Shares of Wintek higher on back of Samsung order reports
CNATAIPEI -- Shares of Wintek Corp., one of Taiwan's leading touch-panel makers, moved higher yesterday after the local media reported that the company had received orders from Samsung Electronics Co. to provide one glass solution (OGS) screens to the South Korean firm, dealers said.
March 2, 2013, 12:02 am TWN
The buying reflected optimism that the orders from Samsung would boost Wintek's shipments of OGS panels, which command a relatively high profit margin, they said.
At the end of trade, Wintek added 6.79 percent to NT$14.95.
“The Samsung order report did ignite strong interest in Wintek shares soon after the local bourse opened,” Horizon Securities analyst Benson Huang said. “If the reports are proved to be true, such rush orders will no doubt lift Wintek's sales.”
According to the reports, Wintek has secured orders from Samsung to provide its OGS screens for production of the South Korean firm's latest 8-inch tablet computer — Galaxy Note 8.0 — which is scheduled for launch in the second quarter.
The reports said this was the first time Wintek was joining Samsung's global supply chain.
In addition to Samsung, the U.S.-based Amazon, Taiwan's Asustek Computer, and Lenovo Group of China are major buyers of Wintek's panels for tablet-computer production, the reports added.
Wintek declined to comment on the reports, saying the company never comments on specific clients.
In January, Wintek posted NT$7.35 billion in consolidated sales, up 4.75 percent from December, but down 17.28 percent from a year earlier. OGS panels accounted for 55 percent of the company's total sales.
Huang said Samsung's tablet computers have gained popularity in the global market, and the new 8-inch tablet could win more market attention due to its unique specifications.
“If the Samsung order reports are true, OGS panels will weigh more in Wintek's sales in the upcoming months. Many investors are looking forward to such a positive development,” Huang said.
However, Huang said he suspected the reason Samsung was outsourcing the production of OGS screens to Wintek or other touch-panel makers was that the South Korean firm was suffering a shortage in supply from its original suppliers.
“I am afraid that once supply becomes stable, Wintek will lose its orders,” Huang said.
Despite the gains posted by Wintek shares, Huang said, uncertainty over the company's bottom line remained due to its product mix, which could impact its profitability.
“Wintek could continue to incur losses this year. So, I expect its shares will encounter stiff technical resistance as the stock moves closer to NT$16,” Huang said.
In the first nine months of this year, Wintek posted NT$0.77 in loss per share. Huang said the loss could reach around NT$1 per share for 2012 and range between NT$0.3 and NT$0.5 for 2013.