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LCD equipment, materials suppliers benefiting from aggressive capacity build-up in China

Taiwan's supply chain makers for LCD manufacturing equipment and materials are set to see their sales momentum continue in 2019, with most of them having enjoyed strong sales last year, according to industry sources.


These suppliers have been enhancing their deployments in China to cash in on the on-going capacity ramps being implemented by China's flat panel makers.


As a result of the continued expansions, China now serves as the top supplier of TV panels worldwide, accounting for 46.4% of global unit shipments and 41.9% of panel area shipments in the first quarter of 2019, according to Sigmaintell Consulting.


Additionally, China's production capacity for large-size LCD panels is expected to account for 45% of the global production in 2019.


By 2020, there will be a total of 18 8G and more advanced LCD fabs operating in China, including 13 8.5G/8.6G lines and five 10.5G lines.


China's makers are also keen to expand their OLED panel production capacity, with the number of its OLED lines - including those that have kicked off volume production and those still being built - totaling 13.


Taiwan-based automated optical inspection (AOI) equipment specialist Utechzone and fab toolmakers Mirle, Csun Manufacturing, Marketech International, and Contrel Technology, have been benefiting from the investment binge in China, said the sources.


Utechzone saw its revenues increase 11% to NT$3.12 billion (US$100.99 million) in 2018, buoyed by increased shipments of AOI devices for PCB, COF packaging and other semiconductor packaging applications.


Csun's revenues expanded 13.92% to a 22-year high of NT$5.699 billion in 2018. The company's net profits of NT$549 million or NT$3.68 per share for 2018 were also its highest-ever levels. With a backlog of orders on hand, Csun expects its sales to reach a new high in 2019.


Marketech posted revenues of NT$24.4 billion in 2018, up 20.8% on year and also the highest-ever level for the company. With an influx of orders from China, the company looks to continued growth in 2019 and 2020.


Mirle's revenues surged 16.3% to a record high of NT$14.4 billion in 2018, while Contrel's revenues rallied 66.2% to NT$6.91 billion.


Meanwhile, polarizer supplier BenQ Materials reported its revenues grew 2.54% on quarter and 14.59% on year to a four-year high of NT$3.391 billion in the first quarter of 2019, having seen its sales grow 14.6% to NT$12.76 billion in 2018.