Foxconn is planning to build an $8.8 billion factory in China that will make liquid-crystal displays using technology from Sharp. The Japanese electronic company’s stock soared another 5.5% today after rising 8.5% on Wednesday.
The prices of LCD TV panels soared towards the end of 2016 as panel makers struggled to meet demand from TV manufacturers such as Samsung. The Korean electronics giant shut down a major factory last summer which accounted for 3% of global LCD capacity and 15% of Samsung’s LCD capacity.
Samsung, which receives an average of 4 to 5 million LCD panels every year from Sharp, is currently in talks with other LCD suppliers such as LG Display (034220.Korea), Reuters reported.
Is the LCD business worth fighting over? Nomura Securities thinks so due to the tight LCD supply, which has boosted producers profit margins. (See chart)