Shares in the nation's top chipmaker for flat panels Novatek Microelectronics Corp (
American depositary shares of Himax Technologies regained 3.4 percent, or US$0.30, to close at US$9.05 on their second trading day after losing 2.8 percent in its first day of trading on the tech-heavy NASDAQ stock market last Friday.
Himax and its shareholders last week sold 52 million American depository shares at US$9 apiece, completing the biggest technology IPO in Asia this year. Each American depository share represents one ordinary share.
"We had expected Himax' IPO to boost the stock price of its bigger rival Novatek at home as Himax is traded at a higher valuation than Novatek," said Rex Liu (
Liu said that foreign investors would be willing to pay more for stocks with promising outlooks on the US stock markets than on the Taiwanese bourses, which in turn would help those companies raise more funds from selling shares.
That would be a major factor for most local firms such as Himax who are considering listing on the US stock markets, he added.
"Disappointingly, Himax's IPO did not have a positive impact on Novatek," Liu said.
Novatek shares have fallen 2.8 percent in the past two days to end at NT$224 (US$6.9) on the Taiwan Stock Exchange yesterday, ending a four straight gain ahead of Himax's IPO.
Liu, however, said "the price correction will be short-lived as the prospects for Novatek are bright. Novatek will enjoy decent growth in sales from robust demand for liquid-crystal-display (LCD) TVs this year."
Merrill Lynch analyst Jonah Cheng (程正樺) gave a "buy" rating to Novatek, citing strong demand for LCD-TVs. Cheng upgraded by 30 percent the target price for the stock to NT$260 from his previous NT$200 in mid-February.
Cheng also raised his earnings forecast for Novatek this year to NT$16.4 per share from the NT$15.4 estimated earlier.
Himax, which designs chips mostly for slim screens used in computers and TVs, posted net income of US$61.6 million, up 71 percent from a year ago, according to the company's prospectus.
The company owns about 16 percent of the global market in drivers for TFT-LCD panel displays, according to data published at the investors.com Web site. More than 96 percent of sales last year were in this area, it said.
Chi Mei Optoelectronics Corp (奇美電子), the nation's No. 2 maker of flat panels, is Himax's largest customer, providing almost 60 percent of sales. In addition, Chi Mei is also one of the company's largest shareholders, according to investors.com. Following the IPO, Chi Mei owns 12.75 percent in Himax, down from its previous 13.6 percent.
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