Chinese home appliance manufacturers are ratcheting up efforts to make forays into the photovoltaic sector in a bid to seek new sources of revenue and diversify their business layouts amid sluggish growth in the country's household appliance market, industry insiders said.

Highlighting that leading home appliance companies have advantages in manufacturing, operations, brand awareness and retail channels when they march into the PV industry, experts said they are still confronted with challenges given that large amounts of capital are needed in the initial stage and it will take several years to see investments pay off.

Li Dongsheng, founder and chairman of Chinese consumer electronics maker TCL Technology Group Corp, said the company will focus on three core business segments — intelligent terminals, semiconductor displays and new energy photovoltaics. It is conducting further research and discussions regarding PV business in overseas markets.

In 2020, TCL acquired Zhonghuan Electronics Information Group, which is mainly engaged in the R&D and production of PV and semiconductor silicon wafers for 11 billion yuan ($1.53 billion), in order to expand its footprint in the upstream semiconductor display industrial chain and generate synergies with its display business.

TCL Zhonghuan Renewable Energy Technology, a subsidiary of TCL and one of the leading solar silicon wafer producers in China, recorded 67.01 billion yuan in revenue last year, an increase of 63.02 percent year-on-year, while its net profit rose 69.21 percent year-on-year to 6.82 billion yuan.

The company announced in February that it will build a new PV wafer plant and related supporting facilities in Yinchuan, capital of Ningxia Hui autonomous region, with a total investment of 12 billion yuan. Its annual production capacity of single-crystal silicon reached 140 gigawatts last year and will likely rise to 180 GW by the end of 2023, TCL Zhonghuan said.

Skyworth PV Tech, the photovoltaic unit of television manufacturer Skyworth Group, reported that its revenue reached 11.93 billion yuan last year, an increase of 191 percent compared with the previous year.

Skyworth's PV business has covered more than 10 provinces nationwide, such as Shandong, Hebei and Henan. In 2022, more than 140,000 PV power stations were connected to the grid and began generating power.

Skyworth PV Tech said it will continue to develop its distributed PV business, bolster technological innovation and provide customized household photovoltaic products to accommodate various room types and user demand to promote the green and sustainable development of the PV industry.

Data from Beijing-based market consultancy All View Cloud, or AVC, show that the revenue of China's home appliance sector totaled 708.1 billion yuan in 2022, down 7.4 percent year-on-year.

"China's home appliance market is almost saturated while the demand for renewable energy, especially PV power generation, continues to grow around the world, which presents immense opportunities for household appliance companies," said Zhao Meimei, assistant president of AVC.

The government has unveiled a series of favorable policies, such as financial subsidies and tax incentives, to facilitate the development of the PV industry, a move that aligns with the country's dual carbon goals, Zhao noted.

"Home appliance makers have some advantages in manufacturing, scientific research, marketing and the whole industrial chain, which will help them gain a foothold in the PV sector," Zhao said. However, it may take a long time before huge investments in the emerging industry yield the expected results, she added.

China's new PV installations reached a record 87.41 GW in 2022, up 59.3 percent year-on-year, data from the National Energy Administration showed. The country is expected to see its new PV installations amount to a range of between 95 and 120 GW this year, said the China Photovoltaic Industry Association.

In addition, Hiconics Eco-energy Technology Co Ltd, a subsidiary of Chinese home appliance maker Midea Group, announced in late June that it expects to raise about 1.47 billion yuan from Midea. The capital will mainly be used for upgrading electrical equipment and boosting its reach in the PV segment. Midea will become the controlling shareholder of Hiconics following the deal.

Founded in 2003, Hiconics is engaged in the research and development and production and sales of industrial frequency converters. Midea acquired an 18.73 percent stake in Hiconics in 2020.

Liang Zhenpeng, an independent consumer electronics analyst, said most Chinese home appliance makers have entered the PV sector through investments and strategic cooperation, with their layouts mainly concentrated in the distributed PV where the entry threshold is relatively low, adding that the fast-developing PV industry will be one of the key growth drivers for home appliance companies.