@zhexiangxd best to just shadow sir @tapdance answer haha but will try to answer my own as to why silicon metal producer $PMBTECH / 7172 (PMB TECHNOLOGY BERHAD) might have a differing outcome to glovemakers when ASP normalise.
1) Access to cheap and clean source of power / energy.
- The main cost component in producing silicon metal is not quartz, it's energy / power. Samalaju, SESCO, Bakun dam provides clean source of energy (unlike China based peers having energy from coal plants) at competitive price, making PMBTECH one of the lowest cost quartile producer of silicon.
2) China was already the market leader.
- PMBTECH is a newcomer who's slowly taking market share. Unlike glovemakers - who came from position of market leadership losing market share due to change of supply dynamics from China, China is already the incumbent with 70% of market share in global silicon production. US or Europe players may come in, but again - coming back to point number (1), do they have access to ample clean energy in the short / medium term?
3) Management calibre.
- There's a certain "valuation premium" that can be given to those who's deemed as quality management in the context of local market. PMETAL has that prestige. Why not PMBTECH?
4) The Institutions are not yet in the game.
Looking at fund flows to PMBTECH, as well as reading PMETAL reports, the "smart" money is not yet in the know. Once they caught a glimpse (I suspect could be from Q4 or Q1 results) of PMBTECH from associate profit column in $PMETAL / 8869 (PRESS METAL ALUMINIUM HOLDINGS BERHAD), as well as the reduction of earnings multiples from good earning quarters, more enquiries and studies could be conducted, roadshows delivered and money to be poured in.
All in all, whilst there could be some volatility to earnings and share price due to ASP fluctuations over time, I think due to its low base, potential valuation adjustment, growth in volume production and the company's positioning vs global peers - we should not be seeing what happened to glove happen to PMBTECH.