LG Display sees positive H2, LCD prices up

SEOUL, Aug 6 (Reuters) - LG Display Co Ltd (034220.KS) said on Thursday that it expects the uptrend in PC screen prices to continue into autumn thanks to a shortage of raw materials and as corporate demand is showing signs of recovery.

The South Korean flat-screen maker would likely see PC panel prices rising faster than expected in the third quarter, with prices already up 10 percent in July, said Davis Lee, vice-president in charge of marketing for monitor and notebook panels.

"The trend could continue until October for notebook prices," Lee said in an interview, adding that the strength would probably continue until September for PC monitor panel prices.

LG Display is the world's biggest maker of notebook LCD panels with more than a 30 percent market share. In the overall LCD sector, it ranks second after domestic rival Samsung Electronics Co Ltd (005930.KS), but ahead of Taiwan's AU Optronics Corp (2409.TW).

Notebook PC and desktop monitor screens account for 40 percent of sales at LG Display, which supplies to Hewlett-Packard Co (HPQ.N) and Dell Inc (DELL.O), among other customers.

The company posted forecast-beating earnings for April-June, as the liquid crystal display (LCD) industry recovers from a downturn in demand for flat TVs and higher panel prices. [nSP56216]

While consumer demand for PCs has been holding up, partly helped by China's subsidy programme for rural consumers, Lee predicted that the long-depressed corporate PC market could finally take off.

"The market seems to be in better shape than industry projections suggest," he said, when asked about the second-half outlook.

"Considering the PC replacement cycle, there could be a big opportunity in the corporate PC market either in the second half of this year or the first half of next year ... there will be some needs from the fourth quarter."

LG Display said earlier on Thursday that its computer monitor panel sales in July rose 75 percent from a year earlier, helped by recent capacity expansion. Its shares ended up 1.8 percent, leading the KOSPI's 0.4 percent gain. [nSEF000306]
Lee said he expected the industry to continue to experience a shortage in glass substrates through September, but added that LG Display was working to minimise the impact.

Glass suppliers such as Corning Inc (GLW.N) and Asahi Glass Co Ltd (5201.T) have been slow to raise output after last year's slump in the flat-panel industry.

Lee also said LG Display's share of the fast-growing netbook panel market was expected to exceed 30 percent next year from a low-20s percent currently.

Margins on screens for netbooks, or mini-notebook PCs, were improving as the market grew in size and more established players rolled out models, making it a key segment, he added.

Research firm DisplaySearch forecast netbook shipments to double to almost 33 million in 2009, while the growth in traditional notebooks was projected to be flat.

(Reporting by Rhee So-eui; Editing by Chris Lewis)

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