JA Solar Holdings Co., Ltd. (JASO - Free Report) has announced the beginning of shipment of the solar modules to China Three Gorges New Energy Corporation ("CTGNE"). This contract has been signed between JA Solar and subsidiaries of CTGNE following a bidding procedure.
Per the agreement, the company will provide 40 megawatts (“MW”) of solar modules to CTGNE. The whole delivery is expected to be completed by the end of December 2012. CTGNE intends to utilize these modules for its utility-scale project at Ningxia province in China.
Globally, demand for renewable energy is growing primarily due to its clean nature, increasing prices of fossil-fuels, and growing awareness among the masses regarding its benefits. This fact induces the utility providers to shift their mode of power generating operations to wind, solar and water from coal, oil and natural gas.
JA Solar aims to take advantage of this opportunity and expand its overseas business footprint while foraying with international solar infrastructure companies and engineering, procurement and construction (“EPC”) players. The company has been supplying solar modules to customers across the globe. In September 2012, JA Solar commenced its 90 MW solar module shipments to China Power Investment Corporation ("CPI").
Another major Chinese solar player Suntech Power Holdings Company Ltd. is also busy in expanding its global footprint with a contract-win for the supply of 25 MW of polycrystalline solar panels to an Italian solar EPC company.
U.S. solar markets are gradually becoming less lucrative for the Chinese solar module manufacturers. The decision to impose anti-subsidy tariffs and anti-dumping duty by the U.S. Department of Commerce ("DOC"), will negatively impact the Chinese producers. The U.S. DOC rolled-out these tariffs to constrict the supply of the Chinese solar-products in the U.S. and encourage domestic players to tap the growing renewable U.S. market.
Amid this scenario, we believe these kinds of domestic contracts would provide JA Solar a ray of hope for its future growth prospects.
JA Solar Holdings Co., Ltd. currently has short-term Zacks #4 Rank (Sell rating).
Shanghai, China-based JA Solar Holdings Co., Ltd. is a leading manufacturer of high-performance solar power products that convert sunlight into electricity for residential, commercial, and utility-scale power generation. With a market capitalization of $156.70 million, the company has 11,639 full-time employees.