Yingli Leads Solar Rally as CFO Predicts Profit: China Overnight

Jan 14, 2014 5:05 pm ET

Jan. 15 (Bloomberg) -- Yingli Green Energy Holding Co. is leading a rally this month in Chinese solar-panel makers as the company predicts it will post its first profit in three years as soon as the second quarter.

Yingli has jumped 35 percent this year and Trina Solar Ltd. has surged 17 percent, after at least doubling in 2013. The Bloomberg China-US Equity Index of the most traded Chinese stocks in the U.S. surged 1.4 percent to 102.69 as of 12:33 p.m. E-Commerce China Dangdang Inc. rose to the highest level since November while YY Inc., a social entertainment website, climbed to a record. Shanda Games Ltd. dropped the most in two months.

Yingli, based in Baoding, China, will post its first profit since 2011 as early as next quarter, Chief Financial Officer Wang Yiyu said in a Jan. 7 interview, indicating growing optimism that solar panel makers are recovering from a price plunge caused by a glut of manufacturing capacity. Yingli said yesterday it partnered with Kyoto, Japan-based XSOL Co. to sell its solar modules in the Japanese market.

“The China-based names are moving as much as they are because they are getting into more of the project development business, which commands higher margins,” Angelo Zino, an analyst at S&P Capital IQ, said by phone from New York yesterday.

The iShares China Large-Cap ETF, the largest Chinese exchange-traded fund in the U.S., rallied 1 percent to $36.05 in New York, after slumping the most in a week. The Standard & Poor’s 500 Index climbed 0.8 percent as retail sales advanced more than forecast in December and investors analyzed earnings from major banks.

The Hang Seng China Enterprises Index in Hong Kong slipped 0.3 percent to 10,149.22, the lowest level in four months. The Shanghai Composite Index gained 0.9 percent to 2,026.84, halting a four-day decline.

--Editors: Marie-France Han, David Papadopoulos