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How Diversified Is Trina Solar’s Customer Base?

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Global presence

Trina Solar (TSL) sells its PV (photovoltaic) modules primarily to power plant developers and operators, distributors, wholesalers, and PV system integrators. Apart from selling its products to third-party developers, the company also generates revenue from the sale of solar (TAN) modules from its Manufacturing segment and through its Solar Power Project segment from projects across geographies.

The company has a strong global distribution network covering Europe, Asia, North America, Australia, and Africa. It had over 20 production and sales centers around the world in May 2016, but the company’s production centers are mainly confined to Asia.

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Major customers

According to the company’s latest annual filings, major customers in fiscal 2015 included NVT, SunEdison (SUNEQ), Sanshin Electronics, Solar City (SCTY), SunEnergy1, FLS Energy, Welspun Energy Private Limited, Vivint Solar (VSLR), Bluefield SIF Investments Limited, Consolidated Edison Development, and TBEA Xinjiang Sunoasis.

In fiscal 2015, Trina Solar’s top five customers collectively accounted for 23.3% of its total sales, which is a decline from 34.7% in fiscal 2014. The company’s largest customer accounted for about 5.9% of its net sales in fiscal 2015.

Revenue diversification

Trina Solar derives the majority of its revenues from operations in China, Europe, the United States, and Japan. In 2015, the US accounted for 34.7% of total revenues, followed by China and Japan. Over the past three years, the revenue contribution operations in the US more than doubled, from 17.0% in 2013 to 34.7% in 2015. But the revenue contribution from Europe witnessed a major decline. In 2015, the growth of revenue contribution from company’s operations in India outpaced other regions on a year-over-year basis.

The extension of investment tax credits for investments in solar energy will be a key for revenue growth of upstream solar companies like Trina Solar, Canadian Solar (CSIQ), First Solar (FSLR), and SunPower (SPWR) in the United States.

In the next part of this series, we’ll look at various tax credits, incentives, and rebates available for owning eligible solar products in the US.

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