Cross-border photovoltaic success model: Drinda Corporation

Cross-border PV is not all speculation concept, there are real winners. In the past, there were Tongwei shares and Eastern Hope, which came from feed giants across the border, and now there are automobile interior enterprises - Drinda Corporation.


Drinda  has become the first professional cell manufacturer in the industry to achieve large-scale production of N-type TOPCon cells, and is expected to lead the whole industry in the process of upgrading photovoltaic cells from P-type to N-type in this round.


The performance of Drinda is quite outstanding. In the first quarter of 2023, the company achieved operating income of 3.967 billion yuan, an increase of 94.84%; Net profit of 354 million yuan, an increase of 15 times year-on-year; The net profit of withholding was 344 million yuan, an increase of 14.93 times year-on-year.


The previously released 2022 annual report performance is also quite beautiful: During the reporting period, the company achieved a total operating income of 11.595 billion yuan, a year-on-year increase of 3 times; Net profit of 717 million yuan, up five times year-on-year; The net profit of withholding was 493 million yuan, an increase of 3.73 times year-on-year.


The outstanding performance of Drinda is not simply achieved through the comprehensive acquisition of the photovoltaic cell enterprise JTPV.


Throw away the baggage of history and pack lightly; Strategically choose TOPCon, adhere to specialization; The professional team plays a big role in management, and the execution force is far beyond that of peers, which is an important reason for the revitalization of the former cell leader JTPV.


Go light: professionalism promotes Drinda to set sail


At present, the main photovoltaic business of Drinda is operated by its wholly-owned subsidiary JTPV. Perhaps, Drinda, renamed "JTPV" or "Jietai Solar" is more appropriate.


The name Drinda may be a little strange to photovoltaic people, but when it comes to JTPV technology, it is estimated that many insiders know.


According to PV InfoLink statistics, in the global PV cell shipment ranking in 2018, Tongwei ranked first, and Aixu and JTPV tied for second. Unfortunately, in the past few years, affected by financing channels, route selection and other factors, the company's expansion pace slowed down, and its market share once declined.


At the end of 2020, JTPV began a drastic reform:


At the capital level, start the equity reform, plan the curve landing in the capital market;

At the business level, in December 2020, it was decided to completely stop the polycrystalline cell business with low gross profit margin, and at the same time, within the single crystal cell business, it will gradually switch to the large-size single crystal cell business with higher gross profit margin of 182mm and above, optimize the product structure, and focus on the layout of TOPCon.

The former aims to enter the capital market and plans to achieve leapfrog development in the new stage; The latter is a strategic adjustment to prepare for light competition in the future market.


The effects of these reforms are clear. In 2021, when the price of silicon materials rose, the gross profit of the photovoltaic industry chain was compressed, and specialized cell companies such as Aixu shares suffered losses or small profits, JTPV achieved positive growth; In 2022, the company benefited from the advantages of product structure and achieved high performance growth.


At present, the automotive interior business of Drinda has been sold, and now it is a pure photovoltaic enterprise with JTPV as the main body. Although the actual controller of the company is still the Yang family, and the financial investors Jiangxi State Assets and Supor also hold a lot of shares, the management of the company has been responsible for the management of JTPV.


The company recently held investor research and investor exchange activities, which were also responsible for JTPV, and Yang family members and other financial investors did not appear.


Professional things to professional people to do, investors will be more confident in the enterprise.


Zhang Manliang, the current general manager of Drinda, has 15 years of working experience in the photovoltaic industry, and has successively held many positions in technology, research and development, production management, and operation management, and has comprehensive technical and operation management experience in the photovoltaic industry. He has also served as the manager of JA Process Department, Deputy General manager of Hailun Photovoltaic Technology, Director of GCL Technology Process Research and Development, general manager of Oriental Sunrise Base, General manager of Jetai Technology and general manager of Shangrao Hongye New Energy.


In addition, the company's other core management personnel have rich industry experience, and have comprehensive research and development and management experience in the photovoltaic industry.


Efficiency win: TOPCon cell capacity runner-up, construction speed record


The photovoltaic industry is now in the transformation of P-type cells to N-type cells. Among the three different technical routes of N-type cells, TOPCon, HJT and IBC, TOPCon has gradually become the mainstream of the current N-type technology due to its excellent conversion efficiency and low investment and construction costs.

As we all know, Jinkosolar bet on TOPCon from the beginning, and it ended up being a big success. In the 2022 annual report of JinkoSolar, it is expected that by the end of 2023, the production capacity of silicon wafers, cells and modules will reach 75GW, 75GW and 90GW respectively, of which N-type cell production capacity will account for more than 70%. Jinko already has 24GW of TOPCon capacity, with 31GW under construction in 2023. There is no doubt that JinkoSolar is TOPCon's largest photovoltaic enterprise in terms of production capacity and shipments.

In fact, Drinda are also the beneficiaries of a bet on TOPCon. In terms of cell cells alone, JinkoSolar ranks first, and Drinda shares rank second.

On April 18 this year, Drinda announced: Huai 'an Phase I project completed and put into operation and Huai 'an Phase II project started. If the Huaian Phase II project is completed on schedule, by the end of 2023, the company's TOPCon production capacity will reach 44GW. This figure is higher than the 31GW expected in the 2022 annual report, which is closer to Jinko and more than many integrated enterprises.

The market performance of N-type cells this year has multiplied the advantages of Drinda TOPCon.

First, the N-type cell market demand is strong.

At the investor exchange meeting, Drinda said: since 2023, the market for N-type cell products has been in short supply, and the profit premium of N-type cells has been highlighted, and the company will "further meet the hot demand of the market".

