By Kim Yoo-chul
Samsung Group plans to expand facilities investment up to 50 trillion won ($44.8 billion) this year as the group’s flagship affiliate Samsung Electronics is ready to splurge on the component business, sources said Thursday.
The amount is compared with the previous year’s facilities investment of 44 trillion won.
``Samsung will invest between 46 trillion won and 50 trillion won. Depending on the market situation, we can adjust our investment plan set earlier,’’ said a Samsung official.
Samsung Electronics, the group’s crucial electronics unit, is expected to receive the biggest slice of the investment budget pie.
Officials say the company will be active in spending on parts such as semiconductors and flat-screens as Samsung is being challenged in the race for premium parts that include OLED screens and logic chips.
``We have sought to strengthen our leadership in the component-making business,’’ said the official. Samsung Electronics is the world’s top supplier of chips and flat-screens.
After the group remained bullish on capital expenditure, several factory-building projects are expected to gain pace.
Samsung Electronics is currently building its first NAND flash memory chip factory in Xi’an, China. The $7 billion worth factory will go into operation sometime early next year, according to market analysts.
As demand for memory chip-embedded products like tablets and smartphones is strong, analysts say Samsung will make an additional investment for the Xi’an factory. Mobile penetration rate is growing with more people buying Web-enabled devices.
Meanwhile, the electronics heavyweight is shifting its chip plant in Austin Texas, toward a logic chip-producing line to better respond to the rising demand for processor chips, which functions as the brain to power devices unlike memory chips.
`` Samsung is one of the few survivors in semiconductors and will continue to grow semiconductor earnings …… as the market continues to grow rapidly powered by smartphones and further improve DRAM margins and share as the DRAM industry moves closer towards a profitable oligopoly,’’ said Sanford C. Bernstein Senior Analyst Mark Newman, in a note to clients, Thursday.
Meanwhile, Samsung officials said that healthy demand for advanced displays such as organic light-emitting diode (OLED) is going to urge the firm to spend more.
``As viewing quality is one of the top considerations for consumers, we will be aggressive in investments on advanced LCDs and OLED screens,’’ said another Samsung official.