GXED(SH:600617) Hua Xia Shi Bao·2025-06-21 12:34Core Insights - Chinese renewable energy companies are actively expanding overseas, leveraging their complete industrial chain, continuous technological innovation, and significant cost advantages in solar, wind, and energy storage sectors [1][2] - The overseas operations of these companies yield higher gross margins compared to domestic markets, although they face multiple challenges including policy, market, technology, and legal issues [1][2] Group 1: Market Expansion - Chinese renewable energy companies have established a strong presence globally, from Southeast Asia's solar power plants to offshore wind farms in Europe and energy storage projects in Africa [2] - In 2024, China exported 28.79 GW of solar modules to the Middle East, a year-on-year increase of 99%, with total export value reaching 26.286 billion yuan, up 23.4% [2] - The offshore wind turbine orders for Chinese manufacturers are expected to triple in 2024 compared to previous years, indicating a significant growth in overseas markets [2] Group 2: Storage Sector Developments - The energy storage sector is witnessing substantial investments, with companies like XINWANDA planning to invest approximately 10.8 billion yuan in battery production facilities in Thailand [3] - The global energy storage capacity is projected to reach around 270 GW by 2026, making overseas markets crucial for China's new energy storage industry [3] - In 2024, China's lithium-ion battery exports are expected to reach 3.914 billion units, reflecting an 8.1% year-on-year growth [3] Group 3: Profitability Comparison - Many Chinese renewable energy companies report significantly higher gross margins in overseas markets compared to domestic operations, with companies like Dajin Heavy Industry showing a gross margin of 38.48% overseas versus 22.5% domestically [3] - Contemporary Amperex Technology Co., Ltd. (CATL) reported a gross margin of 29.45% for its overseas business compared to 22.25% for its domestic business in 2024 [3][4] Group 4: Challenges and Strategies - The intensifying competition among major economies has led to increased trade restrictions and local industry policies in the West, posing challenges for Chinese renewable energy companies [5] - Companies are advised to adopt a multi-regional production strategy to mitigate systemic risks associated with sudden policy changes in host countries [5] - Thailand has implemented various policies, including tax reductions and financial subsidies, to attract Chinese renewable energy investments, creating a favorable investment environment [5][6] Group 5: Legal and Compliance Issues - Legal challenges include unstable political environments and inadequate legal frameworks in host countries, which can hinder operations and contract enforcement [6] - Companies are encouraged to conduct thorough research on the legal and investment environment of host countries, ensuring compliance with local regulations [6] - Effective contract management and clear agreements on rights and obligations are essential to navigate potential disputes in international operations [6]