Shares in Taiwanese solar wafer maker Sino-American Silicon Products Inc (SAS, 中美晶) surged during trading on Friday, closing limit-up after the company announced a share buyback plan aimed at increasing earnings per share for shareholders, and in turn boosting share prices.
Other solar power firms also saw their shares jump on Friday amid improved sentiment over their earnings outlook due to escalating trade disputes between China and Western countries as well as high hopes for Washington’s commitment to renewable energy after US President Barack Obama’s re-election.
Shares in SAS rose by the 7 percent daily limit closing at NT$34.15, with 11.72 million shares changing hands. Larger rival Green Energy Technology Inc (綠能) and solar cell and module maker DelSolar Co (旺能) also ended limit-up at NT$18.15 and NT$11.20 respectively.
SAS announced on Thursday that it planned to buy back 10 million common shares (1.91 percent of total outstanding shares), according to a stock exchange filing.
The Hsinchu-based company said it planned to spend up to NT$15.4 billion (US$528.3 million) on its first-ever buyback plan, and that it would transfer the repurchased shares to its employees. The firm said it would repurchase shares on the open market at between NT$30 and NT$50 a share until Jan. 8.
On Friday, SAS posted 84.09 percent annual growth in consolidated revenue for last month to NT$1.62 billion, following rebounding demand, 16.4 percent lower than the NT$1.94 billion in September, according to a stock exchange filing.
For the first 10 months of the year, revenue totaled NT$15.53 billion, down 3.74 percent year-on-year. In the first three quarters, losses were NT$1.06 billion, NT$2.27 per share, the filing showed.
Other solar stocks also rose on Friday on hopes that trade disputes between China, the US and the EU will trigger more Chinese orders, with Gintech Energy Corp (昱晶) up 6.43 percent to NT$25.65 and Motech Industries Inc (茂迪) up 4.52 percent to NT$26.6, compared with the TAIEX’s 0.70 percent rise.
Neo Solar Power Corp (新日光) also climbed 3.12 percent to NT$16.5 while Solartech Energy Corp (昇陽) rose 2.35 percent to NT$17.4.
Hopes were raised after the US International Trade Commission last week issued a final decision to impose anti-dumping tariffs of up to 250 percent on solar-energy products from China over the next five years to protect US producers.
However, analysts advised investors from overloading on solar shares too soon, as oversupply problems could still affect profitability.
“It seems that these firms have enjoyed an increase in orders after the US authorities issued a preliminary decision on the trade disputes earlier this year,” Horizon Securities Co (宏遠證券) analyst Benson Huang (黃重善) said, referring to last month’s double digit sales growth reported by some firms.
However, the global solar business remained hindered by supply gluts, which have led to fierce competition, in particular from Chinese suppliers who account for up to 70 percent of production, Huang said.
“Therefore, the current gains are simply technical in nature after a recent slump,” he said.
Fubon Securities Co (富邦證券) analyst Patty Sung (宋佩璇) said the recent recovery in the solar industry was not as strong as that seen earlier in the year, when many Taiwanese companies obtained rush orders from Europe.
“The market is still watching closely for the final results of the EU’s anti-dumping and anti-subsidizing probe against Chinese companies, which means upstream firms [like solar cell and wafer suppliers] have yet to see strong ‘pull in’ orders [from downstream manufacturers and vendors],” Sung said in a note on Friday.
“Moreover, Taiwanese makers do not stand a better chance of bargaining for higher prices under the current weak demand conditions,” Sung added.
According to EnergyTrend, a market research team at Taipei-based TrendForce Corp (集邦科技), it is unlikely that oversupply issues will be solved until 2016.
Additional reporting by CNA
WASHINGTON’S INCENTIVES: The CHIPS Act set aside US$39 billion in direct grants to persuade the world’s top semiconductor companies to make chips on US soil The US plans to award more than US$6 billion to Samsung Electronics Co, helping the chipmaker expand beyond a project in Texas it has already announced, people familiar with the matter said. The money from the 2022 CHIPS and Science Act would be one of several major awards that the US Department of Commerce is expected to announce in the coming weeks, including a grant of more than US$5 billion to Samsung’s rival, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), people familiar with the plans said. The people spoke on condition of anonymity in advance of the official announcements. The federal funding for
HIGH DEMAND: The firm has strong capabilities of providing key components including liquid cooling technology needed for AI servers, chairman Young Liu said Hon Hai Precision Industry Co (鴻海精密) yesterday revised its revenue outlook for this year to “significant” growth from a “neutral” view forecast five months ago, due to strong demand for artificial intelligence (AI) servers from cloud service providers. Hon Hai, a major assembler of iPhones that is also known as Foxconn, expects AI server revenues to soar more than 40 percent annually this year, chairman Young Liu (劉揚偉) told investors. The robust growth would uplift revenue contribution from AI servers to 40 percent of the company’s overall server revenue this year, from 30 percent last year, Liu said. In the three-year period
LONG HAUL: Largan Energy Materials’ TNO-based lithium-ion batteries are expected to charge in five minutes and last about 20 years, far surpassing conventional technology Largan Precision Co (大立光) has formed a joint venture with the Industrial Technology Research Institute (ITRI, 工研院) to produce fast-charging, long-life lithium-ion batteries for electric vehicles, mobile electronics and electric storage units, the camera lens supplier for Apple Inc’s iPhones said yesterday. Largan Energy Materials Co (萬溢能源材料), established in January, is developing high-energy, fast-charging, long-life lithium-ion batteries using titanium niobium oxide (TNO) anodes, it said. TNO-based batteries can be fully charged in five minutes and have a lifespan of 20 years, a major advantage over the two to four hours of charging time needed for conventional graphite-anode-based batteries, Largan said in a
Taiwan is one of the first countries to benefit from the artificial intelligence (AI) boom, but because that is largely down to a single company it also represents a risk, former Google Taiwan managing director Chien Lee-feng (簡立峰) said at an AI forum in Taipei yesterday. Speaking at the forum on how generative AI can generate possibilities for all walks of life, Chien said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) — currently among the world’s 10 most-valuable companies due to continued optimism about AI — ensures Taiwan is one of the economies to benefit most from AI. “This is because AI is