China’s top ten photovoltaic makers have accumulated a combined debt of 17.5 billion U.S. dollars so far, leading the whole industry to the brink of bankruptcy, data from U.S. investment agency Maxim Group showed.

LDK Solar, the world’s second-largest maker of solar wafers, and Suntech Power, the world’s largest solar panels producer, are the mostly likely to be headed for bankruptcy, Maxim noted.

LDK reported a net profit loss of 1.08 billion yuan in the first half of this year, with a total liability of 26.7 billion yuan, about 88 percent of its total assets. 2.42 billion yuan of debts will come due in 2013, compared with a cash pile of only 830 million yuan.

With its debt-to-equity ratio at 7.4, the Jiangxi-based LDK has already been in insolvency based on corporate accounting standards in the Europe and the United States, according to Maxim. A bankruptcy filing or restructuring could be needed for LDK, it added.

The state of Suntech, meanwhile, has also called into question the company’s ability to maintain operations. “The possibility of debt burdens bankrupting the company” has become a risk that deserves investors’ continuous attention, the company said in its first-quarter report, which showed a gross margin of 0.6 percent and a total debt of 3.58 billion U.S. dollars.

Based on preliminary results of domestically traded photovoltaic companies for the first half, nearly 80 percent have slashed their earning forecasts while the top ten brands, listed overseas, posted a loss of 612 million U.S. dollars in the first three months this year.

Yingli Green Energy Holding Co., another leading solar power company in China, said over the weekend that the company cut its delivery growth forecast of photovoltaic modules from 15 percent to 13-14 percent for the second quarter, and gross margin from previous 4.5-4.9 percent to around 4.5 percent for the period.

“A gross margin of 4.5 percent indicates a loss, for sure, in the second quarter,” said Meng Xiangan, vice chairman of the Chinese Renewable Energy Institute.

According to Meng, gross margins for China’s ten leading photovoltaic makers were all below 10 percent in the first quarter, led by Canadian Solar, who earned a gross margin of 7.7 percent but still reported a loss of around 20 million U.S. dollars.

What’s worse, cash flows in Chinese solar makers are even tighter as many have rolled their debts over to 120 to 180 days, according to investment firm Helix Investment Management.

Losses on the exchange rate as the euro weakened against the dollars add to the pain. Canadian Solar, Yingli and Trina Solar have reportedly embraced exchange losses of 8 million, about 30 million and 22-23 million U.S. dollars, respectively.