JinkoSolar shares surge on Chinese contract award

JinkoSolar shares surge as solar panel maker wins contract for Chinese power project

Associated Press

Shares of JinkoSolar Holding Co. Ltd. surged after the Chinese solar products maker won a bid to supply panels for a solar energy project in China.

THE SPARK: JinkoSolar said on Monday that it been awarded a contract with China Guangdong Nuclear Solar Energy Development Co. to supply 30 megawatts of photovoltaic modules for a power plant project planned in Hami City, in China's Xinjiang Province.

THE BIG PICTURE: Last week, JinkoSolar posted a $49 million second-quarter loss, joining several other Chinese solar products makers facing dramatically lower demand, price wars and tariffs in their biggest markets.

THE ANALYSIS: The new contract could help JinkoSolar recover from an industrywide decline in revenue. Sales have fallen as a glut in solar panels has dragged down prices. Demand has softened in part because of the economic slowdown in Europe, by far the world's biggest solar market. Chinese producers are also facing accusations that they are engaged in predatory pricing in the U.S. and Europe, and that they have received unfair help from the Chinese government.

SHARE ACTION: U.S.-traded shares of JinkoSolar rose 49 cents, or 17 percent, to $3.34 in afternoon trading Tuesday. Its shares traded above $40 in November 2010 and above $17 last August, and have recovered from a recent 52-week low of $2 reached on Aug. 3.

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