Gintech Energy Corp (昱晶能源), the nation’s second-biggest solar cell maker, plans to almost double its production capacity in two years to tap global demand for renewable energy.
The company will spend US$170 million to increase annual capacity to 1 gigawatt in 2011, from the current 560 megawatts, chairman Wenent Pan (潘文炎) said in an interview.
Gintech may sell shares or convertible bonds overseas to fund its expansion, he said.
One megawatt can supply about 800 US homes.
Gintech expects its shipments of devices that turn sunlight into electricity to rise more than 70 percent next year as governments step up spending on technologies such as solar and wind power to curb emissions of greenhouse gases.
The company plans to secure contracts as it competes for orders with Motech Industries Inc (茂迪) and Sharp Corp.
“The market is quite upbeat next year,” said Min Li (李敏), a Hong Kong-based analyst at Yuanta Securities Co (元大證券), who has a “hold” rating on the stock. “Global demand for solar panels may rise 50 percent as prices are attractive.”
The demand for solar cells is expected to increase at least 30 percent next year, and capacity expansion will enable Gintech to benefit from economies of scale, Pan said on Wednesday.
“When the production scale is big, costs will be low and the company’s brand will be appreciated,” Pan said.
The Miaoli-based company’s shipments may exceed 600 megawatts next year, up from an estimated 350 megawatts this year and 179 megawatts last year, Pan said.
Gintech, which raised NT$2.76 billion (US$86 million) in a share sale last month, has risen 36 percent in Taipei trading this year, lagging behind the benchmark index’s 67 percent gain as the worst global recession since the Great Depression and a glut of solar equipment caused prices to slump.
Solar module prices fell by 50 percent this year to between US$1.80 and US$2 a watt, Li said.
Prices of solar cells may drop less than 10 percent next year, Pan said.
Renewable-energy investment may climb to a record of about US$200 billion worldwide next year, New Energy Finance said.
Gintech posted a net loss of NT$1.03 billion in the nine months of this year, compared with a profit of NT$1.8 billion a year earlier, the company’s exchange filing said.
Gintech said on Nov. 23 it had a profit of NT$391 million in October.
Motech is Taiwan’s biggest solar cell maker. The world’s largest include Japan’s Sharp and Q-Cell SE of Germany.
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