Tue, Feb 07, 2017 - Page 12 News List

Largan shares down in seasonal slump

Staff writer, with CNA

Largan Precision Co (大立光) shares fell yesterday morning, underperforming the market after the company reported a 30 percent month-on-month fall in sales for last month, dealers said.

However, the company’s sales last month still beat the figure recorded for the same period last year, indicating that Largan’s year-on-year growth momentum remains intact, which could help its share price bounce back after the current correction, dealers said.

Largan supplies smartphone camera lenses to Apple Inc.

Its weighted index on the Taiwan Stock Exchange rallied above 9,500 points following a rise on Wall Street over the weekend.

“The fall in Largan shares was just a hiccup. An uptrend in sales remains unchanged for this year as more international smartphone brands adopt dual lens cameras,” Ta Ching Securities (大慶證券) analyst Andy Hsu (許博傑) said.

“The month-on-month decline in Largan’s sales last month was in line with market expectations, because the month is traditionally slow,” Hsu said. “The year-on-year sales growth is evidence that the growth momentum is still there.”

In a statement released on Sunday, Largan posted NT$3.8 billion (US$122 million) in consolidated sales, down 30 percent from a month earlier, but an increase of 18 percent from the previous year.

According to Largan, high-end camera lenses, which command higher gross margins, still accounted for a majority of the company’s sales last month, with 10 megapixel (MP) lenses, or more advanced models, making up 70 percent to 80 percent of revenue, 8MP lenses 10 percent to 20 percent and 5MP lenses taking about 10 percent.

Dealers said that the month-on-month fall in Largan sales largely reflected the reduced number of working days over the six-day Lunar New Year holiday.

Largan chief executive officer Adam Lin (林恩平) said that production capacity was fully booked to meet demand from customers who requested tailored camera lenses, in particular dual lens designs.

Lin said that sales for this month are expected to grow year-on-year.

On the back of its efforts to develop high-tech models and improve product mix, Largan’s gross margin for the fourth quarter of last year hit a record high of 70.65 percent.

“Largan stock is a favorite of foreign institutional investors. As long as foreign investors continue to buy into the stock, an increase in its value could resume after the current fall,” Lin said.

Meanwhile, metal casing maker Catcher Technology Co (可成), also a supplier to Apple, said that consolidated sales for last month totaled NT$4.86 billion, down 36.3 percent from a month earlier and 22 percent from a year earlier.

This story has been viewed 2913 times.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top