China's PV companies' debts surged by 70.1 billion yuan in three years
July 22 00:09:41, 2025
The photovoltaic giant Wuxi Suntech recently declared bankruptcy, reigniting public attention on the solar energy industry. The financial struggles of PV-listed companies have now become a major concern. According to data from the Beijing Business Daily Investment Weekly, after analyzing 58 annual reports of listed companies, it was found that total liabilities in the sector rose from 255 billion yuan in 2010 to 325.1 billion yuan last year—a surge of 70.1 billion yuan over three years. Meanwhile, more than half of the companies in the sector have not released their annual reports, suggesting that the actual debt burden is likely even higher.
As of now, 58 solar energy-related listed companies have officially published their annual reports. Their total liabilities have now reached 325.1 billion yuan, compared to 304.6 billion yuan in the previous year and 255 billion yuan in 2010. This indicates an average annual increase of 13.7% in debt over three years. At the same time, the net profit of these companies has been declining steadily. In 2012, the combined net profit of the 58 companies was 13 billion yuan, down from 21.7 billion yuan in 2011 and 23.6 billion yuan in 2010. The downward trend in profitability highlights the growing challenges faced by the industry.
The sharp rise in debt, coupled with shrinking profits, reveals the deepening crisis within the PV sector. Despite the industry's declining prosperity, the solar photovoltaic sector had previously attracted massive investment, with many companies expanding production lines rapidly in hopes of capturing market share. This aggressive expansion, often driven by speculative thinking, led to overcapacity and increased debt levels. Many companies expanded without considering long-term sustainability, resulting in the current financial instability.
According to iFinD data, the average non-current liabilities of the 58 listed PV companies account for about 25%. This means that a quarter of the total liabilities are not easily converted into cash in the short term or during the business cycle. Such high levels of long-term debt add to the financial pressure on these firms.
Some industry insiders suggest that more than 50% of the companies may face a higher risk of bankruptcy compared to others. However, others caution that assessing bankruptcy risk solely based on debt levels or liability breakdowns is not sufficient. A comprehensive evaluation of each company’s financial health, market position, and operational efficiency is essential to determine true risks.