Shares of Chunghwa Picture Tubes Ltd (
The deal puts Chunghwa Picture in the same league as AU Optronics Corp (
Chunghwa Picture's stock gained 0.27 percent to NT$7.31 on the Taiwan Stock Exchange yesterday, underperforming the benchmark TAIEX index, which advanced 1.23 percent.
"We start supplying 32-inch TV panels to Samsung this month. We expect Samsung to be a major client of Chunghwa Picture in the TV panel area this quarter," said Ally Chen (
Chen declined to reveal the size of the order, but said Samsung had already purchased computer monitors from Chunghwa Picture, sales of which generated over 95 percent of the local company's revenues last quarter.
Chen said the company expected monthly output of TV panels would exceed 100,000 units this month.
Samsung is sourcing more panels outside its own factories in order to cope with growing demand for its TV sets around the globe.
In the three months to June, Samsung overtook Sharp Corp as the world's second largest LCD TV vendor with market share expanding to 13.1 percent, closely tracking Royal Philips Electronics NV's 13.5 percent share, according to the latest tally of market researcher DisplaySearch.
But an analyst offered a cold response to the Samsung news, saying the deal would do little for Chunghwa Picture's bottomline.
"The company may not be able to generate profit from selling panels to Samsung," said Eric Lin (
The cost was relatively higher than its rivals as the yield rate was low at
Chunghwa Picture's sixth-generation (6G) factory, where the company has just
begun manufacturing 32-inch panels for slim-screen TVs, Lin said.
Chunghwa Picture may expand its quarterly loss to NT$3.5 billion for the
last quarter from loss of NT$1.47 billion the first quarter, Lin projected.
The company is scheduled to release the second-quarter figures tomorrow.
According to DisplaySearch, sales of LCD TVs grew 28 percent to 9.4 million
sets in the April-June quarter from the first quarter as price fall spurred
demand. The researcher forecast the total sales of TV sets would increase to
42 million this year from around 8 million last year.