General Interface Solution Holding Ltd (GIS, 業成), a touchpanel manufacturing arm of Hon Hai Precision Industry Co (鴻海精密), should see its revenue rise by as much as 40 percent this year, after Sharp Corp clinched a bigger order allocation from Apple Inc, KGI Securities Co (凱基證券) said.
Sharp is leveraging Hon Hai’s partnership with Apple after Hon Hai acquired a 66 percent stake in the Japanese firm for US$3.5 billion last year. Hon Hai is a major supplier of iPads and iPhones to Apple.
With Samsung Electronics cutting supply, Sharp is expected to fill between 30 and 40 percent of Apple’s LCD panel needs for the iPad this year, up from between 15 and 25 percent last year, KGI analyst Kuo Ming-chi (郭明錤) said in a client note on Thursday.
Moreover, Sharp will, for the first time, start supplying flat panels for Apple’s MacBook laptops, Kuo said in the report.
The Japanese panelmaker is expected to start shipments in the third quarter and deliver 2 million to 3 million units for the whole year, accounting for 15 to 20 percent of the total panels used in MacBooks, he said.
“GIS, which assembles display modules for Sharp, will be the biggest beneficiary of this development,” Kuo said.
GIS could see its revenue soar by between 25 and 40 percent this year to between NT$100 billion and NT$110 (US$3.2 billion and US$3.5 million), Kuo said.
KGI’s forecast was much higher than an estimate of NT$90 billion by most analysts. For example, Daiwa Capital Markets Inc analyst Kylie Huang (黃奎毓) expects GIS to make NT$83.5 billion in revenue this year on the back of rising orders and better average selling prices (ASP).
Kuo said he also expects GIS to start shipping 3D touch modules for OLED panels for iPhones in March.
The new 3D touch module carries a higher ASP, he said.
In addition, GIS has the chance to supply OLED modules to Sharp and therefore to Apple next year, if the US company launches mid-end iPhones equipped with less advanced OLED screens as it did before, Kuo said.
“As a result, we are bullish about GIS’ stock performance,” Kuo said.
Last year, the Miaoli-based GIS made NT$79.36 billion in revenue. The company generated about 30 to 40 percent of its revenue from touchpanels used in smartphones.
GIS shares surged 4.95 percent to NT$97.6 in Taipei trading yesterday, hitting their highest level in nine months.
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