A convertible bond can only end in two ways: it becomes shares, or it gets repaid at maturity. Longi Green Energy Technology Co.,Ltd. (601012.SH) and its Long 22 Convertible Bond are now tilting toward the second path: a 7 billion yuan issue that has triggered its conditional put option for the very first time since listing, while the company has pressed "no downward revision" four times in a row — which, to bondholders, looks like the company has refused to take the route of lowering the conversion price.
This bond was issued in January 2022, when Longi Green Energy Technology Co.,Ltd. was the most valuable company in the A-share solar sector with a market cap of roughly 441 billion yuan, and the conversion price was set at 82.65 yuan. The issuance was hugely popular: existing shareholders subscribed in full for 62.1% of the allocation, online applications reached 11.29 million households, and the winning allotment rate was just 0.024%. Yet as the share price declined, the conversion price was cut sharply once, in March 2025, slashing about 70% from 58.28 yuan down to 17.5 yuan — only to be pierced by the share price again in less than a year. By October 21, 2026, the company had a total market cap of 83.283 billion yuan and the stock closed at 10.99 yuan.
Longi has not given investors a chance to convert: it would rather pay real money in the future than accept a lower conversion price in exchange for the possibility of conversion. No conversion means repayment. The bond matures in January 2028, and at a redemption price of 107 yuan per bond, the company would need to pay out roughly 7.484 billion yuan. Behind that 7 billion yuan lies a trade-off — a contest between the company and its bondholders.
7 Billion Yuan Bond Triggers Put Option, Company Rejects Revision Four Times
The Long 22 Convertible Bond was issued on January 5, 2022, in the amount of 7 billion yuan, with a six-year term maturing on January 4, 2028. The conversion price was 82.65 yuan at issuance and was adjusted several times over the following years due to dividends and stock splits, falling to 58.28 yuan before March 2025.
There was only one genuine downward revision. From January 21 to February 18, 2025, the share price closed below 85% of the prevailing conversion price — that is, below 49.54 yuan — for 15 trading days, triggering the clause; on March 7 of that year, an extraordinary shareholders' meeting approved the proposal. The revised price had a floor: under the prospectus, it could not be lower than the higher of the average price of 16.49 yuan over the 20 trading days before the shareholders' meeting and the average price of 17.1 yuan on the prior trading day. A March 8 announcement said the conversion price would drop from 58.28 yuan per share to 17.5 yuan per share — a one-time cut of 70%.
What has now been triggered is the conditional put clause: the stock's closing price falls below 70% of the prevailing conversion price (17.5 yuan), or below 12.25 yuan, for 30 consecutive trading days. This clause only takes effect in the final two interest-bearing years of the bond's life, and the Long 22 Convertible Bond only entered its fifth interest-bearing year on January 5, 2026 — more than four years after listing, the put clause has become effective for the first time. The put application period runs from October 27 to November 2. The trigger in July 2025 was a supplementary put. The company redirected 1.08 billion yuan of raised funds from a Wuhu module project to a Tongchuan cell project, which under the agreement required giving debtholders a put opportunity. That earlier trigger stemmed from a change in use of funds, and the company paid out a total of 4,024 yuan — unlike this share-price-driven trigger.
Bondholders currently face three prices: first, tendering to the company now under the put option at 101.29 yuan per bond (face value plus the fifth-year coupon); second, holding until maturity in January 2028 at 107 yuan per bond (107% of face value); third, selling in the secondary market at 112.74 yuan per bond (the October 21 close). Longi Green Energy Technology Co.,Ltd. stated in its announcement that as of now the closing price of the Long 22 Convertible Bond is higher than the put price, and holders who choose to tender may incur losses. A put is essentially selling something worth 112.74 yuan for 101.29 yuan, so holders will clearly not choose that — if cash is needed, selling in the secondary market is far more worthwhile than tendering to Longi.
Converting the debt into shares is also a dead end. The Long 22 Convertible Bond has long entered its conversion period, but the underlying share price has never reached the conversion price, and converting would mean a loss. As of October 8, the unconverted ratio was 99.92%, with only 12,000 yuan — 685 shares — converted in the third quarter. The market's pricing of this bond leaves almost no room for "becoming shares"; what buyers hold is a AAA-rated bond.
