China's Goldwind Sci & Tech IPO hoping for success like Suzlon, Vestas

Goldwind IPO as China seeks 120,000 megawatts of windpower

Goldwind Plans IPO as China Combats Climate Change (Update2)

By Ying Lou

Dec. 13 (Bloomberg) -- Goldwind Science & Technology Co., China's largest maker of wind turbines, plans to raise 1.8 billion yuan ($244 million) in an initial share sale to boost output as the country seeks to reduce its reliance on coal.

Goldwind will sell 50 million shares at 36 yuan apiece, the Xinjiang-based company said in a statement to the Shenzhen Stock Exchange. can buy the stock today and tomorrow, and it will start trading ``soon'' after the sale, Goldwind said.

Chinese officials at the United Nations Climate Change Conference in Indonesia are showcasing their government's efforts to curb emissions of gases that cause global warming. The nation's climate-change program sets a target to slash 950 million tons off greenhouse emissions by 2010 by using nuclear energy, biomass fuels, hydropower, gas and wind power.

``China is already the world's factory,'' Yang Ailun, climate change program manager at Greenpeace China, said in an interview in Bali, Indonesia on Dec. 11. ``It could be and should be the manufacturing hub of clean technology for the world as well.''

The nation wants to reduce a reliance on coal for almost 80 percent of the electricity used in the world's fastest-growing economy. China passed the U.S. last year to become the world's largest source of carbon dioxide gas, from burning fossil fuels and producing cement, according to the Netherlands Environmental Assessment Agency.

`First Mover Advantage'

The share sale will help fund Goldwind's plan to spend about 1.9 billion yuan to expand capacity and on research and development, according to a Dec. 6 share sale document.

``As China's wind power sector takes off, we think Goldwind is well-positioned to become a major beneficiary, thanks to its strong brand and first-mover advantage,'' KGI Securities analyst Steven Liao wrote in a Dec. 12 report. ``We think Goldwind is an attractive investment target,'' Taipei-based Liao said. Goldwind has a 33 percent share of China's wind-power equipment market, according to KGI.

China became the world's sixth-largest wind power generator last year, with 2,604 megawatts of installed capacity, according to KGI. Capacity is forecast increase by 54 percent in the five years ending 2010, the fastest pace in the world.

A megawatt of wind power generating capacity produces about as much electricity as 225 to 300 U.S. households use in a year, according to the American Wind Energy Association.

Three Gorges

China may have installed wind power generation capacity of 120 gigawatts by 2020, given state backing for such projects, Greenpeace's Yang said.

``The power generated from the wind generation units will be the equivalent of five Three Gorges projects,'' Yang said. The Three Gorges Dam, on China's Yangtze River, is the world's largest hydropower venture, with planned capacity of 18,200 megawatts.

The project, in the central province of Hubei, can generate 84.7 million megawatt-hours of power annually, equal to 10 nuclear reactors, and is due for completion in 2009.

Liao estimates Goldwind's 2007 sales at 3.2 billion yuan and 7.2 billion yuan in 2008.

Vestas Wind Systems A/S, based in Randers, Denmark, is the world's largest maker of wind-powered turbines and forecasts sales of 3.85 billion euros ($5.67 billion) this year.

Suzlon's Sales

India's Suzlon Energy Ltd., which aims to be the world's third-largest wind power company by 2010, may have sales of $3.31 billion in the 12 months ending March 2008, according to the average estimate of 14 analysts surveyed by Bloomberg.

China wants renewable energy make up 10 percent of its total energy consumption by 2010 and 15 percent by 2020 from about 8 percent now. China will spend 1.5 trillion yuan by 2020 to develop renewable energy sources including solar, wind and biomass.

China's investment on renewable energy will reach $20 billion this year, Xie Zhenhua, vice chairman of the National Development and Reform Commission, said yesterday at the UN conference in Bali.

Environment ministers from more than 180 countries are meeting in Bali to discuss an agreement to succeed the emissions-limiting Kyoto Protocol that expires in 2012.


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Goldwind IPO article on Bloomberg.com; windpower stock news