中国光伏行业出口增值税退税下调：短期盈利承压，但加速长期行业整合-China Solar Sector Export VAT Rebate Cut Hurts Near-Term Earnings but Accelerates Long-Term Industry Consolidation

Summary of China Solar Sector Conference Call Industry Overview - The conference call focused on the China Solar Sector, particularly the impact of recent changes in export VAT rebate policies on solar and battery products [1][2]. Key Points Export VAT Rebate Changes - The Ministry of Finance and State Taxation Administration of PRC announced the abolition of export VAT rebates for solar products (excluding inverters) from 1 April 2026, and a reduction from 9% to 6% for battery products, including Energy Storage Systems (ESS), effective from 1 April 2026 and abolishing on 1 January 2027 [1]. - The National Development and Reform Commission (NDRC) stated that the objective is to eliminate preferential treatment due to excessive competition in the industry and to address overseas concerns regarding anti-dumping activities from China [2]. Impact on Companies - Sungrow, an inverter and ESS maker, confirmed that the new policy will not affect its inverter sales but will increase the cost of sales for its ESS exports by 3% due to the VAT rebate cut. This is expected to lower its gross profit by 0.9% [3]. - Tongwei, a polysilicon manufacturer, indicated that the export VAT rebate cut would likely lead to higher average selling prices (ASP) and estimated an increase in total operating costs by Rmb364 million or 0.9%. However, the gross loss is projected to increase 1.6 times to Rmb592 million in the near term [6]. - Trina Solar, a solar module maker, had anticipated the VAT rebate cut and included it in contracts with customers. The company reported a 37.6% year-over-year increase in export volume to 120.3 GW during July-November 2025, attributed to the expected cancellation of export tax rebates [7]. Market Outlook - The cancellation of export VAT rebates is expected to accelerate consolidation in the PRC solar industry by eliminating less efficient players, which could benefit industry leaders like Tongwei in the long term [6]. - Analysts maintain Buy ratings on ESS makers Sungrow and Deye, indicating confidence in their ability to navigate the changes [1]. Additional Insights - The conference highlighted the importance of adapting to regulatory changes and the potential for price adjustments in response to the new VAT policies. Companies are preparing for these changes by adjusting their pricing strategies and operational costs [7]. - The overall sentiment in the industry suggests a shift towards a more market-oriented approach, as indicated by the NDRC's comments on anti-involution measures [7]. Conclusion - The recent changes in export VAT rebate policies are expected to have a significant impact on the China solar sector, particularly affecting cost structures and pricing strategies for companies involved in solar and battery production. The long-term outlook suggests potential benefits for industry leaders as consolidation occurs in response to these regulatory changes [1][6].