[By gungbao2003, from yahoo finance msg board, ]
I did some research on these companies to see if LDK can match these companies in the coming years.
Here's what I found out.
1. MEMC actually only started selling Solar Grade Wafers in Jan 2007. This is written in their 2006 Annual Report. They mainly made semi-conductor wafers before. They are re-focusing their efforts on growing Polysilicon and Solar Wafer production capacity to meet the expected growth in demand from the Solar Industry.
- LDK started producing and shipping multi- crystalline wafers in 2nd qtr of 2006.
- LDK is focused on the solar industry not like MEMC which is doing a "renewal" to serve both semi-con and solar industries.
2.REC claims to be the biggest multi-crystalline wafer producer in the world. Their current capacity is 465 mw of combined multi and mono crystalline wafers. They used to make more mono crystalline wafers and have lately seen demand for multi-crystalline wafers growing. This made them expand capacity on multi-crystalline manufacturing in 2007.
- by end of 2007 their solar wafer capacity is at 465mw compared to 400mw for LDK. Not a big difference between the established veteran and LDK.
3. MEMC aims to increase Polysilicon production capacity to 8000 MT tons by end of 2008 and based on market conditions ramp up to 15,000 mt by end of 2010. LDK as we know plans to have 7000 mt tons poly capacity by end of 2008 and 15,000 mt by end of 2009. By 2009, LDK will have higher capacity than MEMC.
4. REC compared to MEMC has lower gross and net margins and have looked at recycling polysilicon as a means to reduce costs. LDK is already an expert in this recycling of polysilicon from scrap or from their production process by-products. REC by the way has a PE of 77, it is traded in the Oslo stock market. In terms of planned capacities, REC aims to have 13500mw of solar wafer capacity by end of 2010. LDK aims for 16000mw by end of 2009. REC sold a little over 400mw of solar wafers in 2007. LDK is set to sell close to 300mw of wafers in 2007. Clearly LDK is gaining quickly on REC in the multi-crystalline wafer market.
From 2006 to 2007, LDK has moved up quickly against these established players. From 2008 to 2009, it may overtake MEMC and REC.
