JinkoSolar’s Dual-Pronged Strategy for Market Leadership

JinkoSolar US47759T1007

Amidst a solar industry grappling with intense cost pressures, JinkoSolar is making two significant strategic moves. The company is not only securing a landmark project but is also pursuing a critical manufacturing shift to insulate itself from volatile raw material pricing.

A supportive regulatory development adds another layer to the investment case. China's Ministry of Industry and Information Technology (MIIT) has unveiled new measures designed to protect intellectual property within the photovoltaic sector. These rules, expected to cover TOPCon, BC, and perovskite technologies specifically, aim to foster a "fair and orderly" market by 2027. As a holder of extensive TOPCon patents, JinkoSolar stands to benefit significantly from stricter enforcement against patent infringement, potentially solidifying its competitive moat.

A Showcase Installation with Technical Demands

The company announced on Wednesday the installation of a 40-megawatt array using its Tiger Neo modules at the Taiyuan Wusu Zero-Carbon Airport in China. This project serves as a powerful technological showcase. The deployment required specialized anti-glare modules, a necessity near airports to prevent pilot disorientation. Utilizing high-efficiency N-TOPCon technology, the installation is projected to generate approximately 120 million kilowatt-hours of electricity annually upon completion, offsetting an estimated 120,000 tons of CO₂ emissions. Such reference projects within critical infrastructure bolster confidence in JinkoSolar's technological prowess.

The Strategic Shift Away from Silver

The core strategic development, however, lies in production. Reports from January 6th and 7th indicate JinkoSolar is executing a clear plan to reduce dependence on record-priced silver. By the end of 2025, the precious metal constituted over 17% of a module's non-silicon costs—a dramatic surge from just 3% in 2023. This cost inflation severely pressured Chinese solar manufacturers' margins throughout last year.

JinkoSolar's response is a fundamental material transition. The company aims to switch to copper-based technologies in cell production by the end of 2026, thereby replacing silver. This move follows competitor Longi Green Energy, which is targeting a similar shift for the second quarter of 2026. This strategic pivot is viewed as crucial for the long-term restoration of profitability across the sector.

Valuation and Investor Focus

JinkoSolar's equity has benefited from these developments, climbing more than 16% over the past 30 trading days. Market analysts note the shares may be trading substantially below their intrinsic value. A recent discounted cash flow analysis estimates a fair value of approximately $83.07 per share, suggesting significant undervaluation against a current price near $28. Furthermore, the stock's price-to-sales (P/S) ratio of 0.15 remains far below the industry average of 5.78.

Investor attention is now firmly fixed on the execution of the material transition. The ability to successfully replace silver with copper by the end of 2026 without compromising efficiency will be the key determinant of margin progression in coming quarters. Concurrently, the continued acquisition of major infrastructure projects like the Taiyuan airport remains an important growth driver.