Wed, Oct 17, 2007 - Page 11 News List

Mediatek Inc stocks see heavy rally on relaxed regulations

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Mediatek Inc (聯發科技), the nation's biggest mobile-phone chip maker, rose the most in more than two months on the Taiwan Stock Exchange after a newspaper said the company will benefit from relaxed regulations in China.

The Hsinchu-based company's shares climbed 5.1 percent, the biggest increase since Aug. 8, to close at NT$603. The benchmark TAIEX gained 0.78 percent.

China lifted a requirement that all companies obtain a manufacturing license before making mobile phones in the nation, according to the Web site of the State Council. Mediatek may receive more orders for chips as an increasing number of companies produce handsets in the nation, the Chinese-language Economic Daily News said today.

"Terminating the manufacturing law will make it easier for smaller manufacturers to start making handsets," Kevin Wang, head of China research for ISuppli Corp, said by telephone.

Mediatek will raise sales to Chinese handset makers to 245 million mobile chips next year from 170 million this year, BNP Paribas analyst Eric Chen (陳慧明) wrote in a report today. Mediatek controls 80 percent of China's market for unbranded mobile-phone chips, he said.

Companies are still required to have a network access license from the China's Ministry of Information Industry for handsets before they can be sold in China, Wang said.

Revenue from mobile-phone chip sales in China will contribute "slightly more" than 60 percent to 70 percent of handset semiconductor sales in the fourth quarter, Mediatek chief financial officer Yu Ming-to (喻銘鐸) said in Hsinchu today by phone. He declined to elaborate.

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