Largan Precision Co (大立光), a leading smartphone camera lens supplier, on Friday said that it had bought back 672,000 of its own shares over the past two months, or 0.5 percent of its outstanding shares, for NT$1.4 billion (US$50.47 million).
The number of repurchased shares accounted for half of the shares that the company had planned to acquire on the open market to bolster its share price.
Largan shares on Friday closed 0.61 percent lower at NT$2,445 in Taipei trading, having dropped 23.47 percent since the beginning of this year due to weak revenue performance and a fall in profitability.
Photo: David Chang, EPA-EFE
During the buyback period, its stock price rose 21.33 percent, Taiwan Stock Exchange data showed.
On Oct. 26, Largan began to execute the company’s first buyback scheme, aiming to repurchase up to 1.342 million shares — or 1 percent of its outstanding shares — at NT$2,025 to NT$3,300 per share.
Largan said in a regulatory filing on Friday that the average repurchase price was NT$2,084, which is the highest for a listed company in Taiwan.
Last week, the stock rallied 7.71 percent after two foreign brokerage firms raised their target price for Largan shares to NT$2,600 and NT$2,990 respectively, on expectations that the Apple Inc supplier would benefit from an industry trend of adopting more high-end lenses per smartphone, as well as rising demand for automotive optical components next year.
As a leading maker of optical lens modules, Largan also produces real-image viewfinders and other optoelectronic parts.
Largan signed a long-term agreement with a top Chinese smartphone brand, TF International Securities Group Co (天風國際證券) analyst Kuo Ming-chi (郭明錤) said in a report on Monday, adding that orders to the Chinese client are expected to increase shipments 20 percent annually, compared with a previous forecast of shipments falling 15 to 20 percent.
Upgrades to iPhone cameras over the next two years would boost Largan’s market share, revenue and profit, Kuo said, without providing further details
Largan posted net profit of NT$13.54 billion in the first three quarters of this year, down 23 percent annually, with earnings per share of NT$100.91.
The firm’s cumulative revenue for the first 11 months dropped 16.79 percent year-on-year to NT$42.46 billion, company data showed.
Separately, the Taichung-based company on Friday gained approval to invest NT$34.2 billion in a plant expansion at the Taichung Industrial Park (臺中工業區) under the government’s “Invest in Taiwan” initiative, the InvesTaiwan Service Center said in a statement.
Largan has since last year started construction of the plants and installed smart machinery at the industrial park, the center said, adding that the investment is expected to create 2,500 jobs.
The company has pledged to continue to expand application services for smart handheld devices and focus on high-end production technology in Taiwan, the center added.
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