ASE stock outperforms market on Oct. sales


CNA

TAIPEI — Shares of Advanced Semiconductor Engineering Inc. (ASE), one of Taiwan’s leading integrated circuit testing and packaging service providers, outperformed the broader market yesterday after the company reported better than-expected sales for October, dealers said.

ASE closed up 1.08 percent at NT$28.20 on the Taiwan Stock Exchange with 46.40 million shares changing hands, while the benchmark weighted index ended down 0.27 percent at 7,600.79 points amid lingering concerns over the debt problems in the eurozone.

ASE posted NT$15.73 billion in sales for October, up about 2 percent from September. The market had expected a month-on-month decline in ASE sales last month with the start of the a slow season.

In the first 10 months of this year, the company’s sales rose 1.52 percent from a year earlier to NT$154.69 billion.

The growth reflected rising demand from cell phone chip makers, ASE said.

ASE said cell phone chips accounted for more than 50 percent of its total sales, and IC testing and packaging service demand from Apple’s iPhone and other smart phones was driving its revenue growth.

In addition, a falling Taiwan dollar helped boost ASE sales last month because of lower risks on foreign exchange losses, the company said.

However, demand for packaging and testing services for analog ICs in October fell from a month earlier.

The higher-than-expected October sales have prompted Credit Suisse to maintain an “outperform” recommendation on ASE shares and issue a target price of NT$34 on the stock.

Meanwhile, Powertech Technology Inc, one of ASE competitors, posted NT$3.252 billion in sales for October, slightly higher than the NT$3.25 billion recorded in September, on the back of rising demand for flash memory chips.

In the first 10 months of this year, Powertech’s sales rose 5.98 percent from a year earlier to NT$32.98 billion.

Powertech shares closed down 1.79 percent at NT$76.60 on the main board.