| Global Times | 2012-7-31 21:25:03
By Wang Jiamei in Shanghai
Shanghai-listed Sinovel Wind Group Co Ltd, China's largest manufacturer of wind turbines by revenue, has modified its plans for how it intends to allocate the funds it raised from its initial public offering last year, the company announced Tuesday, marking the second time since its listing that the company has adjusted its fund distribution schedule.
Sinovel Wind said in an announcement that it will put about 1 billion yuan ($156.75 million) originally earmarked for two offshore wind power projects near Dalian and Tianjin into three projects in Laoting, Hebei Province; Chuxiong, Yunnan Province; and Datong, Shanxi Province - the latter two of which are onshore projects.
Yet, this doesn't mean Sinovel Wind will abandon its Dalian and Tianjin projects, which will continue to be funded with the company's own capital, an officer from the office of the company's board of directors told the Global Times Tuesday.
In January 2011, the company raised 9.45 billion yuan to finance seven projects; four of which have since been replaced by new ones.
"Sinovel is trying to ease its burdens by turning to more promising projects," Lin Boqiang, director of the China Center for Energy Economics Research at Xiamen University, told the Global Times. "Its decision points to a strategic switch from offshore farms to inland projects as most offshore wind power projects in the country are currently mired in location disputes due to poor coordination between energy and ocean authorities."
Meanwhile, the frequent changes to its funding use blueprint also underline the severe hardships facing the Chinese wind energy industry, Lin said.
"On one side, serious overcapacity continues to plague the industry in the domestic market, which is now consolidating in much the same way the solar energy industry is," Lin explained.
"While in the overseas market, China's wind turbine makers have suffered a major setback recently thanks to deepening trade disputes between the US and China involving wind towers," he noted.
The US Commerce Department determined Friday that wind tower makers had dumped their wares in the US at below-fair value prices. It levied anti-dumping tariffs of 20.85 percent on Titan Wind Energy Co Ltd, 26.25 percent on CS Wind Corp and Sinovel Wind Group Co as well as 72.69 percent on other Chinese producers, the Wall Street Journal reported.
Under these circumstances, Sinovel's profits in the first half of this year are projected to drop by over 50 percent year-on-year, according to its forecast for the period. In the first quarter, the company saw its revenue and profits slump by 65.5 percent and 87.1 percent year-on-year respectively.
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