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Shares of Nanya, Inotera rise on upbeat Q4 outlook

Shares of Nanya, Inotera rise on upbeat Q4 outlook

Taipei, Oct. 24 (CNA) Shares of Nanya Technology Corp. and Inotera Memories Inc., two of Taiwan's leading DRAM chip suppliers, moved higher Thursday morning on optimism toward their earnings outlooks for the fourth quarter, dealers said. The buying also reflected an improvement in the two companies' results for the third quarter on the back of a recovery in DRAM prices due to a tight supply, the dealers said. As of 11:23 a.m., Nanya shares had risen 5.16 percent to NT$4.28 (US$0.15), while Inotera shares had increased 1.07 percent to NT$18.90. The weighted index on the Taiwan Stock Exchange was down 0.15 percent at 8,381.36 points. "I expect that many of Nanya's and Inotera's clients will continue to build up their inventories in the fourth quarter to meet demand from China ahead of the next Lunar New Year holiday, which will fall in late January 2014," Hua Nan Securities analyst Stan Chang said. "It is possible that the two companies will continue to report profits for the October-December period," Chang said. In an investor conference held a day earlier, Inotera Chairman Charles Kau said he expects his company will post another fresh high in net profit for the fourth quarter. Kau said a fire that struck a plant of South Korean DRAM maker SK Hynix Inc. in early September, which has caused a production cut in the world's second-largest supplier, is expected to continue to keep the supply tight and push up product prices in the fourth quarter. Kau is also president of Nanya. Both firms are the DRAM manufacturing arm of the Formosa Plastics Group. For the third quarter, Inotera recorded NT$7.29 billion in net profit, or NT$1.21 in earnings per share (EPS), compared with NT$3.47 billion in net profit, or NT$0.62 in EPS registered in the second quarter. Its third-quarter consolidated sales rose 33 percent from a quarter earlier to NT$16.94 billion. Inotera said both its third-quarter net profit and sales hit new quarterly highs in the company's history. Market analysts said Inotera could see its consolidated sales for the fourth quarter growing 20 percent from the third quarter. For its part, Nanya posted NT$1.98 billion in net profit for the third quarter, or NT$0.08 in EPS, up from NT$1.68 billion in net profit or NT$0.07 in EPS recorded in the previous quarter. "The growth in Nanya's and Inotera's earnings have been widely expected by many market analysts, in particular after the Hynix fire at its plant located in China's Wuxi prompted many buyers to restock their inventories to push up product prices," Chang said. "Also due to solid demand from China, the slow season effects, which used to be seen in the fourth quarter for the semiconductor industry, will not be so visible to the DRAM business," he added. (By Jackson Chang and Frances Huang)


Updated : 2021-01-20 12:50 GMT+08:00