02.12.2001
January revenues on a downer

• First-tier NB PC makers' Jan. revenues declined across the board: Quanta (2382 'Guang Da') recorded sales of NT$5.92b, down 22% MoM, but up 46% YoY. Compal (2324 'Ren Bao') saw Jan. sales of NT$4.96b, a 23.6% decline MoM and a 10% rise YoY. Inventec (2356 'Ying Ye Da') and Arima (2381 'Hua Yu') put in a poor performance, turning in negative yearly and monthly growth figures. In Jan., Inventec's sales fell 44% MoM and 26% YoY to NT$4.1b; Arima's Jan. revenues of NT$1.5b were down 2.9% MoM and 61% YoY.

• Although Toshiba Taiwan stated last weekend that its OEM relationship with Compal has not changed, it has not disclosed any information on OEM orders for Compal this year. Compal's share price was down 15% to close at NT$52 last week, heavily sold off by QFII on market rumors that Toshiba will halt OEM orders in Taiwan this year. Toshiba is one of Compal's three biggest customers. We are keeping a wary eye on Toshiba as the company is building a plant in Shanghai and also plans to increase production in the Philippines. We downgrade our recommendation on Compal to HOLD from ACCUMULATE.

MarthaChen@Primasia.com +886-[0]2-2547-8878