For­eign bro­ker­age trims price tar­get for Me­di­aTek shares due to de­mand

The China Post - - TAIWAN BUSINESS -

A Euro­pean bro­ker­age has trimmed its price tar­get for shares of Tai­wanese chip designer Me­di­aTek Inc. ( ) to re­flect weak 3G de­mand in China and in­ten­si­fied com­pe­ti­tion from Chi­nese chip sup­pli­ers.

In a note to clients dated April 27, the bro­ker­age cut its es­ti­mates for Me­di­aTek’s sec­ond quar­ter sales to NT$51.9 bil­lion (US$1.7 bil­lion) from NT$54.2 bil­lion, cit­ing a sharper-than-ex­pected decline in China’s 3G chip de­mand, pric­ing pres­sure on 3G chips and in­creas­ing prod­uct port­fo­lios for low-end 4G chips.

This will drag down Me­di­aTek’s av­er­age sell­ing price of smart­phone chips by 4 per­cent se­quen­tially in the sec­ond quar­ter, with a fall­ing gross profit mar­gin to 45.5 per­cent, the Europe- based bro­ker­age said.

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