TRINA(SH:688599)2025-08-31 16:21Summary of Trina Solar (688599.SS) Conference Call Company Overview - Company: Trina Solar - Industry: Solar Energy Key Financial Highlights - Net Loss: Rmb2,918 million in 1H25 compared to Rmb526 million profit in 1H24, with a net loss of Rmb1,598 million in 2Q25 [1][9] - Operating Cash Inflow: Rmb1,843 million in 1H25, including Rmb2,679 million in 2Q25 [1] - Revenue: Decreased by 27.7% YoY to Rmb31,056 million in 1H25 [9] - Module Shipment Volumes: 32GW in 1H25, with 17GW in 2Q25, reflecting a 5.9% YoY decline [2][9] - Gross Profit Margin: Dropped to 4.9% in 1H25 from 13.4% in 1H24 [9] Core Insights - Anti-involution Policy: Trina Solar emphasized the importance of the Chinese government's anti-involution policy, which aims to prevent selling solar products below cost. This policy is expected to benefit polysilicon makers more than module manufacturers [1][8] - Module Sales Losses: The company reported losses of Rmb0.08/W on module sales in the first half of the year, while distributed systems generated a profit of Rmb0.2/W [2] - Technology Outlook: Trina Solar downplayed advancements in solar cell technology, indicating that TOPCON will remain the primary technology, with marginal improvements from newer technologies [2] Business Segment Performance - Energy Storage System (ESS): The ESS business turned profitable in 2Q25, earning Rmb7-8 million, with a shipment volume of 1.7GWh in 1H25 [6] - Export Focus: 90% of ESS shipments were for exports, with significant orders from the US and a target to double shipment volume to 8GWh in 2025E [6] Market Conditions - US Market Dynamics: The US solar market may see sustained module demand due to installation rushes, despite regulatory changes that could limit new project approvals [7] - Polysilicon Preference: Analysts prefer polysilicon manufacturers like Tongwei over Trina due to uncertain benefits from anti-involution measures for module sales [8] Valuation and Risks - Target Price: Rmb12.00/share based on DCF valuation, indicating a potential decline of 28.3% from the current price of Rmb16.740 [4][16] - Key Risks: Include faster-than-expected global solar installation growth and price competition among module companies [17] Additional Notes - Impairment Losses: Trina may face impairment losses of Rmb400-500 million from its TOPCon production capacity in Thailand [8] - Debt Levels: Total debt increased by 5.8% to Rmb48.9 billion in 1H25, with a net debt to equity ratio rising to 91.1% [9]