Chinese capital bullish on clean energy industry

The “China Clean Energy and Technology Industry 2017 Second Quarter Investment Research Report” released by PricewaterhouseCoopers on September 19 shows that China ’s clean energy and technology industry investment activities have generally remained active, and high-tech companies are key investment targets. In the second quarter, a total of 51 private equity / venture investment (PE / VC) investment events, 33 merger and acquisition events, and 5 initial public offering (IPO) events occurred. The report believes that the competition between Chinese capital for clean energy and technology industries is inseparable from the recent trend of national policies and regulations focusing on environmental protection and energy, which reflects the trend of green and environmental protection.

The report concludes that in order to thoroughly implement China ’s President Xi Jinping ’s initiative to implement the concept of green development and build a green silk road, the Ministry of Environmental Protection, the Ministry of Foreign Affairs, the Development and Reform Commission and the Ministry of Commerce jointly issued the “On Promoting Green The "Guidelines for the Construction of One Road", and the "Cooperation Plan for Ecological Protection of the Belt and Road Initiative" issued by the Ministry of Environmental Protection in May. On April 1, 2017, the Energy Bureau issued the "Key Points for Standardization in the Energy Field in 2017" to encourage intelligent production of clean energy and comprehensively promote the construction of "Internet +" smart energy.

Against this background, the report shows that in the second quarter of this year, China ’s clean energy and technology industry investment increased significantly, and the investment amount refreshed a single quarter peak in the past three years. A total of 51 PE / VC investment incidents occurred during the quarter, with a disclosed investment amount of USD 1.361 billion. The number of investment cases increased by 45.7% year-on-year, and the investment amount increased by 243.5% year-on-year. Judging from the number of investment cases, China ’s clean energy and technology industry's investment in the secondary industry is still mainly environmental protection, with 23 investment incidents, accounting for 45.1%; the proportion of new materials increased from 14.3% in the previous quarter to second. The quarter's 27.5% rose 13 percentage points. In terms of investment amount, the new energy industry is the largest in the US $ 938.2 million, accounting for 68.9%.

The report further analyzes that in the second quarter, China's clean energy and technology industry mergers and acquisitions totaled 33 cases, and disclosed the value of US $ 924 million, of which only one was a cross-border merger and the other 32 were domestic mergers and acquisitions. The number of M & A cases in the environmental protection and new energy industries dominates, with 18 and 14 M & A cases completed respectively, accounting for 54.5% and 42.4% respectively. Although the new materials industry only completed one case of mergers and acquisitions, it accounted for 42.5% of the industry's total mergers and acquisitions with a value of 392.6 million US dollars, ranking first.

Among them, the report emphasized that, after experiencing the peak of IPO listing in the previous quarter, a total of 5 companies in the Chinese clean energy and technology industry completed their IPOs in the second quarter of 2017. Compared with the first quarter, the speed of IPO review in the second quarter has dropped significantly, and the IPO incident has been halved. At the same time, the amount of IPO funds raised was slightly higher than the previous quarter, reaching 661 million US dollars. Twenty-seven companies listed on the New Third Board, of which 20 occurred in the field of environmental protection, accounting for up to 74.1%.

Wang Binhong, PwC China Power & Utilities Leader, said: "In general, the target companies for the second quarter of China ’s clean energy and technology industry are still mainly mature companies such as NEEQ listed companies and listed companies. China Most of the companies listed on the New Third Board of the clean energy and technology industries are high-tech companies. R & D innovation and technological upgrades are the key to maintaining core competitiveness. These companies are in a high-speed growth period, and they need to introduce institutional investors to maintain competitiveness through additional shares.