4
July 2002
TPV
Techonology
Recommendation:
Buy
Price: S$0.695
Sterling
Performance from LCD Monitors
1Q02's
net profit of US$10.7m (+37.3% yoy) is in line with our
expectations. Turnover rose 41.8% to US$348.8m.
LCD
monitor sales surged. 479k units of LCD monitors were
shipped in 1Q02, accounting for 19% of total shipments,
up from 8% in FY01. Revenue contribution from this segment
rose to 40% from 21% in FY01. Including its 48% associate
in Beijing, TPV is now the third largest manufacturer
of LCD monitors globally (formerly No. 5). In fact, due
to the global shortage of LCD panels, TPV was only able
to meet 80-85% of customers' requirements.
New
orders from US drove ODM business. Despite weak global
PC demand, TPV's ODM business surged 237.1% on the back
of new orders from major PC vendors, DELL and IBM, late
last year. North American sales now account for 20.8%
of sales, up from 17.5% in FY01.
LCD
monitor output is expected to rise to 3m units in FY03,
from 2m in FY02, just by increasing work hours. By FY04,
TPV's new Shanghai plant will be operational to meet increasing
demand. We expect revenue from LCD monitors to grow 133%
and 57% in FY02 and FY03 respectively and maintain our
net profit forecasts of US$51.9m and US$68.9m for these
2 years.
