Wistron approves third factory in India

BENGALURU PLAN::A filing with the Taiwan Stock Exchange said that a subsidiary would invest 1.48 billion rupees to fund medical and service business operations

By Chen Cheng-hui  /  Staff reporter

Mon, Nov 19, 2018 - Page 16

Wistron Corp’s (緯創) board of directors on Thursday approved a plan to construct the contract electronics manufacturer’s third factory in India, which is to focus on healthcare business as chief executive officer Robert Huang (黃柏漙) embraces diversification amid fierce competition.

The company announced the acquisition of real-estate in India on behalf of Wistron Infocomm Manufacturing (India) Pvt Ltd to build a plant on rented land, after its board green-lit the plan.

Wistron said in a regulatory filing with the Taiwan Stock Exchange that the company’s wholly owned subsidiary plans to invest 1.48 billion rupees (US$20.62 million) “to fulfill the operational needs for medical and service businesses.”

Huang on June 14 told investors that the company’s India strategy was to collaborate with local brands by using Wistron’s production management and software development capabilities to create cloud computing, smart manufacturing and healthcare solutions that suit the Indian market best.

The company has two plants in Bengaluru that make iPhones for Apple Inc and the new plant is also in the Indian city.

Wistron, which also has production facilities in Taiwan, China, Malaysia, the Czech Republic, Mexico and the US, also manufactures tablets, notebook computers, PCs, servers, LCD monitors and TVs on a contract basis.

Wistron on Nov. 9 reported financial results that were better than expected for the July-to-September quarter on better revenue scale and stringent operational expense control. Net income increased 35.14 percent annually to NT$1.24 billion (US$40.1 million), with earnings per share (EPS) of NT$0.44, while consolidated revenue rose 7.27 percent to NT$227.65 billion.

Gross margin rose 0.18 percentage points to 4.11 percent from a year earlier, while operating margin increased 0.44 percentage points to 1.23 percent.

“Key growth drivers in the quarter include a pickup in notebook and iPhone shipments, as well as in the liquid crystal module business, while the momentum from white-box data centers and servers remained stable compared with the second quarter,” Citigroup Global Markets Inc analyst Carrie Liu (劉瓊芳) said in a client note.

In the first three quarters of the year, Wistron’s cumulative net income rose 22.44 percent annually to NT$2.79 billion, with EPS of NT$1.

Consolidated revenue in the first 10 months totaled NT$725.81 billion, up 9.31 percent from the same period last year, company data showed.

“Looking into 2019, we believe Wistron is set to grow from a low base of iPhone shipments this year, while its server business could continue to benefit from the positive structural trend of data traffic growth,” Liu said.