Thread by @McBejezzus

Canadian Solar IPO🧵

So Canadian Solar $CSIQ is going to raise RMB 6 billion ($850 million) by selling 15% of CSI Solar.

investors.canadiansolar.com/news-releases/…

2/6

First off, market cap / valuation:

CSI Solar is probably about 80% of $CSIQ total business (other 20% is Recurrent Energy).

So Chinese market values Canadian Solar as approx $7bn company.

But what will the money be used for?

3/6

$CSIQ has already announced plan to build polysilicon plant.

By my modest calculations, 80,000MT of polysilicon capacity - at cost price of $10/kg - can save Canadian Solar anywhere from $400m to over $1bn per year.

Should be massive for the bottom line.

4/6

What if market cap of subsidiary remains untethered / way above $CSIQ market cap on NASDAQ?

Unlike other ADRs with subsidiaries, Canadian Solar is actually a registered company in Canada. It would not be unthinkable for $CSIQ to liquidate stake in CSI Solar:

5/6

Assuming a market cap for CSI Solar somewhere in the $6-8 billion range, $CSIQ 60% stake will have $3.6-4.8 billion value.

MORE THAN 2X CURRENT MARKET CAP.

And they would still have Recurrent Energy business after such a move.

Summary:

6/6
All in all, Canadian Solar $CSIQ remains one of the most massively undervalued stocks on the market. But I expect that to change, and when it does, I expect it to change fast. 🚀🚀🚀

GLTA! 🍻

#Solar
#Megatrend
#LCOE
#Bullish
#LFG

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