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Text |Read finance and economics.After the logic of going overseas is realized, it can often boost the valuation of a company or industry. However, there is a strange phenomenon of wind power going overseas: the stock price is still sluggish after the outbreak of overseas orders.
According to CCTV News, as of the end of October, there were 37 orders for offshore wind power installation ships from shipyards around the world, and nearly ninety percent (33) were manufactured by Chinese shipyards. In the first three quarters of this year, Daikin Heavy Industries' overseas business revenue increased by 71% year-on-year50%。
Compared with the hot overseas orders, the stock prices of wind power companies are still cold. Since the beginning of the year, the share price of wind power leader Goldwind Technology has been 23%, and the share price of Mingyang Intelligent has been nearly halved at 48%.
There is no doubt that there is a broad market space for going overseas, and after the energy crisis in Europe, the transformation of wind power has been increased. By 2023, demand for wind turbines will nearly quadruple in some countries. Why are wind power companies that have already received orders to go overseas still not favored by the capital market?
This article holds the following views:
The cost advantage of wind power going overseas has been weakened. Wind power going overseas is not only about "selling wind turbines", but also about completing the construction of wind power projects. In the construction of the project, some European countries emphasize the localization of the industrial chain. After cooperating with overseas industrial chains, domestic enterprises will more or less encounter the high cost problem of European wind power enterprises, and their profit margins will be compressed.
The overseas wind power market is also very volatile. European oil and gas giants such as BP and Total are grabbing wind power orders regardless of cost. Germany has introduced a negative subsidy bidding policy, and enterprises can give subsidies to the first order, and the one with the highest price wins the bid. The competitive environment overseas is not conducive to the profit improvement of wind power enterprises.
Going to sea cannot change the core contradiction of the current domestic war. The overcapacity rate of domestic wind power is more than 50%, and wind power manufacturers have started a war, and offshore wind turbines have dropped from about 7,000 yuan to about 3,500 yuan at present. The wave of expansion of wind power enterprises is still continuing, and there is no sign of the end of the war.
Since the beginning of this year, the situation of wind power enterprises going overseas has been very good, and leading wind power enterprises have announced that they have signed large overseas orders.
For example, Mingyang Intelligent won the bid for the Serbian 150MW wind turbine procurement project and won the bid for **7900 million yuan. Zhongtian Technology pre-won the bid for the 275kV high-voltage AC submarine photoelectric composite cable and its supporting accessories for the Danish Baltica 2 offshore wind power project (package B), and the pre-winning bid amount is equivalent to about 120.9 billion yuan.
Other companies have also won orders one after another. According to CCTV News, as of the end of October, there were 37 orders for offshore wind power installation ships from shipyards around the world, and nearly ninety percent (33) were manufactured by Chinese shipyards.
Wind power also has broad market prospects for going overseas. Due to the energy crisis, offshore wind power has become an important transition direction in Europe.
In terms of specific planning, the UK plans to achieve 50GW of offshore wind capacity by 2030, Germany plans to reach 30GW of offshore wind capacity by 2030, and France has committed to reach 40GW of offshore wind capacity by 2050. You must know that in 2022, the cumulative capacity of the United Kingdom, Germany, the Netherlands, and Denmark will only be about 28GW, and according to the capacity planning of major European countries, even if it is assumed that the European ** turbine will achieve 100GW in 2030, the demand for wind turbines in Europe will expand by nearly 4 times.
Before the expansion of wind power in Europe, there was a situation where the supply of wind power in Europe was in short supply, and at present, except for China, the capacity satisfaction rate of global offshore wind power infrastructure is less than 70%, providing an opportunity for wind power to go overseas.
Going overseas has brought a broad market space, and domestic leaders have already received orders. Under the high expectations and order fulfillment, the stock prices of wind power companies should soar. But the reality is the opposite, and the stock prices of wind power companies are still falling. Since the beginning of the year, the share price of wind power leader Goldwind Technology has been 23%, and the share price of Mingyang Intelligent has been nearly halved at 48%.
Why did the surge in overseas orders fail to save the stock prices of wind power companies?
For every wind turbine we sell, we lose 8%. Henrik Andersen, CEO of Vestas, said in an interview last year.
As Europe's largest wind turbine manufacturer, Vestas' net profit fell by 38% in 202153%, with a loss of 15 in 2022At 7.2 billion euros, gross margin fell from 10 percent to 08%。Siemens Gamesa, another major wind turbine giant in Europe, performed even worse, losing 9. from fiscal year 2020 to fiscal year 20221.8 billion euros, 62.7 billion euros, 9400 million euros.
The loss of overseas wind power giants is due to inflation and the continuous cost of raw materials, so that the cost price of wind turbines of many manufacturers has exceeded the bidding price. Compared with European wind power companies, domestic wind power companies naturally have a cost advantage, but this cost advantage is weakening.
