In the context of energy transition, the development of China's new energy industry has accelerated. On the afternoon of June 9, 2023, the signing ceremony of the new energy capital increase war of Power Construction, a holding subsidiary of Power Construction of China, was held at the Beijing Equity Exchange. A total of 10 strategic investors were introduced in the capital increase, raising 7.625 billion yuan.

On the same day, the legal representative of Power Construction New Energy signed a capital increase agreement with representatives of 10 strategic investors, including Southern Net Double Carbon Fund, ICBC Investment, Taiping Life, Bank of China Assets, and CRRC.

The reporter noted that recently, China Power Construction in promoting the transformation of the new energy industry action frequently. At the end of 2022, the company completed the joint-stock transformation of its subsidiary power construction new energy, and completed 13.4 billion yuan in January this year to raise funds for new energy and pumped storage. It is worth mentioning that China Power Construction also continued to increase investment in new energy projects.

According to the company's latest plan, the total investment plan in 2023 is 143.028 billion yuan, and the total investment plan in 2023 is 59.659 billion yuan in the energy and power sector, of which the new energy project investment plan is 47.483 billion yuan.

Subsidiary power construction new energy contract

On June 9, the signing ceremony of the new energy capital increase war of Power Construction, a holding subsidiary of Power Construction of China, was held at the Beijing Equity Exchange.

At the ceremony, the legal representative of Power Construction New Energy Group signed the capital increase agreement with representatives of 10 strategic investors, including Southern Net Double Carbon Fund, ICBC Investment, Taiping Life, Bank of China Assets, and CRRC. It is reported that the capital increase introduced a total of 10 strong strategic investors, raising funds of 7.625 billion yuan.

"The capital increase of Power Construction New Energy Group is an important practice for Power Construction to actively connect with the capital market and implement the reform of state-owned assets and state-owned enterprises, and it is also an important measure to optimize the state-owned capital structure and promote the high-quality development of domestic new energy business." China Power Construction Party secretary, chairman Ding Yanzhang pointed out.

Since the beginning of the layout in 2016, new energy has become an indispensable part of the international business development of China Power Construction. In May 2022, PowerChina launched a 15 billion fundraising plan to invest in new energy and pumped storage. In the middle of January this year, China Power Construction disclosed the results of the fixed increase issuance, the company to 30 specific objects for non-public issuance of 2.08 billion shares, raising a total of 13.396 billion yuan, also won the support of a number of well-known institutions.

Among them, Taiping Asset Management Limited (Taiping Life Insurance Company Limited - Traditional - general insurance products) was the single largest subscriber, subscribing 543 million shares at a cost of $3.5 billion. The second phase of the State-owned Enterprise Structural Adjustment Fund and the Mixed Ownership Reform Fund of State-owned enterprises subscribed 233 million shares and 200 million shares, respectively, with 1.5 billion yuan and 1.29 billion yuan.

After the landing of the boots, Power Construction of China continued to promote the transformation of industrial strategy. On February 23, the board of directors of China Power Construction passed the proposal of introducing strategic Investors to its subsidiary Power Construction New Energy. On June 2, the "Suggestive Announcement on Planning the spin-off and listing of the Holding subsidiary" was released again, intending to plan the spin-off of Power Construction New Energy to the domestic stock exchange, and authorized the company's management to start the preparatory work for the spin-off and listing.

According to reports, power construction new energy is a subsidiary of China power construction holding subsidiary hydropower new energy as an integration platform, deep integration of hydropower consultants and 41 new energy project companies from 10 member units of China Power construction, Power Construction of China is the only intensive development of new energy business brand.

It is worth mentioning that the spin-off of the new energy sector of China Power Construction seems to have been planned. At the end of 2022, the shareholding transformation of Power Construction New Energy Company was successfully completed, and Power Construction of China achieved leapfrog development in obtaining new energy resource reserves and development and construction.

In 2022, Power Construction New Energy achieved annual revenue of 8.39 billion yuan and net profit of 1.85 billion yuan; By the end of 2022, the grid-connected installed capacity of Powerconstruction New Energy Holding Fengfeng new energy is about 10 million kilowatts, and it has ranked among the first-class enterprises in the domestic new energy investment and operation industry, with total assets of 66.83 billion yuan and net assets of 18.03 billion yuan at the end of the year.

Divest real estate business to promote new energy transformation

According to public information, Power Construction of China, formerly known as China Water Resources and Hydropower Construction Co., LTD., was jointly initiated by China Water Resources and Hydropower Construction Corporation and China Hydropower Engineering Consulting Group Corporation on November 30, 2009, and landed on the main board of Shanghai Stock Market in 2011.

It is understood that the company was originally mainly engaged in engineering contracting and survey and design, power investment and operation, real estate development, equipment manufacturing and leasing and other businesses. However, due to external factors such as the market, its real estate business is not ideal. In 2020, China Power Construction began to divest its real estate business, and its holding listed company Southern Land proposed to absorb and merge its subsidiary Power Construction Real Estate, but it was subsequently terminated. In 2022, the company will further divest the remaining real estate business in its body to replace the assets held in the real estate sector with the high-quality power grid auxiliary industry assets held by Power Construction Group, so as to properly solve the problem of industry competition between the company and the controlling shareholder Power Construction Group.

In June of the same year, China Power Construction also transferred its real estate assets to Power Construction Group and its subsidiaries by non-public agreement transfer, and the amount of this related transaction was about 4.94 billion yuan. Upon completion of the transaction, PowerChina will fully exit the real estate business.

At the same time, PowerChina is also accelerating the new layout of new energy and pumped storage planning, design, construction and investment management, and actively building a new pattern of new energy and pumped storage business development.

In 2022, the four indicators of new construction indicators, new investment projects, new construction projects, and cumulative installed capacity of Power Construction of China exceeded 10 million kilowatts.

In 2022, the company also added wind power, solar photovoltaic power generation, hydropower installed capacity of 1.36 million kilowatts, 1.272 million kilowatts, 373,000 kilowatts. By the end of 2022, the company held a grid-connected installed capacity of 20.3834 million kilowatts, including 7.6444 million kilowatts of wind power, an increase of 21.64%; The installed capacity of hydropower was 6.8554 million kW, up 5.75% year-on-year; The installed thermal power capacity was 3.16 million kW, basically the same as the previous year; The installed capacity of solar power generation reached 2,723,600 kW, an increase of 87.63% year-on-year. Clean energy accounted for 84.5% of the total.

During the same period, the newly signed contract amount of the company's engineering construction and survey and design business was 1,009.2 billion yuan, an increase of 29% year-on-year, and 103% of the total planned new contracts. Among them, the newly signed contracts for energy and power, infrastructure, water resources and environment were 453 billion yuan, 356.6 billion yuan and 176.7 billion yuan, respectively, with year-on-year changes of 45%, -2% and 36%. Among the energy and power contracts, the newly signed photovoltaic, wind power and pumped storage contracts reached 193.6 billion yuan, 145.5 billion yuan and 24.3 billion yuan, an increase of 410%, 68% and 20% respectively.

In 2022, Power Construction of China achieved annual revenue of 571.649 billion yuan, an increase of 1.16%; Net profit reached 11.435 billion yuan, up 15.93% year on year.

At the same time, China Power Construction continues to increase investment in new energy projects. According to the company's latest plan, the total investment plan in 2023 is 143.028 billion yuan, and the total investment plan in 2023 is 59.659 billion yuan in the energy and power sector, of which the new energy project investment plan is 47.483 billion yuan. Editor/Xu Shengpeng