Merry Electronics Co (美律) yesterday led a fall in share prices for local handset component vendors in early Taipei trading after Nokia, the world’s No. 1 handset maker, overnight reported worse-than-expected third-quarter losses.
At the end of the session, however, most major players in the local handset supply chain recouped most of their early declines by heeding Nokia’s improving guidance for its product portfolio in the fourth quarter.
Shares of Merry Electronics, a maker of phone receivers and microphones, fell 2.07 percent to NT$52, while Silitech Technology Corp (閎暉), the world’s fourth-biggest maker of mobile-phone keypads, dropped 0.97 percent to NT$91.5 on the Taiwan Stock Exchange.
Shares of Largan Precision Co (大立光), the nation’s leading maker of camera phone lenses, were unchanged at NT$400 at the close of trading, after dropping 1 percent at the opening.
Keypad maker Ichia Technology Inc (毅嘉科技) managed to stay in positive territory, edging up 0.54 percent to NT$18.6.
In comparison, the benchmark TAIEX rose 0.06 percent.
Despite a disappointing third-quarter performance, Nokia predicts shipments of global mobile phones will continue to rise in the fourth quarter from the third quarter, and expects its market share to stay put in the fourth quarter compared with the previous quarter, the company’s press release said.
Overall, shipments of global handsets are likely to drop 7 percent to approximately 1.12 billion units this year from 1.21 billion units last year, Nokia said.
This is better than the Espoo, Finland-based company’s previous estimate of a decline of roughly 10 percent in global shipments year-on-year.
Moreover, the company said its new smartphone models scheduled to hit the market ahead of the holiday season would help boost its margins in the fourth quarter.
“This is positive for Taiwan’s supply chain in the fourth quarter,” Daiwa Securities SMBC-Cathay (大和國泰證券) analyst Andrew Chang said in a note yesterday.
The brokerage said Nokia’s continuing ramp-up of camera modules, keypads and headsets could provide upside momentum to Merry Electronics, Largan Precision and Silitech Technology for this quarter.
Citigroup Global Markets analyst Kevin Chang (張凱偉), however, said the local handset supply chain would face continuing challenges in the fourth quarter because Nokia’s 7 percent growth in fourth-quarter shipments was below its seasonal pattern of a quarterly 10 percent to 15 percent rise during the October-December quarter.
The Citigroup analyst wrote in a note yesterday that he was cautious regarding Nokia’s smartphone market outlook, given the extremely strong momentum of Apple iPhones.
As such, he expects further market share loss in this segment of the high-end market, after its share fell to 35 percent in the third quarter from 41 percent in the second quarter.
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