Compared with the put option, the company's stance on downward revision is more telling. A downward revision means lowering the price at which the bond converts into shares to make conversion worthwhile. The trigger line is a closing price below 85% of the prevailing conversion price on at least 15 of 30 consecutive trading days — with a conversion price of 17.5 yuan, that line is 14.88 yuan. Over the past year and a half, the company has issued five trigger notices and four announcements declining to revise. The September 22 announcement said it would not revise even if the clause were triggered again between that day and October 21. The company would rather let the put clause take effect than lower the conversion price.
The cost of a downward revision is dilution of existing shareholders. At the end of June 2026, the company had about 46.579 billion yuan of usable funds. Redeeming at 107 yuan per bond at maturity in January 2028 would require about 7.484 billion yuan, or 16% of usable cash. If it can pay, there is no need to swap equity for debt, since conversion would dilute shareholding.
Debt Pressure Is Modest, but Cash Is Thinning
Longi Green Energy Technology Co.,Ltd. has three bonds outstanding in the public market, with a combined issuance amount of 9.4 billion yuan, of which convertible bonds account for more than 70%. Besides the Long 22 Convertible Bond, the other two were both issued in the fourth quarter of 2025 as dual-labeled "science and technology innovation corporate bonds" and "green corporate bonds," both with five-year terms and, at the end of year three, an issuer coupon adjustment option and an investor put option. The two bonds come from the same registration approval: the securities regulator agreed to let Longi publicly issue up to 4.8 billion yuan of corporate bonds in installments, with a first tranche of 1.48 billion yuan and a second of 920 million yuan, leaving about 2.4 billion yuan of quota unused.
According to the prospectus, after deducting issuance expenses, the funds are used for project construction, replacing self-owned funds already invested in projects, and repaying project loans. Under the prospectus arrangement, all of the money points to the first phase of the 12.5GW-per-year high-efficiency BC cell project of Longi Leye Photovoltaic Technology (Xixian New Area), with 1.571 billion yuan for project construction and 429 million yuan to replace self-owned funds already invested in the project in the 12 months before issuance; total project investment is 3.206 billion yuan, with bond funds planned to account for 62.38%. Capacity is funded first and financed later, and issuing bonds puts the money that was fronted back on the books — this is the direct reason for "borrowing even with cash on hand."
A tracking rating report issued by Lianhe Credit Rating on June 26, 2026 maintained Longi Green Energy Technology Co.,Ltd.'s long-term issuer credit rating at AAA and the Long 22 Convertible Bond's credit rating at AAA, with a stable outlook. At the end of June 2026, the company had total liabilities of 97.411 billion yuan and an asset-liability ratio of 66.06%, with nearly half of that not requiring interest payments. Overall, the debt scale is not large among manufacturing companies of similar size. Non-interest-bearing items totaled 43.415 billion yuan, or 45% of total liabilities; interest-bearing obligations were about 37.6 billion yuan, which monetary funds of 48.627 billion yuan on the books could cover — even counting notes payable under the rating agency's definition, interest-bearing debt remains around 43 billion yuan. The Lianhe Credit Rating tracking report disclosed that the company had 65.728 billion yuan of remaining domestic and overseas bank credit lines. There is no short-term repayment pressure.
The pressure comes from the direction of cash flow. In the first half of 2026, net cash flow from operating activities was -5.818 billion yuan, compared with -484 million yuan a year earlier; the company attributed this to higher operating spending such as purchases of raw materials and fewer tax refunds received. Over the same period, net cash flow from investing activities was an outflow of 1.334 billion yuan, while net cash flow from financing activities was an inflow of 906 million yuan. Monetary funds fell from 55.473 billion yuan at the start of the year to 48.627 billion yuan at the end of June, down 6.846 billion yuan in half a year. Where the money goes also deserves attention: on one side, capacity construction and channel expansion keep consuming cash; on the other, the industry price war squeezes collections, pulling cash from both ends.
Worth noting is an off-balance-sheet item: as of the end of September, the company and its subsidiaries had cumulative guarantees of 26.623 billion yuan, equal to 49.05% of the latest audited net assets attributable to the parent — nearly half of the family silver pledged outside in the form of guarantees, with no overdue amounts, mostly for subsidiaries with relatively high debt ratios. This does not appear on the liability side of the consolidated statements, but if trouble really arises, someone will have to pay.
Industry Oversupply, Two and a Half Years of Losses
Longi Green Energy Technology Co.,Ltd. is the world's largest monocrystalline silicon photovoltaic manufacturer. Its interim report states that cumulative monocrystalline wafer shipments have ranked first globally for nearly a decade, and photovoltaic module shipments have held a global top-two position for five consecutive years. In the first half of 2026, the industry was still in a period of deep adjustment. Data from the National Energy Administration showed China added 72.07GW of photovoltaic capacity, down 66% year on year; global new installations fell for the first time in nearly two decades. Demand shrank while capacity did not, and the price war spread from polysilicon all the way to modules.
