A labor rights violation complaint in China is likely to have little impact on Catcher Technology Co (可成), Daiwa Capital Markets Co said last week.
Instead, the casing orders for the new iPhone that began shipping last month should be a key revenue driver for the company in the coming months, the brokerage said.
“So far we do not expect this incident to have any immediate impact on Catcher’s operation,” Daiwa analyst Steven Tseng (曾緒良) said in a client note on Friday last week, one day after Green America and China Labor Watch issued a joint report accusing the Greater Tainan-based company of several violations in a plant in Suqian, Jiangsu Province.
The two rights groups said Catcher had violated 22 Chinese labor laws through discriminatory hiring policies, incomplete training sessions, poor safety infrastructure and other inadequacies, as well as violating Catcher’s own policies and Apple’s Supplier Code of Conduct.
Apple Inc announced on Friday that it had sent a team to investigate the reported violations at the factory making aluminum enclosures for iPads and MacBooks.
Apple said its inspectors constantly audit its suppliers monthly, including Catcher’s Suqian facility. It said some of Catcher’s manufacturing processes “exceed international safety standards,” but it also noted some areas where improvement is needed, such as fire safety and excessive overtime.
Deutsche Bank also said that it did not expect the labor complaint to hurt Catcher, saying it is just “another regular report” from China Labor Watch focusing on Apple’s supply-chain firms.
“From the angle of human rights, we agree with China Labor Watch that manufacturing factories in China have room to improve, including Catcher,” Deutsche Bank analyst Birdy Lu (呂家霖) said in a separate note on Friday. “From the business fundamental view, this is a non-event.”
Shares of Catcher closed 1.5 percent lower at NT$303.5 in Taipei trading on Friday, compared with the broader market’s 0.22 percent decline. The local stock market was closed yesterday for the Mid-Autumn Festival.
Catcher on Friday reported NT$5.01 billion (US$166.99 million) in consolidated sales last month.
Tseng said the company’s combined sales for the past two months have reached 65 percent of Daiwa’s third-quarter sales forecast of NT$14.9 billion.
He said he expects the firm to remain on track to achieve its sales target for this quarter and next quarter, while retaining his “outperform” rating on Catcher’s shares with a price target of NT$315.
HSBC Securities Taiwan Corp Ltd said Catcher’s latest sales data confirmed its positive view and should further relieve market concerns over the company’s near-term outlook.
“On top of stable demand for commercial notebook and MacBook casings and a new model launch from Sony, iPhone 6 is another key driver,” HSBC Securities said in a note on Saturday. “We believe the ramp-up for iPhone 6 casings remained on track with yields at satisfactory levels.”
With iPhone 6 a key sales driver in the second half of the year, HSBC forecast Catcher’s third-quarter sales would grow by 16 percent quarter-on-quarter, followed by another 30 percent growth in the fourth quarter.
Japanese technology giant Softbank Group Corp said Tuesday it has sold its stake in Nvidia Corp, raising US$5.8 billion to pour into other investments. It also reported its profit nearly tripled in the first half of this fiscal year from a year earlier. Tokyo-based Softbank said it sold the stake in Silicon Vally-based Nvidia last month, a move that reflects its shift in focus to OpenAI, owner of the artificial intelligence (AI) chatbot ChatGPT. Softbank reported its profit in the April-to-September period soared to about 2.5 trillion yen (about US$13 billion). Its sales for the six month period rose 7.7 percent year-on-year
CRESTING WAVE: Companies are still buying in, but the shivers in the market could be the first signs that the AI wave has peaked and the collapse is upon the world Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported a new monthly record of NT$367.47 billion (US$11.85 billion) in consolidated sales for last month thanks to global demand for artificial intelligence (AI) applications. Last month’s figure represented 16.9 percent annual growth, the slowest pace since February last year. On a monthly basis, sales rose 11 percent. Cumulative sales in the first 10 months of the year grew 33.8 percent year-on-year to NT$3.13 trillion, a record for the same period in the company’s history. However, the slowing growth in monthly sales last month highlights uncertainty over the sustainability of the AI boom even as
AI BOOST: Next year, the cloud and networking product business is expected to remain a key revenue pillar for the company, Hon Hai chairman Young Liu said Manufacturing giant Hon Hai Precision Industry Co (鴻海精密) yesterday posted its best third-quarter profit in the company’s history, backed by strong demand for artificial intelligence (AI) servers. Net profit expanded 17 percent annually to NT$57.67 billion (US$1.86 billion) from NT$44.36 billion, the company said. On a quarterly basis, net profit soared 30 percent from NT$44.36 billion, it said. Hon Hai, which is Apple Inc’s primary iPhone assembler and makes servers powered by Nvidia Corp’s AI accelerators, said earnings per share expanded to NT$4.15 from NT$3.55 a year earlier and NT$3.19 in the second quarter. Gross margin improved to 6.35 percent,
BUST FEARS: While a KMT legislator asked if an AI bubble could affect Taiwan, the DGBAS minister said the sector appears on track to continue growing The local property market has cooled down moderately following a series of credit control measures designed to contain speculation, the central bank said yesterday, while remaining tight-lipped about potential rule relaxations. Lawmakers in a meeting of the legislature’s Finance Committee voiced concerns to central bank officials that the credit control measures have adversely affected the government’s tax income and small and medium-sized property developers, with limited positive effects. Housing prices have been climbing since 2016, even when the central bank imposed its first set of control measures in 2020, Chinese Nationalist Party (KMT) Legislator Lo Ting-wei (羅廷瑋) said. “Since the second half of
RSS