Yesterday Dr. DeLuca did a fine job at the Merriman Curhan Ford Investor Conference. DSTI closed down at $2.66 per share. Per the CEO, everything is on target at DayStar. If there was any glitch, he mentioned that the initial product that roles off the production line in the 1st quarter will have to go through various certifications. The expectation was to be fully certified somewhere in the 3rd quarter and to be in full production mode at that point.
Dr. DeLuca talked largely about the complexity of manufacturing CIGS solar cells. CIGS involves using a combination of copper, indium, gallium and selenide to produce a thin film solar photovoltaic product. This process sets DayStar apart from most other solar photovoltaic producers in that they are using silicon for their manufacturing of solar panels. And among the CIGS producers out there, DayStar stands alone because of their proprietary manufacturing process they developed over the last few years.
Much of the discussion at the conference focused on direct competitors in the CIGS field. There were two other producers that were mentioned specifically, Global Solar and Nanosolar. Both of these are privately held companies. DayStar stands out again because the other major CIGS players are private firms.
Another topic of the conference was pushing into the CIGS technology further than other firms have, building a competitive method of production and enhancing the existing technology. DayStar has produced a large prototype the company dubbed "Big Baby" in order to determine what challenges would arise by enlarging the production size of their CIGS technology.
Dr. DeLuca pointed out several key points for the company going forward, with an emphasis on two of them. First, keeping the production cost of the CIGS panels as low as possible. Second, to maintain (or enhance) the already superior effiency of their product. Low cost and high efficiency were the two major issues at hand and both have hit their milestones as laid out by DayStar.
There were many specifics mentioned as well. More discussion was focused as to the complexity of the manufacturing process and the potential difficulties that can appear as the scale of production increases. One goal that was stated involved using the thin film CIGS to get to a pricing level that did not need any government subsidy. The assumption is that at some point the subisidies from government sources will dry up and that the higher cost producers will not be in a profitable situation at that point. Dr. DeLuca also reminded everyone on the call that DayStar has essentially pre-sold all of their pending products for the next three years to two large German solar companies. The revenue stream will be there as long as the product comes off the assembly in working order.
Another intersting concept was that of intellectual property. DayStar has developed their own CIGS technology, using low cost materials and even lower cost base products. A question came up regarding acquiring patents for the final product that will be sold. The CEO stated that DayStar would initiate patent requests, but probably not pursue them. Rather, he talked about successfully filing for and attaining patents on the specific manufacturing process that DayStar will be using. This was where the company could truly own the product, by holding the patents on how they produce their CIGS product. Sounds like a smart idea.
Overall it was a good call. No bad news and no surprises. Everything is moving ahead with determination. DayStar is focused on scalability, efficiency and low costs. The new production facility is starting to receive the equipment they will need to begin manufacturing by no later than March 2009. DayStar is positioned to be a leader in CIGS production within a year. DSTI traded down yesterday, but the whole market was in a down draft. Today, DSTI has traded down again. It's just after noon EST, and the stock is down -$.22, trading at $2.44 per share. Given the good (stable) news from yesterday and the solid long-term prospects for this firm, DSTI has to be considered for any investor in the solar arena.
