Susie Pan, Taipei; Esther Lam, DIGITIMES [Thursday 8 November 2007]
With the growing use of touch panels, vertical intergation in Taiwan's touch panel industry is drawing a spotlight, especially when companies that have touch panel-related subsidiaries are seeing positive sales and profit contribution from their investments.
J Touch, a touch panel maker invested by the Mitac Group, has drawn attention among industry players after its board of directors recently approved a proposal for a private placement. The company is also preparing to elect its board of directors in December, with four directors and three supervising directors to be elected. J Touch already has investment from Mitac International and Mitac Technology, and whether or not these two companies will increase their investments or increase the number of board seats at J Touch is drawing attention.
Thanks to buoyant demand for small- and medium-size touch panels, J Touch and its rival Swenc Technology, which both are listed on the emerging stock market in Taiwan, both saw their accumulated sales through October soar by over 70% on a yearly basis. Swenc is a subsidiary of the Kinpo Group. J Touch is expected to post profits for three straight years. Both J Touch and Swenc may list on Taiwan's over-the-counter (OTC) stock market as soon as 2008.
Vertical integration in the touch panel business is bearing fruit, as is evident in the positive sales contribution of companies that have investment in touch panel-related companies, either controller or panel makers, industry watchers commented. Such business ties are exemplified by those of Elan Microelectronics-Elantech Devices and that of Holy Stone Enterprise-eGalax_eMPIA Technology Incorporated (EETI).
Elantech is seeing growing sales from touch pad solutions and it is also extending its presence to the touch panel market via strengthening business with its parent company Elan. During a recent directors board election, executives from Foxconn Electronics (Hon Hai Precision Industry) and Powerchip Semiconductor Corporation (PSC) gained seats on the board the controller design house.
EETI is now listed on Taiwan's emerging stock market with a listing on Taiwan's OTC stock market also planned in 2008. The company now has about 40% of its sales generated from sales of touch panel-related solutions. The company saw its sales through October 2007 grow by about 70% on year. Holy Stone holds about a 20% stake in EETI.
Source: Compiled from Digitimes, November 2007
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