Fri, Nov 02, 2007 - Page 11 News List

Solar-cell company stocks boosted by high oil prices

SUNNY DAYS On average, solar shares increased 0.39 percent yesterday, outperforming a 0.78-percent drop in the over-the-counter GRETAI Securities Market index


Shares in solar cell makers soared yesterday after oil prices continued breaking records on global markets in the wake of the latest industry figures showing a surprise fall in US crude reserves.

Shares of Motech Industries Inc (茂迪), the nation's largest solar-cell manufacturer, edged up 5.59 percent to NT$359, while those of rival E-ton Solar Tech Co (益通光能) advanced 1.75 percent to NT$378.5 on the GRETAI Securities Market.

US light crude rose as high as US$96.24 in trading yesterday morning in Asia before falling back to US$96.05.

On average, solar shares grew 0.39 percent yesterday, outperforming a 0.78 percent decline in the over-the-counter GRETAI Securities Market index and a 1.17 percent drop in the benchmark TAIEX index.

The TAIEX yesterday tumbled 113.14 points to 9,598.23 as investors worried that "higher costs could eventually choke economic growth," SinoPac Securities Co (永豐金證券) analyst Vincent Chen said in a note.

Shares of Motech also gained support from the release of sales figures for last month.

The company yesterday posted record sales of NT$1.44 billion (US$44.4 million) for last month, up 55 percent from a year ago and a 2 percent increase from September.

For the first 10 months, the company's revenues jumped 111.2 percent year-on-year to NT$12.55 billion, the company's figures showed.

Last week, Motech disappointed investors as it reported that its gross margin had fallen to 17.5 percent in the third quarter -- from 18.5 percent in the second quarter and more than 20 percent in the first quarter -- owing to rising raw materials prices caused by a persistent shortage.

Motech president Simon Tsuo (左元淮) told investors at the time that he expected the gross margin to rebound in this quarter, after Swiss Wafer AG started supplying raw materials to the company last month.

Rival E-ton also saw its third-quarter gross margin edge down to 13.63 percent, the lowest since the company started trading its shares on the GRETAI Securities Market in March last year.

E-ton said its fourth-quarter margin would improve after it began to get silicon wafer supplies from Adema Technologies last month.

E-ton had acquired Adema Technologies, a US-based manufacturer of solar power parts, in June.

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