"MGMT. said that average production cost between the two
plants would be $20-$25 probably closer to $20."
I listened to the entire call and never heard that. In any case, it's mathematically impossible. their existing plant is around $29/kg on average. New plant at $20. Do the math.
I listened to the entire call. Yes, their target is $20/kg in the new plant. Problem is that the new plant will produce less than 50% of their poly. I wish they could move their old plant to the new site as well, where electricity is at 50% of that of the existing plant.
I believe Whacker said they are sold out for years. GCL-Poly says they are sold out for 2012 and DQ said they are 50% sold out for 2012..I heard that myself near the end of the conference call. This isn't an oversupply situation at all.
The subject was raised a couple of times.
MGMT. said that average production cost between the two
plants would be $20-$25 probably closer to $20.
I found it interesting, that, Europe is currently their largest
market. it appears that even in the current oversupply, they anticipate
China to consume all they can produce.
DQ has gotten some unfair/bad breaks that have really damaged the chart. I remember their first earnings report where everybody thought they missed because they reported earnings based on ordinairy shares and not per ADS...this caused tremendous chart damage that was never reversed. Then analysts all claimed the 4th qtr of 2010 was going to bad..it wasn't they had it all wrong...more chart damage. Then analysts said it would be the first quarter....then the second quarter. Then oil prices started dropping like a rock right about the time the 6 month lock-up period ended. Bad timing. Then on top of that bad timing on Italy's wrangling over FIT which took months to resolve and then more crap out of Europe and their debt, a U.S. downgrade on debt, a weakening U.S. economy and now appears to be a very weak European economies. Now there is tons of overhead supply and people in general stay away because it's "dead" money until there is a major reversal. Everybody wants to wait and see how low it will go, let it base before buying no matter how cheap, except for maybe cash per share value. Charts rule markets today and fundamentals are largely ignored until there is a major reversal or buyout or some kind of really import buzz to turn this aircraft carrier around. DQ has brand new plant and equipment worth $500M. Their market cap is a couple hundred million. Makes no sense at all, but like I said, in the short term nobody feels like they are about to miss the boat and needs to be the first ones to step up to the plate. Get some Merger and Acquisition activity going in the Chinese Solars and we have something to turn this around. That will light a fire under people and then they will be afraid that they just may miss the boat. Earnings along aren't going to do it. More debt for capacity expansion doesn't help the balance sheet, which they just announced. DQ has so much CAPEX going on that they do not have positive free cash flow yet. Yes they have great earnings but they are holding cash reserves and borrowing.