LCD Shares: More Gains Or Is The Boom Over?

Date: 7 July 2009
Source: Reuters
SEOUL (Reuters) - Leading LCD makers have jumped in the last few months on stronger-than-expected consumer demand for flat-screen TVs, outperforming gains in the electronics sector.

The display industry is recovering from one of its worst downturns as billions of dollars from China's stimulus package and resilient North American markets help boost demand for televisions and computers. South Korea's LG Display Co Ltd (034220.KS), the world's No 2 player, has risen more than 60 percent so far this year and third-ranked Taiwan's AU Optronics Corp (2409.TW) has climbed nearly 40 percent as earnings recovered and output returned to normalcy in the second quarter.
Samsung Electronics (005930.KS), the world leader in LCD screens and TV sets, added to the bullish tone on Monday when it forecast strong second-quarter profits. Analysts attributed this to likely high margins in LCD TVs.
But with some concerns over a likely oversupply in the sector later in 2009 as makers from Samsung to smaller Taiwanese rivals ramp up capacity, can the industry still shine in the second half?
LCD names linked to TV powerhouses, such as Samsung and LG Display, are set to gain further, analysts and fund managers said. On top of their strong customer base, South Korean makers are also better positioned to secure glass than Taiwanese rivals hit by shortages in raw materials.
"Consumer spending is holding up in key markets such as the United States and China," said Kim Hyung-wook, a fund manager at KB Asset Management.
Japan's LCD-related shares such as Sharp Corp (6753.T) and Sony Corp (6758.T) are expected to lag as Korean rivals grab more market share.
Many in the sector are betting on sustained strength, pointing to healthy sales of LCD TVs in North America, as well as a boom in purchases of TVs in China, helped by government subsidies.
Last month, research firm DisplaySearch raised its forecast for 2009 LCD TV sales, predicting a 21 percent rise in shipments.
Fund managers said the current shortage in glass used for LCD panels could keep output in check and support prices.
Suppliers of glass for large TV panels are struggling to meet demand after they scaled down output late last year when panel makers were slashing production.
"The glass shortage can linger into the fourth quarter and LCD prices should continue rising until September," said Nam Dae-jong at Midas Asset Management.

600450 LCD Shares: More Gains Or Is The Boom Over?

See more news about:

Others also read

Pleotint launched its new website for their Suntuitive® Dynamic Glass product line
Pleotint, LLC, is pleased to announce the launch of a new website for their Suntuitive® Dynamic Glass product line.
AIS Swytchglas in offices: Bolstering Privacy & Productivity
Glass has always been a popular addition to offices around the globe, often replacing walls and whiteboards in many spaces.
Introducing WhiteOUT™, Your On-Demand Visual Privacy Solution
WhiteOUT™ is the first individual panel frameless opening glass wall system to provide visual privacy on demand.
Mappi strengthens Asian sales network
Far East markets are more and more important for Mappi and Mappi is always more important to Asia.
NODIS Launches Smart Glass Technology With Instantly Electrically Switchable Color, Infrared Filtering and Tinting
NODIS TruTintTM is the world’s first color switchable smart glass technology.
MASCO World Headquarters, Livonia, MI
The Pleotint product boasts a simple approach to the smart glass space, offering no wiring or electronics and using the temperature as the trigger to cause the glass to actively change from a clear to dark state.

From industry

Add new comment