06.12.2001
AU Optronics ranks the No.4 TFT-LCD maker

• AU Optronics, the new entity created from Acer Display Technology (2409 'Da Ji') and Unipac (5441 ‘Lian You’) merger, was ranked the fourth largest TFT-LCD maker in the world in terms of market share. According to Display Search, AU Optronics raised market share to 7.6% in 1Q01 up from 6.5% in 4Q00. Samsung, LG Phillips and Hitachi held the top three positions.

• Display Search reported 10.4inch plus (large size) TFT-LCD shipments increased 36% YoY (in units), while output decreased 17% YoY due to panel price erosion. Looking forward, it is estimated the performance scenario will worsen in 2Q01. Forecasts indicate that TFT-LCD output amount will continue to decline 17% QoQ and 36% YoY. Panel prices are expected to stabilize in 2H01 on the back of rising demand for LCD monitors, and Display Search estimates TFT-LCD output value will increase sequentially from 3Q01. Our view holds TFT-LCD equilibrium supply will occur probably around 1H02, supported by price declines boosting LCD monitor demand. We believe decreased capex spending along with Japanese manufacturers moving into smaller size screen market will limit growth on the supply side.

• VB Primasia Investment Opinion: ADT and Unipac recorded highs in May for both revenue and TFT-LCD panel shipments. The new entity will enjoy much lower costs on the back of economies of scale and hold greater bargaining power for components. Furthermore, the merger will result in more efficient gains, while enabling the development of full size TFT-LCD panels. We recommend OUTPERFORM ratings on both counters. MarthaChen@Primasia.com +886-[0]2-2547 8878

MarthaChen@Primasia.com +886-[0]2-2547-8865