By Kim Yoo-chul
GOYANG, Gyeonggi Province ― LG Display Wednesday ruled out a new share sale to raise funds for capacity expansion, while Hynix Semiconductor expects to have its stake sale completed by the end of the year.
Top executives gathered at this year’s Korea Electronics Show (KES) at the KINTEX Convention Center, explaining their future plans and current situations.
LG Display CEO Kwon Young-soo said the firm will slash next year’s capital spending to a maximum 3 trillion won, the lowest in four years.
``LG Display doesn’t have any plan to sell new shares to raise funds,’’ Kwon told reporters.
Speculation has been raised that LG Display may issue new shares after it recently failed to meet its target to raise 300 billion won by selling corporate bonds.
By the end of the year’s third quarter, LG Display had raised 900 billion won from financial markets by selling new corporate bonds, according to local brokerages.
Kwon expects the global LCD industry to improve from the second half of next year because cheaper TVs will enter the market, sparking consumer demand.
Manufacturers have higher hopes for a rebound of LCD prices later next year as the demand for LCD- devices will pick up with the Summer Olympics in London and other big international sports events.
Kwon is regarded as the right-handed man of LG Electronics chief executive and LG Chairman Koo Bon-moo’s younger brother Koo Bon-joon.
The top executive also told reporters that plans to build cutting-edge LCD-panel production facilities in southern China are still on hold.
``Beijing has asked us to invest in the facilities as early as possible, however, nothing has been decided,’’ said Kwon.
Rival Samsung Electronics plans to change its earlier plan of constructing a 7.5th-generation LCD factory to build advanced eighth-generation facilities.
LG Display will announce its third quarter earnings report next week.
In a separate meeting with reporters, Hynix CEO Kwon Oh-chul, said he expects the ongoing stake sale process of his firm to be finalized around the year-end.
SK Telecom, the nation’s biggest telecom company, is the only suitor left bidding for a controlling 20 percent of Hynix, worth about 3 trillion won, after Korean shipbuilding and shipping group STX dropped out.
``We don’t think the stake sale completion will take too much longer. It’s expected to be completed either by the year-end or early next year,’’ said the Hynix chief executive Kwon.
He said the world’s second-biggest memory chipmaker will invest between 3.4 trillion and 3.5 trillion won in facilities by the end of this year, as planned, and added the investment is a separate matter.
On questions over the technology road-map, Kwon said, ``We’ve seen some difficulties for smoother tech migration in the first half, however, Hynix is the sole player in the industry which has seen the fastest technology migration and the improvement of production yields.’’
In chip-making, chips with thinner technology have low power consumption and enhanced data-processing speeds. Hynix said memory chips applying a fine 30-nano technology will take up 40 percent of the total this year.
Hynix CEO Kwon also agreed with LG Display’s Kwon in seeing a brighter market outlook next year. He said rivals cutting spending will help the global memory chip industry see a balance between supply and demand.
``Demand for NAND flash memories will get stronger thanks to a rising demand for products using NAND such as tablets and smartphones. Thus, Hynix will invest more in those chips,’’ he told reporters.
``The recent depreciation of the local currency against the U.S. dollar is helping us see better operating profit. We will report better earnings in the fourth quarter from the third.’’
Korea’s flagship exporters including Samsung Electronics, Hynix, LG Electronics and Hyundai Motor will be inwardly delighted with the local currency’s recent sharp fall because a depreciation of the won makes Korean exporters better positioned in price competitiveness than their Japanese and U.S. rivals.