Different from other products going overseas, wind power going overseas is not only about selling wind turbines, but also about completing the construction of wind power projects, which means that enterprises need to participate in certification, logistics, construction and installation in different overseas countries. In the construction of wind power projects, wind power enterprises must cooperate with the local industrial chain. For example, Scotland and the United Kingdom have put forward requirements for the localization of ** chains. At the same time, the four Nordic countries also stressed the need to ensure energy security and independence at the North Sea Wind Power Summit.
European countries emphasize the localization of the industrial chain, which means that Chinese wind power enterprises should realize the globalization of the entire industrial chain. Many domestic manufacturers in the wind power industry chain have begun to go overseas in a planned and large-scale manner. For example, Tian Qingjun, senior vice president of Envision Group, which has the second largest market share of wind turbines in China, said that Goldwind will not take out all the domestic first-class chains when it goes out, but will make good use of existing resources locally. At present, Envision Group has set up OEMs and blade factories in some overseas countries.
After cooperating with overseas industrial chains, domestic enterprises will also encounter the high cost problem of European wind power enterprises to a greater or lesser extent, and their profit margins will be compressed. What's more, the European wind power market is also changing.
In July this year, the results of Germany's first special offshore wind bidding were released, and the two winning bidders paid a total of 12.6 billion euros (100.9 billion yuan at the time) to win 7GW of offshore wind power projects, relying on the "negative subsidy" unlimited rule in the special bidding. The so-called "special bidding" refers to the fact that in some bidding, negative subsidies are allowed, that is, developers can propose to pay a fee to the federal ** on the basis of zero subsidized electricity prices, and the fee is not capped, and the higher price wins.
Germany's courage to introduce negative subsidies comes as the European wind power market is facing a giant disruption. Oil and gas giants such as BP and Total Energies are transitioning to wind power at any cost. European practitioners believe that oil and gas giants such as bp and Total will continue to adopt a "negative subsidy" and uncapped bidding approach, throwing a lot of money at the expense of winning projects.
European oil and gas giants are rushing to projects regardless of the cost, which has cast a shadow on domestic wind power going overseas. In addition to the uncertainty of offshore business, the domestic business of wind power companies is also facing difficulties.
In the first three quarters of 2023, the profitability of wind turbine manufacturers will decline further: the net profits of Goldwind, Mingyang Intelligence, and Yunda Co., Ltd. will decline respectively. 4%。
The decline in net profit is due to the decline in the installed capacity of new wind power after the demand for wind power was overdrawn, resulting in overcapacity, which in turn caused the industry to war. After 2020, wind power subsidies were gradually abolished, and there was a rush to install in the industry, and China's new wind power installed capacity reached the highest point in 2020: 7167gw。However, the number of new wind turbines has then declined, falling to 47 in 2021 and 2022, respectively57GW and 3763gw。
With the decline in the number of new wind turbine installations, the wind power industry has overcapacity, according to Polaris Power Network, the wind power overcapacity rate is more than 50%. Subsequently, wind power manufacturers started a first-class war. According to statistics from the Wind Energy Committee of the China Renewable Energy Society and other institutions, the average bidding for onshore wind turbines** fell from 3,100 yuan kW in January 2021 to about 1,700 yuan kW in December 2022. At present, the bidding ** is still at a low level of about 1500 yuan kilowatts. Offshore wind turbines** have dropped from about 7,000 yuan kilowatts to about 3,500 yuan kilowatts at present.
At present, the situation of domestic wind power overcapacity cannot be reversed in the short term. The development of wind power in China's onshore and offshore wind resources has been relatively mature, and offshore wind power is the remaining new increment in the industry. However, due to the high cost, there is a big bottleneck in the application of offshore wind power.
In new energy power generation, the installed capacity of wind power has always been ahead of solar power generation. In 2022, the two positions were reversed, and China's installed solar power capacity surpassed that of wind power for the first time. The core logic of this is that with the advancement of technology, the cost of photovoltaic has fallen faster, and the cost of electricity has reached the same level as that of wind power. As shown in the figure below, the cost of electricity for offshore wind power, especially offshore wind power, is already higher than that of photovoltaics, and in the case of higher costs and less flexibility than photovoltaics, offshore wind power is prone to encounter bottlenecks.
In the case of bottlenecks in domestic wind power applications, wind power enterprises have set off a wave of expansion in overcapacity. Since the beginning of this year, Jinko Power plans to invest in the construction of 200MW wind power projects. Zhenjiang Co., Ltd. is expected to invest 5 billion yuan to build an offshore wind power product production base. Goldwind is expected to invest a total of 13.3 billion yuan to build a new energy equipment industrial base in Qinhuangdao, Hebei Province. It is foreseeable that there is still no signal of stopping the industry war.
When it is difficult to drive the profits of wind power enterprises in the short term, and there is no signal of the end of the war in the domestic market, wind power companies are still in a cruel and fierce knockout competition.