The company is in a dominant position in the industrial chain, which is also reflected in the settlement method. Drinda mentioned in its 2022 annual report: "The company's settlement methods for other customers are payment before delivery, and the operating cash flow is better." The Company's settlement methods with upstream suppliers and downstream customers are mainly based on bills."

Second, behind the strong demand for N-type cells is a higher profit margin.

On the one hand, N-type components are in short supply, and the premium is obvious compared to P-type components. The current domestic bidding market premium is about 0.08-0.10 yuan /W, and the premium is higher in overseas markets.

On the other hand, the production cost of TOPCon components is decreasing. According to the data disclosed by Jinkosolar: "In the first quarter of 2023, the integration cost TOPCon is 2-3 cents higher than PERC, and the N-type integration cost is planned to be flat or slightly lower than the P-type PERC cost at the end of the year." Therefore, TOPCon is more profitable than PERC components.

The situation with cells is similar to that with components. In the announcement on April 28, Drinda  shares mentioned: "The current N-type cell price is about 1.22 yuan /W, and the P-type cell price is about 1.05 yuan/W-1.08 yuan /W."

Fast speed, very strong execution, so that Drinda firmly grasp the market opportunity of TOPCon outbreak.

In October 2022, JDA Shares signed a cooperation agreement with the Lianshui County Government of Huai 'an City with an annual output of 26GWn type (divided into two phases, 13GW each) cell cell project.


On May 4 this year, Jiangsu Huaian News Network reported the news that "the first line of Huaian Jietai New Energy project is released, and the second phase project is started at the same time". Shi Zhijun, secretary of the Huaian Municipal Party Committee, mentioned in his speech that the JTPV 13GW cell project achieved 51 days of project construction and 151 days of project production, fully demonstrating the "JTPV speed" and "Huai 'an efficiency".


In general, the expansion of silicon material, silicon wafers, cell chips, and module production capacity is 18 months, 12 months, 9 months, and 6 months, respectively. Janda only takes less than half a year, which is not only faster than the traditional P-type cell, but also much faster than the peer.


Still skills for a long time: professional win the future


For a long time, there have been two different development routes of integration and specialization in the photovoltaic industry.


Since the second half of 2020, affected by the price fluctuations of silicon materials, in order to enhance the security of the enterprise supply chain, many component companies have increased the cell link to improve the capacity matching degree of cell and component. In 2021, vertically integrated enterprises have new cell production lines that continue to come online, and the self-sufficiency rate continues to improve.


In 2022, after Tongwei announced a major push into modules and promoted the vertical integration strategy, the integration of the entire photovoltaic industry has accelerated again.


As an important part of the photovoltaic industry chain, the market share of cell enterprises is facing the risk of being divided and the market space is crowded by integrated enterprises.


Different cell companies have also chosen different paths:


Tongwei Shares have chosen the road of integration for many years.


Aixu, the second largest company in the industry, has made it clear that its ABC cell is completely produced for its own use, and plans to build a component capacity that fully matches the cell.


The performance of Runyang shares is more aggressive, covering the five links of silicon material, silicon wafers, cells, components and power stations;


The performance of the industry's fourth stock is quite restrained, but it also laid out 5GW components.


In the face of the general trend of industry integration, cell companies have transformed, Drinda made it clear: "In the future, the company will continue to adhere to the road of specialization, concentrate resources to continue to increase research and development investment, continue to master the core technology, to maintain the company in the market competition continues to lead."


If so, Drinda will become the only company that clearly insists on the professional route of large-scale cell enterprises. Drinda go against the trend of the industry, or from its profound judgment of TOPCon technology and market.


First of all, Drinda believe that TOPCon has a broad space for development.


According to the "Review of the development of the photovoltaic Industry in 2022 and the Outlook for 2023", the N-type market share will increase to 9.8% in 2022. According to PV InfoLink, the market share of TOPCon cell will reach more than 20% in 2023, and the market share is expected to reach 30% in 2024, which is one of the main development directions of cell technology at present.


Secondly, TOPCon has a certain technical threshold.


Drinda mentioned in the investor survey: "TOPCon cell production technology is not a technology delivered by equipment manufacturers, and it needs to be jointly developed and explored by cell manufacturers and equipment manufacturers on key process technology links, which tests the technology accumulation of cell manufacturers." Therefore, the company believes that the popularization of TOPCon cell mass production technology in the industry will take some time."


Thirdly, the contraction of competitors is equivalent to the expansion of market space.


A bet on ABC's Asahi stake is equivalent to giving up TOPCon; Runyang has gradually turned to an integrated development strategy and laid out two technical routes (TOPCon and HJT), which is bound to reduce its investment in TOPCon.


At present, the highest degree of integration of photovoltaic enterprises JA Technology, in 2023 integration goal is 90%, there is still a demand for external procurement of silicon materials, cells. Drinda are almost the only large enterprises that sell TOPCon cells externally.


The listed company information comes from the 2022 annual report; First, Chint information comes from news reports


The confidence of Drinda may also come from its own research and development and technology.


The highest theoretical efficiency of TOPCon cells is 28.7%, the average production efficiency of the industry in 2022 is about 24.6%, and most of the leading enterprises have exceeded 25%.


The company adopts the R & D management model of "mass production generation, R & D generation, reserve generation". In the investor exchange activity, Drinda said: The mass production efficiency of TOPCon1.0 products has reached 25.2%. At present, the company is actively promoting the mass production of TOPCon2.0 products through the introduction of SE and other technologies, and it is expected that the mass production conversion efficiency of TOPCon2.0 products can reach 25.5% by the end of 2023. The company's TOPCon cell conversion efficiency increased to 25.8%.



Superimposed on the capacity structure (large size, TOPCon ratio), cost control and other obvious advantages, in this round of cell technology from P-type to N-type change process, Drinda are expected to re-lead the photovoltaic cell industry.