iPhone 5 main hope for Taiwan supply chain: Morgan Stanley
CNA and Staff Reporter 2012-09-14 11:37 (GMT+8)
The iPhone 5 at an Apple press event. (Photo/Xinhua)
Apple's new iPhone will supply key momentum for Taiwanese suppliers in the fourth quarter of 2012 amid stagnant PC demand, US.brokerage Morgan Stanley said Wednesday.
The iPhone 5, one of the most anticipated gadgets of 2012, is scheduled to be released on Sept. 12 in the United States. The device is reported to feature a larger screen, a fourth-generation wireless connectivity and contactless payments.
The smartphone may be available in Taiwan in November at the earliest, suggesting that Taiwanese consumers will have to wait for around 2-3 months for the redesigned iPhone to arrive at stores, according to local telecom operators.
"Apple appears to be the main hope for the Taiwan supply chain to drive up momentum from the fourth quarter onward, though visibility for PC demand stays poor," Jasmine Lu, a Morgan Stanley analyst in Hong Kong, wrote in a research note.
The top stock picks based on the ramping production of iPhone 5 include Taiwan-listed contract electronics maker Hon Hai Precision Industry and Foxconn Technology, a Taiwanese manufacturer of computer casings and electronics, Lu said.
AAC Technologies Holdings, a Hong Kong-listed acoustics components maker, is another recommended stock in the iPhone 5 supply chain due to its higher average selling prices and margins, she said.
As Samsung's flagship Galaxy S3 reached monthly shipments of 5-6 million units in August, Apple has increased production for certain components used in iPhone 5, such as camera lenses, Lu added.
That will benefit two Taiwanese cellphone camera lens suppliers, Largan Precision and Genius Electronic Optical, which are forecast to post quarterly revenue growths of 15% and 10%, respectively, in the fourth quarter, Lu said.
The Apple supply chain, however, was also aware of some downside risks in September that were capped by certain component constraints, including displays, she noted.
