GCL Technology Jumps After It Raises $700 Million for Supply Reform

By Jason Chau

Shares of solar-materials producer GCL Technology rose on Tuesday after it raised about US$700 million as part of efforts to address an industry-wide supply glut.

The stock gained as much as 7% during early trade before paring gains to 4%. That left year-to-date gains at 21%.

In an exchange filing, the company said it issued 4.7 million shares for 5.45 billion Hong Kong dollars, equivalent to US$700.5 million.

GCL, which makes polysilicon--a key material used to make solar panels--issued the share to Hong Kong-based hedge fund Infini Capital Management.

It plans to use a portion of the funds raised to establish a capital reserve for supply-side reform and restructure its production capacity.

Companies like GCL, one of the biggest suppliers of polysilicon in China, have been struggling with solar-sector overcapacity and pricing competition for years.

Recent efforts by the Chinese government to rectify supply-demand imbalances should help ease the strain, analysts say.

Tightened energy usage caps on polysilicon production would be a step in the right direction, Citi analysts said in a report, citing an industry news site.

Cutting industry production capacity would boost consolidation, and the polysilicon segment looks well-placed to benefit, Pierre Lau and Air Ma said.

GCL will also use the share proceeds to strengthen its silane gas business as new solar cell and solid-state battery technologies drive up demand for the chemical, a source of silicon in the semiconductor and solar cell industries.

Deutsche Bank analyst Gary Zhou names GCL as his top sector pick, viewing it as a key beneficiary of supply-side reform.

"We also like its long-term cost advantage in the polysilicon industry," he wrote in a note.

Write to Jason Chau at jason.chau@wsj.com

(END) Dow Jones Newswires

September 16, 2025 05:37 ET (09:37 GMT)