225 replies to this topic

[kknd1234]

Transcript is out.

http://seekingalpha....pt?source=yahoo

[odyd]

Explo, what is your outlook on value chain components? CSIQ claimed to have 55 cts blended for China manufacturing. TSL today say they had 53 cts. I think that is not a huge difference for now provided that their focus is a bit more different (CSIQ more downstream oriented), but also depending on how pricing for cells and wafer will further evolve. CSIQ is clearly more vulnerable right now. I would expect that over time CSIQ is in some disadvantage at this point when demand increases and cells and wafer capacity in the market becomes tighter. On the other hand we have seen cell and wafer pricing coming down a lot in Q2 according to pvinsights. What do you think?

 

I am not fully familiar with the size of the fire damage but, in order to increase cell cost by one cent across the value chain, you would have to have a rather large amount of lines impacted. The real concern here is wafer. I think being at around $0.53 to $0.54 would be their normal level.
I am also curious about level of inventory for both, TSL and CSIQ. Is it possible they bought wafer/poly stocks to safeguard them from the price increase in Q2?  This is a substantial amount of inventory.  I do not think JA had the same situation. Is it because the parent carrying on wafer inventory for them?

[explo]

One thing to consider for CSIQ is that they account for warranty in COGS while industry standard is to record it in opex. So their cogs is expected to be a bit (around 0.5 to 1 cent) higher than peers for that reason.

On inventory build up forTSL and CSIQ I think the simple reason is that they shipped less in Q1 than they do in the other quaters of the year, so they kept producing at max level to be able to ship above capacity in 2H.

[odyd]

That would be the simple reason. Since they are recorded at cogs value with talking a lot of inventory with 7 days of Febraury being off. Sounds too much.

[explo]

At least I hope they did not hoard raw material in Q1 as poly, wafer and cell pricing peaked there.

[odyd]

Yeah, that would be a bit wrong on their part.