China Will Suspend The Approval Of IPO Financing For Renewable Energy Enterprises, The Foreign Minister Said.

China has ordered renewable energy related IPO for fear of overcapacity, Reuters reported today.

The report quoted sources as saying, "there is no such public document at present, but IPO like the industry with excess capacity such as crystalline silicon and wind power equipment has been suspended."

Recently, a related company's financing was approved by Jin Feng Technology in Hongkong for nearly HK $9 billion.

This year, the State Council issued a number of documents on suppressing overcapacity and duplication of construction, making clear that the six industries as steel, cement, flat glass, coal chemical industry, polysilicon and wind power equipment are the focus of regulation and guidance. At the same time, it lists the industries with more contradictions in capacity overproduction such as electrolytic aluminum, shipbuilding and soybean crushing, and hopes to arouse the attention of relevant departments and regions.

As a complementary policy, the financing of overcapacity industries has also been tightened.

The central bank said that when approving new credit projects and issuing bond financing, we must strictly implement the market access requirements of national industrial policies and environmental protection policies, and strictly examine the financing applications of enterprises with high energy consumption and high emissions.

Reuters reported that the ban by Chinese regulators undoubtedly threatens the financing channels for wind energy equipment manufacturers and polysilicon suppliers, and will also have an impact on the exit of private equity and Vc firm.