Tuesday, November 29, 2011

Decreased LCD shipment in October; Raen and HKC have positive outlooks

TAIWAN: According to the shipment report of top ten global LCD monitor brands and SIs in October published by WitsView, TrendForce’s panel research division, October shipment by brands dropped by 5.2 percent compared to September, while October shipment by SIs decreased by 8.8 percent.

The shipments decline by brands and SIs was due to: advanced distribution by downstream vendors in August and September, pull-in strength for October sales decreased affected by the expansion of the Europe debt crisis and weak global economic momentum. Shipments by SIs experienced more pronounced decline compared to brands in October as their production capacity was cut by the long weekend October 1st National Holiday in China.

In terms of the Q4 shipment outlook, a decrease in shipment demand is due to several factors:
a) Orders were made in advance inQ3;
b) The flood in Thailand has indirectly impacted shipments of LCD monitors for PC bundles due to HDD shortage;
c) While panel prices are expected to stabilize in the Q4, there is no momentum to support a rebound as demand grows weak.

Only 19W and 23.6W products will experience tight supply due to panel supply decrease. Since downstream vendors will generally remain conservative in stocking up, WitsView forecasts SIs and brand vendors to experience shipment decline between 1 percent and 5 percent in the Q4.

Panel makers are aggressively nurturing joint venture SI makers such as Raken Technology Ltd (a joint venture by LG Group and Amtram Group) to consolidate downstream outlets and digest huge panel production capacity as feeble global economic environment puts the panel industry in long term oversupply condition.

In such phenomenon, Raken’s contracting scale has grown from 300K units in 2010 to 1 million in 2011, with its shipment number is expected to double next year. Its drastic growth against market trend makes Raken a strong contender among the LCD monitor SIs. China LCD monitor and TV SI, HKC, on the other hand, has been growing quietly but steadily and is expected to pose a total monitor shipment volume of 5.5 million to 6 million this year while its TV production volume is expected to reach 1.5 million to 2 million units. The company is surely not to be underestimated in the future.

1Q11~4Q11 LCD Monitor Top10 SIs and Brands ShipmentsSource: WitsView, Taiwan.

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