Epistar Corp (晶元光電), the nation’s biggest LED chipmaker, is likely to resume its growth momentum in the first quarter of next year in view of rising component restocking in China and South Korea after experiencing weakening demand and falling prices this quarter, Primasia Securities Co (犇亞證券) said yesterday.
“We forecast the company’s sales to grow by 25 percent to 30 percent year-on-year in 2011,” Primasia said in a client note yesterday.
Average selling prices (ASPs) for LEDs are forecast to face rising pressure after the expanding installation of new metalorganic chemical vapor deposition (MOCVD) equipment by companies next year, as well as a parity between supply and demand in the LED sector, Primasia said.
On average, MOCVD equipment can supply about 380,000 units of LCD TV backlights a year, JPMorgan said in an investment report on Nov. 24.
As the ASP may drop by a range of between 10 percent and 15 percent next year, Epistar is likely to expand its sales of high ASP margin TV and lighting LEDs by between 55 percent to 60 percent next year, from about 40 percent to 45 percent this year, to offset the downward pricing trend, Primasia said in the note.
Rider Chang (張世賢), Epistar’s vice president of finance and accounting, told reporters on Dec. 3 that the LED lighting business accounts for about 20 percent of its sales and LED backlighting makes up 50 percent.
JPMorgan said last month that Epistar is in the process of shifting its focus from TV backlights to lighting applications and is undertaking a fast product mix change in order to sustain its earnings growth.
Primasia yesterday maintained a long-term positive stance on Epistar and suggested investors load up on the company’s shares whenever pulling back occurs, after the Hsinchu-based company announced plans to issue US$280 million of zero-interest overseas convertible bonds over next two years to expand investment in a Chinese joint venture.
In a stock exchange filing on Thursday, Epistar said it would invest an additional US$19.5 million in United LED Shan Dong Corp (冠銓山東光電), a joint venture established in China with United Microelectronics Corp (聯電).
Following the expanded investment, Epistar’s investment in the Chinese joint venture will total US$27.5 million, with its stakeholding increasing to 55 percent from 50 percent, the filing said.
Shares of Epistar edged down 0.97 percent to NT$102 yesterday on the Taiwan Stock Exchange. So far this year, the stock has dropped 15 percent, underperforming the TAIEX’s 8.22 percent rise over the same period, the stock exchange’s data showed.
When Lika Megreladze was a child, life in her native western Georgian region of Guria revolved around tea. Her mother worked for decades as a scientist at the Soviet Union’s Institute of Tea and Subtropical Crops in the village of Anaseuli, Georgia, perfecting cultivation methods for a Georgian tea industry that supplied the bulk of the vast communist state’s brews. “When I was a child, this was only my mum’s workplace. Only later I realized that it was something big,” she said. Now, the institute lies abandoned. Yellowed papers are strewn around its decaying corridors, and a statue of Soviet founder Vladimir Lenin
UNCERTAINTIES: Exports surged 34.1% and private investment grew 7.03% to outpace expectations in the first half, although US tariffs could stall momentum The Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) yesterday raised its GDP growth forecast to 3.05 percent this year on a robust first-half performance, but warned that US tariff threats and external uncertainty could stall momentum in the second half of the year. “The first half proved exceptionally strong, allowing room for optimism,” CIER president Lien Hsien-ming (連賢明) said. “But the growth momentum may slow moving forward due to US tariffs.” The tariff threat poses definite downside risks, although the scale of the impact remains unclear given the unpredictability of US President Donald Trump’s policies, Lien said. Despite the headwinds, Taiwan is likely
UNIFYING OPPOSITION: Numerous companies have registered complaints over the potential levies, bringing together rival automakers in voicing their reservations US President Donald Trump is readying plans for industry-specific tariffs to kick in alongside his country-by-country duties in two weeks, ramping up his push to reshape the US’ standing in the global trading system by penalizing purchases from abroad. Administration officials could release details of Trump’s planned 50 percent duty on copper in the days before they are set to take effect on Friday next week, a person familiar with the matter said. That is the same date Trump’s “reciprocal” levies on products from more than 100 nations are slated to begin. Trump on Tuesday said that he is likely to impose tariffs
HELPING HAND: Approving the sale of H20s could give China the edge it needs to capture market share and become the global standard, a US representative said The US President Donald Trump administration’s decision allowing Nvidia Corp to resume shipments of its H20 artificial intelligence (AI) chips to China risks bolstering Beijing’s military capabilities and expanding its capacity to compete with the US, the head of the US House Select Committee on Strategic Competition Between the United States and the Chinese Communist Party said. “The H20, which is a cost-effective and powerful AI inference chip, far surpasses China’s indigenous capability and would therefore provide a substantial increase to China’s AI development,” committee chairman John Moolenaar, a Michigan Republican, said on Friday in a letter to US Secretary of
RSS