Guinness Sustainable Energy Fund on Canadian Solar
Thesis
The fund owns Canadian Solar for integrated exposure to the standard polysilicon solar-cell and module manufacturing process. The long-term thesis is supported by continued growth in global solar installations and the expectation that renewables will account for a large majority of future power additions. In August the company still posted strong sales, but gross margins disappointed because module pricing remained under pressure from industry oversupply, highlighting a key cyclical risk within the thesis.
“Canadian Solar and First Solar give integrated exposure to the solar cell and module manufacturing process”
Key risks
- Industry oversupply can pressure module pricing and gross margins
- Tariff and trade-policy changes can raise costs or alter market access