LONGi Green Energy Plans to Go Public in Switzerland

Image Source : China Visual

BEIJING, June 21 (TiPost)—— LONGi Green Energy, a leading Chinese solar-power equipment maker, announced its plan to issue Global Depository Receipts (GDR) on the Swiss Stock Exchange on Tuesday.

According to LONGi, the overseas listing aims at increasing production capacity and international business expansion, and enhancing the company's comprehensive competitiveness in the global market, diversifying marketing channels, beefing up advanced technology research and development.

According to the listing plan, LONGi will raise 19.996 billion yuan ($2.78 billion) to expand production in China and abroad, including 46GW silicon wafer and 30GW cell capacity in Ordos, Inner Mongolia, 6.6GW silicon rod and 2.8GW module capacity in Malaysia, and 3.35GW cell capacity in Vietnam.

As one of the world's largest PV module and wafer manufacturers, LONGi continues to scale up its production capacity across the world. LONGi currently has a combined capacity of more than 10GW of silicon wafers, cells, and modules in Malaysia and Vietnam.

The overseas listing helps promote the company’s global expansion and cope with the risk of international trade protectionism. 39%, 47%, and 37% of LONGi Green Energy's overseas revenue were generated in 2020, 2021 and 2022 respectively.

LONGi noted that as countries value the development of renewable energy, the trend of decentralization of manufacturing capacity in the PV industry is obvious in overseas markets. With the changes in international geopolitics and import and export trade policies, relevant countries and regions have introduced trade protection measures and policies to encourage manufacturing industries to return to their home countries.

In order to circumvent the adverse impact of international trade barriers and the trend of reverse globalization on China's PV industry, the company continues to explore the potential demand of the foreign PV market. Through the listing, LONGi will further build a complete overseas industrial chain from monocrystalline silicon rods and wafers to cells and modules in Malaysia and Vietnam to meet the fast-growing global PV market demand.

However, the issuance is subject to the approval of the Shanghai Stock Exchange, the China Securities Regulatory Commission and the Swiss Stock Exchange.

The main purposes of GDR issuance by A-share listed companies are to diversify the company's international financing channels, expand overseas market share, and enhance the international clout of the brand. As an asset-heavy industry, the energy sector has large demand for financing.

LONGi Green Energy also pointed out that since the PV industry is capital-intensive and highly dependent on technology advancement, it has high requirements for capital strength. As the downstream demand in the PV market is strong, the equity financing is an inevitable choice for the company to cope with the competition in the industry, enhance capital strength, expand the advanced production capacity in the industry, maintain and strengthen its postion in the industry, and acquire a bigger market share.