07.19.2001
Prodisc delays capex on DWDM TFF equipment

• Development: Prodisc has delayed capacity expansion on DWDM (Dense Wavelength Division Multiplexer) TFF (Thin Film Filter) equipment indefinitely.

• Analysis: The company believes demand for the DWDM TFF remains in the doldrums atop severe price erosion from heightened competition. Flattening CD-R prices have contributed to the attrition of company’s bottom line.

• Primasia View: We revise down 2001 EPS to NT$0.90, which translates into a PER of 56x. Thus we downgrade the stock to Sell from Weak Hold.

VincentChen@Primasia.com +886-[0]2-2547-8868