Xinyi Solar Shares Slide After First-Half Net Profit Decline

By Ronnie Harui

Xinyi Solar Holdings' shares slid early Tuesday after the company said its first-half net profit fell 27%.

Shares were recently 9.5% lower at 7.61 Hong Kong dollars (US$0.98) after earlier touching HK$7.22, their lowest intraday level since October 2022, according to FactSet.

The Chinese photovoltaic-glass manufacturer said after Monday's market close that net profit declined to HK$1.39 billion in the first half of 2023 from HK$1.90 billion for the same period a year earlier. However, revenue increased to HK$12.14 billion in the first half from HK$9.70 billion.

Pressure on the company's gross margin, together with the impact of yuan depreciation, led to lower gross profit contribution from its solar-glass business in the first half, compared with a year earlier, Xinyi Solar said.

Also, profit contribution from the company's solar-farm business dropped in the first half, primarily owing to the yuan's depreciation and high finance costs, the company added.

However, Citi maintained its buy rating on Xinyi Solar's shares as management has guided for significant gross profit margin recovery in the second half, given better demand and lower soda ash and natural gas costs, the bank's analysts said in a research report.

Write to Ronnie Harui at ronnie.harui@wsj.com

(END) Dow Jones Newswires

July 31, 2023 22:40 ET (02:40 GMT)

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