warrenew

LDK Solar: Forecasting Sunny Skies in Q2 Earnings

Good work! I'm not Chinese, just speak Mandarin. I notice lots of differences in the analyst conferences between what is said in Chinese and how it is said in English. Chairman Miao of Yingli is my favorite -- when I can get through his accent. The subtle shadings simply do not come through in translation.

The ability quietly to visit a company site or office and sit there looking stupid and speaking English while reading and listening to the conversations in Chinese is also very useful. Walking around the town, visiting restaurants or locations near the compannies involved, and talking generally to employees also is helpful.

The other thing -- and it is major -- that the Western analysts miss is the attitude of the CCP and the Central Committee towards Chinese energy policy. They have the usual "The Mountains are High and the Emperor is Far Away" problems with the provincial officials, and they need (and will have) a central Energy Ministry later this year or early next year, but the commitment to alt-energy in China is tremendous and so are the funds available to support it.

There is awkwardness in some of the financial structures -- the inability to get financing for the Dunhuang solar PV project, yet, but the solar insolation in Xinjiang and the Gobi is very large, and the primary east/west power grid tie from Shanghai to the west runs just to the north of Dunhuang on its way to Urumchi and the border.

I like the analysts who follow the companies, and I listen to all of the conference calls, but few of them speak Chinese or read it, and almost no one actually goes to the company sites, offices, plants or walks around the towns where they do the manufacturing, or talks to their Chinese customers. In Chinese.

Great article. Glad you posted it and did the maths -- I never thought to read the local government handouts, but what you did feels right. Great work!