Sharp Moves Up Launch of Kameyama 2 LCD Panel Factory

It looks like Sharp paid heed to analyst concerns that its capacity would be too limited to benefit from the usually prosperous holiday shopping season. Fret no more because Sharp is moving up by two months the launch of its Kameyama 2 LCD panel factory to the beginning of this month, instead of October.

Initially Kameyama 2 will have a monthly capacity of 15,000 panels and by March 2007 will be able to put out 30,000 with the start-up of a second production line. 8th generation panels will be manufactured meaning each substrate of glass will be cut for either eight 40-inch class panels or six 50-inch class panels. Sharp announced that production of glass substrates will begin this month, while production of large-screen LCD TVs equipped with the panels will begin in September. These LCDs will be for targeted at Sharp's global markets.

For more details see Sharp's press release by clicking here.

For a summary of Sharp's Q1 earnings see: Sharp Posts Record Quarter, LCD TV Sales Double Y-o-Y.

Ordinary shares of Sharp (Tokyo: 6753) closed Monday down 0.10% at 1,935 yen ($16.76). Its ADRs closed yesterday up 0.90% at $16.75.

Sharp Corp (SHCAY) 1-year chart:

Comments

[Simon Lewis:]

Sharp's earlier than expected launch of mass-production from their Gen 8 Kameyama No. 2 fab will not significantly impact their available of key 32" and 37" panels since these are not produced efficiently at the new plant; the volume of production at Kameyama No. 1 of 45" and larger panels was limited so freed up capacity is not enormous. Sharp will continue to depend on Taiwanese suppliers to make up their numbers.

However, Sharp will able able to make a serious play in the >40" market for the first time, and this is significant.

Probably most significant is the innovative processes that Sharp claim to have in their new plant. Sharp already have the highest margins in the industry. If they have truly succeeded in significantly reducing unit costs, then their challenge to plasma (especially Matsushita) and current large format LCD market leaders Sony and Samsung could restore Sharp to the leadership position they enjoyed until a little more than 1 year ago.

2006 Aug 03 07:53 AM