3. Three-year investment changes of photovoltaic stocks from JA Solar

This year has been quiet for a long time, and I feel that I haven’t written a long article for a long time.

I am a novice, an investment novice. Maybe my ideas and some experiences are representative. The so-called I see you, you see me. I am most familiar with JA Solar. In this article, I will take JA Solar as an example to share the three-year investment changes in photovoltaics.

If there is a sincere love in front of you again, what would you do?

For investors, if there is a ten times stock in front of you, what will you do?

This question is my current state of mind, this ten times stock is JA.

First, the basic common sense stage.

I started working at JA Solar in 2020. At that time, JA Solar was also called Tianye Tonglian, a machinery manufacturing company. JA’s backdoor listing was very difficult for JA and even most photovoltaic companies at that time, and financing was difficult, and short-term funds through backdoor listing did not get much relief. At that time, the industry had just experienced the 531 winter in 2018 and was in the recovery stage, and many people in the industry were also confused.

In my impression, the stock price of JA Solar at that time was 13 or 4 yuan, and the market value was less than 20 billion, which was about a hundred.

Why buy JA? At that time, it was very simple, because I was a practitioner and had used JA modules, and I was still familiar with the industry. At that time, the market value of LONGi had already risen. As a benchmark, I felt that JA was undervalued, that’s all. At that time, it was not known what would happen to JA Solar and the photovoltaic industry in the end.

But there is one thing, I started from JA Solar to really study a company, study the industry, right or wrong, and start the road of independent thinking.

At that time, there were several interesting points about photovoltaic investment:

1. The focus of the Snowball PV debate is whether PV is a liar or not just to cheat subsidies.

2. A batch of LONGi fans gained a lot and began to form beliefs.

3. JA Solar began to emerge from a little-known backdoor stock.

I think that in 2020, that year is more about the correction of common sense and the stage of poor cognition. In 2020, JA’s share price rose to 53 yuan (post-resumption price), an increase of 257%.

The installed capacity of the industry in that year was about 120GW, and the optimistic data predicted at that time was 140-160-180GW in 2021-23.

Second, the basic belief stage.

Time comes to 2021, and the situation changes.

First, the actual controller was arrested, and JA Solar was almost cut in half in the short term, and the stock price fell back to more than 30. After the actual controller was arrested, negative news continued to come out, including some previous bad histories. The stock price is constantly falling, the new successor is slow and mediocre in responding to the industry, and the logic of holding shares is constantly being doubted and denied. There are many cynics in the snowball. It was the most difficult time when there was a sense of anger in my heart.

But after nearly a year of study and research, I have become very familiar with JA Solar. At that time, it is the year when I am really familiar with a company and truly recognize JA Solar. By virtue of belief, the shareholding does not move like a mountain.

At that time, Snowball’s photovoltaics also had some interesting points:

1. Cognition is popularized, and more and more people recognize photovoltaics

2. At the beginning of the year, the three Musketeers of photovoltaics, LONGi Tongwei Sunshine, believed that the strong will always be strong.

3. Component stocks began to be recognized, and there was a wave of market conditions at the end of the year.

I think 2021 is more about the persistence of belief, and at the same time, the performance of many photovoltaic stocks continues to explode. In 2021, the share price of JA Solar will be 121 (post-resumption price), an increase of 127%.

That year, the installed capacity of photovoltaics was about 160GW, and the forecast data for installed capacity in 2022 and 2023 was 180-220GW.

3. Overwhelmed 2022.

In a blink of an eye, 2022 has arrived.

The industry continues to game, with silicon as the king, and the voice is rising.

The industry profits are really revealed. JA Solar’s ​​semi-annual report profit of 1.7 billion has exceeded the full year of 2020.

The annual installed capacity of the industry has surged. The current forecast data is 300-350GW, and some companies even predict 400GW.

The industry is very lively, and there are many cross-border photovoltaic players with a lot of money.

JA’s share price rose to a maximum of 150 (post-resumption price), and as of August 29, JA’s annual increase of 2%.

Fourth, the level of right and wrong.

Many people always want to characterize a thing or a person, discuss what is right or wrong, and distinguish between black and white. However, there is no right or wrong in the stock market, only the level of earnings from the recognition of the exchange. Benefit is the realization of cognition, and this view is the deepest experience.

Looking back, there are some emotions I have to say:

1. The rise of the photovoltaic industry is supported by fundamentals. In three years, the scale will increase by nearly 2 times. Some drawbacks of the fast-growing industry will be covered. The industry is a general direction of investment.

2. The cognitive gain realized by the cognitive difference brought about by cognitive bias correction may be the largest.

3. The total profit space during the industry game is huge, but it is not available to ordinary people.

It is lucky to stay with JA Australia, and 10 times the shares are hard to come by. But looking back, I was in the 20-plus positions and cleared the positions around 80, and the real profit margins were limited. A lot of golfers I know can basically eat a price difference of about 10. The old JA fans basically made money, but many of them didn’t make money in the end, and most of these people were short-term. When it comes to 10 times the earnings of stocks, what will happen to the earnings of individual stocks in a downtrend?

Concentrated long-term holding is an avenue for the rapid appreciation of ordinary retail assets, which requires a little luck, a little perseverance, and some research. The road to investment is long and difficult.

$JA Solar(SZ002459)$

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