PV manufacturer Baoding Tianwei Baobian Electric has become the second Chinese company in a week to fall into difficulty after reporting two years of losses.

Only days after Chaori Solar became the first Chinese company to default on a domestic bond repayment, Baoding Tianwei was suspended from trading on the Shanghai Stock Exchange (SSE).

In an SSE filing, Baoding Tianwei reported a CNY5.23 billion yuan (US$852 million) loss in 2013, following on from a CNY1.55 billion loss the previous year.

Subsequently, in accordance with SSE rules, the company’s stocks and bonds were suspended from trading. A decision is due within seven working days on whether the suspension will remain in place until the company reverses its losses.

The news of first Chaori and now Baoding Tianwei has prompted speculation that China’s bloated solar industry could be on the point of significant deflation as other, heavily indebted state-owned companies miss debt repayments that had previously been assumed to be guaranteed by the state.

The Chinese government has already hinted at its intention to reduce support for the domestic PV industry by placing only 109 of a possible 500 companies on a list of firms eligible for take part in state-run tenders and support mechanisms.