02.22.2001
Inventec and Toshiba deny NB PC order rumours

• Inventec's (2356 'Ying Ye Da') share price yesterday responded to rumours that it had won an NB PC order from Toshiba, rising 3.5% to NT$38.5. Local mutual funds and institutions were major buyers.

• The rumours are being denied by both Inventec and Toshiba. Toshiba confirmed that Compal (2324 'Ren Bao') remained its sole OEM manufacturer in Taiwan. It indicated that 2001 NB PC shipment from Compal will depend on market demand. We believe Toshiba will not increase NB PC outsourcing in Taiwan this year, staying at around 600k sets.

• We expect Inventec to continue its one-client business model. Growth will be driven by the IA and server segments. The market views Inventec Appliance (unlisted), a subsidiary of Inventec, as the most likely candidate in Taiwan for PDA orders from Palm and Sony, although a deal has yet to be finalized.

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