Hon Hai shares climb after partnership with US' Vizio
CNA January 10, 2014, 12:17 am TWN
TAIPEI--Shares of Hon Hai Precision Industry Co. (鴻海精密), the world's largest contract electronics maker, outperformed the broader market to close in positive territory Thursday as investors took cues from the company's cooperation with U.S. TV brand Vizio to unveil a 120-inch ultra HD TV, dealers said.
The buying showed investors optimism toward Hon Hai's bottom line at a time when the company is gearing up to diversify its product portfolio to raise its global competitiveness, the dealers said.
Shares of Hon Hai rose 1.26 percent to close at NT$80.50 (US$2.68) with 67.68 million shares changing hands, while the weighted index on the Taiwan Stock Exchange ended down 0.48 percent at 8,514.68 points.
The stock opened slightly lower in line with the index, which was affected by a lackluster Wall Street overnight, but buying emerged immediately on the back of the launch of the ultra HD TV at the International Consumer Electronics Show (CES), the dealers said.
A day earlier, Hon Hai Chairman Terry Gou (郭台銘) visited a showroom at the annual CES, where a 120-inch 4K TV his company assembled for Vizio was displayed.
Gou praised the new Vizio TV for its production technology, including design ability, flat screen manufacturing and TV image quality.
New Vizio Model to Be A Big Hit: Gou
Gou said that Hon Hai and Vizio — the largest TV supplier in the U.S. market — made lots of efforts to surmount technology hurdles before launching the product he described as the pride of ethnic Chinese society.
According to Gou, Hon Hai and Vizio have had a long term partnership for years. Hon Hai has previously assembled 60-, 70- and 80-inch TVs for the Vizio brand.
Along with many high-tech devices, the Jan. 7-Jan. 10 CES, one of the largest consumer product exhibitions in the world, focuses on a wide range of TV products, including 4K TVs, smart TVs and curved-screen TVs.
Gou said that to his knowledge, many potential foreign buyers are paying close attention to the new Vizio model and that he expects the product to become a big hit.
The move to enter the large-sized TV business was part of Hon Hai's efforts to sharpen its competitive edge and boost its profit margin in the highly competitive global electronics market, the dealers said.
In 2012, Gou, under his own name, acquired a 46.5-percent stake in the a plant in Sakai, Japan, from Japanese consumer electronics giant Sharp Corp. for about US$800 million. Hon Hai has been using screens produced by the plant for large-sized TV production.
Gou also said that Hon Hai plans to continue to expand its TV business this year.
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