Initiating Coverage of Trina Solar With a No-Moat Rating and CNY 30.90 Fair Value Estimate

Trina Solar is one of the four largest Chinese solar module producers. Despite adopting a vertically integrated model, Trina has the smallest degree of vertical integration of its top competitors. As of 2023, Trina’s solar wafer capacity was only 73% of its solar cell capacity and is projected to drop to 52% by the end of 2024, according to the current capacity plan. The lower solar wafer capacity offers Trina a near-term advantage, as external procurement can be more cost-effective than internal supply due to severe overcapacity in solar wafers.