Wall Street’s Response to Jinko Solar: MEH

China-based Jinko Solar withdrew its IPO plans earlier this year due to "poor market conditions."  Jinko manufactures silicon solar wafers, cells andmodules and had hoped to raise $100 million.  

Late last week,the firm managed to go public on the NYSE, raising approximately $64million in its maiden offering. Here’s a link to the prospectus. The company’s 5.84 million Americandepository shares sold for $11 per share — at the low end of the$11-$13 range.  Jinko had raised more than $30 million in venturefunding from CIVC, Shenzhen Capital, Pitango Venture Capital, et al. in2008.

Obviously, investors are a bit jittery about the solarindustry in an environment where slim margins exist for commodity-levelwafers and modules — and where soon-to-be curtailed German subsidiesmight impact demand while the world waits for the U.S. and other markets to take off.

Jinko had sales of $80.4 million in the firstquarter, a 20 percent drop from the fourth quarter of last year. Margins grew to 24 percent, from 16 percent in the fourth quarter.  Jinkomanaged to make $12.5 million in profit in 2009.

The vertically integrated firm has solar cell and module manufacturing capacitiesof about 200 megawatts with intentions to grow that capacity to 500megawatts by year end. This makes Jinko the smaller of the verticallyintegrated China-based solar firms like Yingli or Suntech.  Jinko hasmore than 400 customers and a deep relationship with troubled feedstockaspirant Hoku.  The prospectus is full of risk statements regardingHoku’s performance.

If a relatively profitable solar firm hassuch tepid results — what are the prospects for an IPO aspirant like Solyndra?



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