January 29, 2008 (MarketWatch) – ReneSola, the China manufacturer of silicon wafers for solar power cells, priced its U.S. stock offering at a discount Tuesday and the shares rose in the open market. The company debuted in the U.S. in the wake of recent weakness in alternative-energy shares.
ReneSola offered 10 million American depositary shares at $13 each, raising $130 million via underwriters Credit Suisse and Deutsche Bank Securities. The stock closed at $12.99, down a penny, in its first day of trades. The IPO priced at a 9.7% discount to the company’s closing price Monday on the AIM market on the London Stock Exchange, according to Renaissance Capital.
The Jiashan, Zhejiang company supplies thin sheets of crystalline silicon to customers including JA Solar Co. (JASO), Motech Industries Inc., (MIDIL), Solarfun Power Holding Ltd., (SOLF), Suntech Power Co. (STP) and Topco Technologies Corp.
The IPO comes despite weak performances this year from many alternative-energy stocks after a big run-up in 2007. Suntech Power, for example, has fallen to $50 a share from near $90 a share just in the past month. First Solar (FSLR) is well below $200 a share after nearing $300 a share during the same time. SunPower (SPWR) is now in the $70s range after trading at $140 about a month ago.
“We believe we are well positioned to address the challenges presented by the current industrywide shortage of silicon raw materials,” ReneSola said in its prospectus. “Aiming to enhance our competitive advantage as a low-cost producer and to secure a reliable long-term supply of feedstock, we have taken steps to expand into upstream polysilicon manufacturing.”
Profit from operations grew to $25.5 million for the nine months ended Sept. 30 from $16 million in the year-ago period. Revenue increased to $84.4 million in 2006 from $5.1 million in 2005. For the 2007 nine months, revenue nearly tripled to $153 million from $52.1 million in the year-ago period.