up. In August this year, Lightsource Renewable Energy entered into a contract with ReneSola Ltd. (SOL - Analyst Report) for the supply of 69.5 megawatt (MW) of modules for U.K. solar power plants. These modules will be utilized to power more than 23,000 consumers in the country. This will bring in more jobs, more business opportunities and more international investment.
Earlier, Chinese solar product manufacturers earned a major part of their revenues from the U.S. market. However, the U.S. government has implemented several clauses to control import volumes from China, while encouraging domestic players to promote their solar products in the U.S. market.
These regulations have made the solar market more competitive for Chinese solar product manufacturers operating in North America. The U.S. solar markets are thus becoming less lucrative for Chinese solar module manufacturers.
Therefore, Chinese companies are exploring new prospective markets while strengthening their presence in China. The companies are investing substantially to expand their footprint in different geographies while continuing with their research and development activities to upgrade technologies.
JinkoSolar is busy expanding its footprint in the Asian, African and European markets to offset the overall slowdown in U.S. orders. In fact, the company has successfully won numerous orders from these regions. On Sep 30, 2013, the company announced that it will supply one-third of the solar modules required by State Grid Corporation of China ("SGCC"), for a power project in Hebei Province.
Recently, Chinese solar stocks like Trina Solar Ltd (TSL - Snapshot Report) and Yingli Green Energy Holding Co. Ltd. (YGE - Snapshot Report) have seen their share prices rise as the Chinese government is now offering local solar manufacturers a 50% value-added tax rebate for sales taking place from Oct 2013 through Dec 2015.
JinkoSolar has also benefitted from the announcement. Driven by the announcement and steady flow of contracts for its highly efficient solar products, the company has experienced a 138.3% surge in prices over the last three months. JinkoSolar Holding Trina Solar and Yingli Green Energy Holding, all have a short-term Zacks Rank #2 (Buy).