Against that backdrop, Longi Green Energy Technology Co.,Ltd.'s revenue kept sliding, from 129.498 billion yuan in 2023 to 70.347 billion yuan in 2025, and to 27.045 billion yuan in the first half of 2026, down 17.58% year on year. It has posted losses since 2024, with net profit attributable to the parent at -3.684 billion yuan in the first half of 2026, a wider loss than a year earlier.
Where do the losses come from? Shipments of wafers and modules are among the world's highest, but first-half revenue of 27.045 billion yuan against operating costs of 26.683 billion yuan left gross profit of only 360 million yuan — after direct costs, selling products leaves almost nothing. Gross margins were 18.26%, 7.44% and 0.81% in 2023-2025, a steep decline, and rose to 1.34% in this year's first half, still low.
The second layer lies in costs and expenses. The interim report lists four points: insufficient utilization rates and persistently low gross margins; high silver prices in the first quarter pushing up costs, with some centralized orders already loss-making at delivery; investment losses from associates of 495 million yuan; and foreign exchange losses from the appreciation of the renminbi, which turned financial expenses from -409 million yuan a year earlier into 1.033 billion yuan.
The price war began in the polysilicon segment. Data from the Silicon Industry Branch on October 14 showed n-type recycled feedstock traded at 43,000 yuan per ton, still below the full cost of 45.3 yuan per kilogram estimated by Mysteel. When upstream polysilicon loses money on every ton sold, downstream wafers and modules cannot command good prices.
With losses piling up, the share price followed. On November 1, 2021, Longi hit an intraday high of 103.3 yuan (73.03 yuan adjusted), with a closing market cap of 542.38 billion yuan. It closed at 10.99 yuan on October 21, 2026, with a market cap of 83.283 billion yuan — down about 85% and evaporating roughly 459 billion yuan. It is precisely because of the sustained share-price decline that the conversion price of Longi Green Energy Technology Co.,Ltd.'s 7 billion yuan convertible bond was sharply lowered.
During this share-price adjustment, the shareholder list also changed, with private equity giant Hillhouse Capital cutting the most. In December 2020, it acquired 226 million shares from shareholder Li Chun'an at 70 yuan per share for 15.841 billion yuan, equal to 6% of total share capital. Longi subsequently made two 4-for-10 stock dividends, raising the holding to 444 million shares, making the 70 yuan cost equivalent to 35.7 yuan today (before cash dividends). Its holdings began declining in 2023; in March of that year, HHLR, Hillhouse's secondary-market platform, lent out some shares through refinancing, cutting its stake to 5%; in November it received a case-filing notice from the securities regulator over suspected violation of restrictive rules on share transfers; in April 2024 it added 1.2813 million shares to return to 5% and promised to buy back the shares involved with self-raised funds, with gains going to the listed company.
The exit mainly happened in 2025. A reduction plan was announced on June 7, and by August 22 it had sold 37.5572 million shares through centralized bidding at prices of 14.88 yuan to 16.62 yuan, cashing out 584 million yuan and pushing its stake below 5%, after which further reductions no longer required advance disclosure. It cut another 146 million shares in the fourth quarter, and Hillhouse no longer appears among the top ten shareholders from the first-quarter 2026 report onward.
Longi Green Energy Technology Co.,Ltd. still has two businesses that are growing. One is overseas. In the first half, overseas module sales rose more than 26% year on year, with overseas revenue share rising above 65%; the Americas grew more than 36%, Europe more than 34%, and Asia-Pacific more than 20%. The other is BC, or Back Contact cell technology. In the first half, BC module sales reached 19.55GW, up 125% year on year, accounting for more than 65% of module shipments, with domestic centralized procurement wins exceeding 10GW. But these two did not offset the domestic decline; the main reason first-half revenue fell was lower sales of modules, wafers and other products.
On one side are 46.5 billion yuan of cash on the books; on the other are consecutive losses and a share price down 85% from its peak. Facing the 7 billion yuan convertible bond, Longi Green Energy Technology Co.,Ltd. has already given its answer to the question of "revise or not revise." Whether earnings can recover, whether the share price can rebound, and whether this bond ultimately ends in a cash repayment all deserve continued attention.
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