Shares of memory chipmaker Winbond Electronics Corp (華邦電子) yesterday plunged 7 percent, as profit-taking selling pressure outweighed the company’s disclosure of a detailed construction plan for a NT$335 billion (US$11.09 billion) new plant in a bid to solve capacity constraints.
The world’s No. 3 NOR flash memorychip supplier said it plans to start construction on an advanced 12-inch chip factory in Kaohsiung in July next year at the earliest.
That would pave the way for the plant’s mass production of 20-nanometer or 25-nanometer niche DRAM chips and flash memory chips in 2020, it said.
The company also plans to eventually produce next-generation 14-nanometer chips at the plant, Winbond said.
“Winbond needs to build a new plant to satisfy customers’ growing demand, driven by the Internet of Things and artificial intelligence technologies,” company chairman Arthur Chiao (焦佑鈞) said in a company statement released on Monday.
The plant is to create 2,500 high-ranking jobs in Kaohsiung upon the completion of the investment program over the next 15 years, Chiao said.
The Hsinchu-based chipmaker has not invested in any new factory since 2004 amid see-sawing oversupply and demand.
To boost capacity, Winbond said it also plans to spend a record-high NT$17 billion this year primarily on new equipment.
The budget is to help the chipmaker boost its capacity from 44,000 to 48,000 wafers a month during the quarter that ends on Dec. 31.
Winbond in July told investors that ongoing short supply of NOR flash memory chips is to extend into the remainder of this year.
NOR flash memory chips are the biggest revenue contributor to Winbond, accounting for 45 percent of the company’s last quarter revenue of NT$8.94 billion.
Winbond said its revenue has been capped by insufficient capacity last quarter, as it only posted 8.36 percent quarter-on-quarter growth.
The company will not see significant improvement in the second half of this year as its DRAM capacity will only increase slightly from a technology upgrade, it said.
Winbond shares tumbled 7.02 percent to NT$25.15 yesterday. Since the beginning of the year, Winbond shares have rallied 150 percent, outperforming the broader TAIEX, which rose 10.61 percent yesterday.
Local memory chipmakers Nanya Technology Corp (南亞科技) and Marconi International Co (旺宏) also felt the pinch of selling pressure with their shares falling 4.17 percent and 2.66 percent to NT$80.5 and NT$45.8 respectively.
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