Nanya Technology Corp (南亞科技), the nation’s biggest PC memory chipmaker, expects chip prices to rebound this month on the back of faster-than-expected improvement in demand, bolstering the company’s expectations of explosive growth in the second half, company executives said yesterday.
Company president Jih Lien (連日昌) expected demand to rebound next quarter, helped by accelerating corporate PC replacement following the sales of Microsoft Corp’s Windows 7 system.
“Overall, we think market demand will be quite good this year,” Lien told reporters over a media luncheon yesterday. “But we will be very cautious about capacity expansion. We have no plans to build a new plant this year.”
The Taoyuan-based chipmaker said it was in talks with customers to hike prices slightly this month, as customers were building up inventory ahead of expected massive PC replacement in the second half, company spokesman Pai Pei-lin (白培霖) said during an annual luncheon with reporters.
PREMATURE
The price hike comes one month earlier than previously planned, as the company said in January that prices might bounce back in the second quarter.
“I originally thought [demand] would have slowed down in the first and second quarters, but customers are placing orders [more aggressively] in fear of shortages in the second half,” Pai said.
“Supply is still tight now,” Pai said.
Nanya Technology yesterday posted 12 percent lower sales for last month at NT$4.14 billion (US$129 million), compared to NT$4.72 billion in January, as output fell more than 10 percent because of the Lunar New Year holidays, according to a company statement.
REVERSAL
In other news, Minister of Economic Affairs Shih Yen-hsiang (施顏祥) yesterday said the government has decided not to inject any capital into Taiwan Memory Co (TMC, 台灣記憶體公司), which was planned by the ministry last year as part of a broader plan to revamp the nation’s shaky memory sector.
This virtually means the failure of the government’s efforts last year as the ministry had originally planned to use TMC as a platform to consolidate local PC memory chipmakers’ capacity and as a source of new technology.
The company “has to raise funds on its own,” Shih said.
His comments came after legislators blocked the Ministry of Economic Affair’s plan to inject NT$8 billion into TMC via the National Development Fund.
The ministry yesterday held a meeting with representatives from local computer memory chipmakers, chip testers, packagers and chip designers to discuss new measures to counter the next downturn.
Shih said the government is seeking to help local companies enhance their competitiveness to compete with South Korean rivals like Samsung Electronics Co.
The general plan is for the government to help local companies seek strategic partnerships with overseas electronic makers and the government may consider forming a new platform to help them raise funds for technological migration, Shih said.
Representatives from Nanya, Inotera Memories Inc (華亞科技), Powerchip Semiconductor Corp (力晶半導體), Rexchip Electronics Inc (瑞晶半導體), TMC and other chip companies attended the meeting.
The share price of Nanya Technology fell 1.52 percent to NT$25.9 yesterday.
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