On November 30, Jinko Solar (688223) announced updates regarding the fire incident at its wholly-owned subsidiary, Shanxi Jinko Solar No.2 Intelligent Manufacturing Co., Ltd. ("Shanxi Jinko"), which occurred on April 26, 2024. The accident damaged certain equipment and assets, and the company had already accounted for the corresponding losses in its 2024 annual report.

Shanxi Jinko signed a "Second Advance Payment Agreement" with its insurer and recently received an advance payout of 200 million yuan. As of the announcement date, the cumulative advance payout reached 220 million yuan, marking the first substantial insurance compensation since the fire.

Regarding the 56-billion-yuan Shanxi production base—a key focus for investors—Jinko Solar remained cautious in its statements. The company clarified that these advance payouts would positively impact its 2025 performance but emphasized that this does not imply the insurer has acknowledged liability. Final liability determination will depend on relevant laws and the accident investigation report.

The Shanxi mega-facility, with a total investment of approximately 56 billion yuan (including working capital), is being constructed in four phases. It integrates 56GW monocrystalline rod pulling, 56GW silicon wafer, 56GW high-efficiency cell, and 56GW module production—making it the world's first "super-integrated" solar factory covering wafers, cells, and modules. As a flagship project for Shanxi's energy transition and industrial upgrade, it achieved rapid progress from negotiation to production within a year.

In June, Jinko Solar disclosed that it had received an inquiry letter from regulators regarding its 2024 annual report, addressing eight areas including overseas operations, the Shanxi fire incident, and capital reserves. In its response, the company stated that the wafer and cell workshop under Phase 1 was still under construction during the fire and thus not subject to statutory safety management responsibilities under China’s Work Safety Law. Currently, Phase 1 crystal pulling and module workshops are operational, while the wafer and cell workshop is under reconstruction, with Shanxi Jinko’s operations proceeding normally.

For the first three quarters of 2025, Jinko Solar reported total revenue of 47.986 billion yuan and a net loss of 3.92 billion yuan attributable to shareholders, marking a 33.14% year-on-year revenue decline and a shift to losses. However, Q3 showed signs of recovery, with the net loss narrowing by 33% compared to Q2. Operating cash flow improved significantly from -3.812 billion yuan in H1 to -1.341 billion yuan, reflecting a quarterly improvement of 2.471 billion yuan.

While the 220 million yuan advance payout may ease cash flow pressure, its impact is likely limited. For Jinko Solar to navigate the industry cycle successfully, fundamental improvements in its core business—such as faster reconstruction of the wafer and cell workshop, sustained product efficiency leadership, and progress in energy storage shipments—will be critical drivers amid the ongoing solar industry reshuffle.