Plenty of mixed signals were blowing through the latest annual results of Goldwind Science And Technology Co. Ltd. (2208.HK; 002202.SZ), whose fate is largely tied to China’s policy-driven wind power market. The company has been a major beneficiary of policies that have built China into a wind powerhouse over the last few years, with about half the world’s installed capacity for the clean energy source.
Of the roughly 70 GW of new wind power installed in the first half of last year, well over half – about 44 GW – came from China, according to Wood Mackenzie. That helped to bring China’s wind power capacity to 440 GW by the end of last year, compared with more than 900 GW globally.
But fierce competition in China has hurt Goldwind’s profits, which fell sharply in the second half of last year. At the same time, China is showing signs of easing construction of new wind farms due to the huge existing supply. That’s a big development for Goldwind not only because China accounts for more than 80% of its overall sales, but also because the company is a major developer of wind farms.