Agoracom Blog Small-Cap Company Feature: Solarfun Power Holdings

Posted by AGORACOM at 9:33 AM on Wednesday, May 26th, 2010

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As many of you know, we are very bullish on the long-term future of Chinese small cap and mid cap companies for two reasons:

1] The obvious reason – China is the fastest growing economy on the planet and nothing is going to slow down its ascent over the next 50 years and beyond. Investing in growth companies there just makes too much sense.

2] Great Results and Valuations – Many Small Cap Chinese Companies are listing in the US (OTCBB, NYSE Alternext and NASDAQ) with great financial results. Unlike many dubious US Small Cap Companies, Chinese Companies don’t seem to believe in losing money or failing to execute in a business plan. As such, 7-digit revenues and profits are very common.

From a valuation point of view, many Chinese companies became a victim of their own success in Q4 2008 and Q1 2009. Why? When the world needed to start liquidating, one of the first places they looked were China where most investors had significant gains to sell into. This resulted in the proverbial baby being thrown out with the bathwater and some great valuations.


Solarfun Power Holdings (Nasdaq:SOLF)


Solarfun manufactures both PV cells and PV modules, provides PV cell processing services to convert silicon wafers into PV cells, and supplies solar system integration services in China. Solarfun produces both monocrystalline and multicrystalline silicon cells and modules. Solarfun sells its products both through third-party distributors, OEM manufacturers and directly to system integrators.

On May 26th,  2010,  Solarfun reported its unaudited financial results for the quarter ended December 31, 2009.

Check out the full details below!

Read Full Press Release

China Stocks TV Segment


  • Total net revenues were US$216.2 million in 1Q10, an increase of 17.8% from 4Q09 and an increase of 115.7% from 1Q09.
  • PV module shipments, including module processing services, reached 150.6 MW, an increase from 110.8 MW in 4Q09 and from 35.7 MW in 1Q09.
  • Average selling price, excluding module processing services, declined, as expected, to US$1.76 per watt in 1Q10.
  • Gross profit was US$39.9 million and gross margin was 18.5%.
  • Net income attributable to shareholders on a non-GAAP basis(1) was US$23.2 million, an increase of 64.9% from 4Q09
  • Net income per diluted ADS on a non-GAAP basis was US$ 0.40, an increase of 63.9% from RMB 1.66 in 4Q09
  • Annualized ROE on a non-GAAP basis significantly improved to 26.6 % in 1Q10 from 17.4% in 4Q09 and 2.3% in 1Q09.
  • As of March 31, 2010, the Company had cash and cash equivalents of US$137.2 million and working capital of US$289.8 million.


We’ve provided investors with two great starting points to research great Chinese small cap and mid cap companies.

1. – tracks 250 of the best small cap and mid cap companies trading on North American exchanges. It provides you with the best of the best in two ways. First, the front page lists the best news of the day coming out of the space. It does so by giving you a text view of the best press releases by industry and via Chinese Stocks TV, a 5-minute broadcast every morning just after the open. Chinese Stocks TV is archived, so you can catch up on shows you missed.

Second, if you want to research each of the 250 companies to find candidates for your portfolio, it has a very intuitive directory that lets you quickly review each company on the master list, or parse it out by industry and exchange if you have a particular sector of interest. Cool stuff.

2. Right here on AGORACOM, you can refer to our China category for other featured Chinese Small-Cap Companies. As always, we will disclose any IR relationship with any public company. Given the sheer number of great Chinese Small-Cap Companies out there, you can expect us NOT to have an IR relationship with most of these companies.


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