Passive component maker Walsin to boost capacity by 20% in 2H18

Source: Digitimes news

Passive component maker Walsin Technology has ramped up its investments in capacity expansion quarter by quarter since the beginning of 2018, with the investments to drive up capacity by 20% following the completion of all the additional equipment in the second half of the year, according to company chairman Chiao Yu-heng.

At the firm’s annual shareholders meeting held June 28, Chiao said that Walsin’s sustained investment drive is mainly aiming to prevent its customers from suffering shortages in the supply of passive components including MLCCs, chip resistors, and RF components.

Chiao said 2018 is a lucrative and very special year for the passive components sector, with tight supply lingering in the first half of the year – a low season for the electronics industry, and supply shortages to worsen in the second-half high season, prompting the company to expand capacities to better serve customers.

Despite capacity expansions by Walshin and other peer makers, the growth in demand for passive components from the sectors of 5G, automotive electronics, 3D sensor, AI, IoT and high-performance computing applications has far outpaced the supply increase, significantly driving up average selling prices (ASP), according to Chiao.

He commented that the era of price reduction on passive components has gone, and consistent quality and stable shipments are what count most for makers in the industry.

Chiao believes that Walsin’s revenues and profits will pick up steadily along with its efforts in capacity expansion, development of high-end products, and optimization of product portfolios.

The shareholders meeting approved a company plan to issue 20 million common shares for private placements. Chiao said his company hopes to introduce players from other business lines or downstream customers as new investment partners, especially those sharing same business concepts with Walsin.

The meeting also passed a proposal for Walsin to dole out cash dividend of NT$4 per share to shareholders in accordance with its 2017 profit performance.

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