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May sales for IC packaging, testing services could grow

TAIPEI, Taiwan -- Local integrated circuit packaging and testing services providers are expected to enjoy an increase in sales in May from a month earlier as mobile device makers and personal computer manufacturers keep building up their inventories, market analysts said Saturday.

Demand for tablet computers and budget smartphones continues to grow, benefiting the global semiconductor industry, while the waves of PC replacements due to Microsoft's end of its support to the Windows XP operating system is also likely to drive the IC business higher, the analysts said.

Rising consumer enthusiasm in ultra-high definition TVs, as well as telecom operators' efforts, in particular in China, to set up base stations for 4G networks are expected to further boost demand for IC packaging and testing services, they added.

Siliconware Precision Industries Co. is one of the local IC packaging and testing firms that will ride the uptrend to continue to post good sales in May, the analysts said.

In April, Siliconware recorded NT$6.82 billion in consolidated sales, the highest level in the company's history, up 5.6 percent from a month earlier and also up 21.38 percent from a year earlier.

In May, demand for Siliconware's IC packaging and testing services for smartphone chips and chips for 4G network base stations was on the rise, analysts said, adding that the company's consolidated sales for May could surpass NT$7 billion.

Siliconware Chairman Bough Lin said he expects the company's second-quarter consolidated sales to top NT$20 billion, a quarterly record high, up from NT$18.06 billion in the first quarter, on demand for high-end IC packaging and testing services. Even better, Lin said, sales growth momentum will continue into the second half of this year.

Analysts said Advanced Semiconductor Engineering Inc. (ASE), the world's largest IC packaging and testing services provider, is expected to witness sales generated from its IC packaging and testing and material offering operations in May to grow further after a month-on-month rise of 2.1 percent in April, when the sales figure stood at NT$12.71 billion.

Powertech Technology Inc. is expected to benefit from rising demand for packaging and testing services for mobile memory chips, flash memory chips and logic ICs to push May sales even higher, analysts said.

In April, Powertech's consolidated sales hit a 16-month high of NT$3.41 billion, up 2.7 percent from March and also up 9.4 percent from a year earlier.

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