12 May 2010


Tekcore to raise $47m to grow from 28 to 46 MOCVD reactors by end 2010

The board of directors of Taiwan-based LED chipmaker Tekcore has decided to issue 50 million new shares worth NT$1.5bn (US$47.4m) to raise funds for equipment purchases, reports Digitimes.

Tekcore's two shareholders, Epistar and Everlight Electronics, are expected to increase their stakes in the firm (from 19.3% and 9.9% currently, respectively) and to take seats on the board.

Tekcore says that it will continue to expand its LED production capacity and start building a new plant in June, for completion by the end of 2010, adding that the new plant will start contributing to revenue in 2011.

With the shortage of high-brightness (HB) LED chips on the market, Tekcore’s LED production has been running at full utilization. The firm therefore plans to increase its number of MOCVD reactors from 28 now to 38 at the end of June, 43 by the end of September, and 46 by the end of 2010. Correspondingly, its monthly capacity of 2-inch GaN epiwafers (blue, green) will rise from 45,000 units now to 80,000 at the end of the year, while 3-inch GaAs epiwafers (red, yellow) will remain at 8000 units, says president Jonathan Lu.

Regarding the recent price hikes amid the shortage of sapphire substrates, Tekcore notes that the shortage is mainly for 2-inch epiwafers, but it will focus more on 4-inch epiwafers (which should reach 50% of the firm’s total production in 2010).

Tekcore says that there is no shortage of sapphire substrates for 4-inch epiwafers, as not too many LED chipmakers are producing on 4-inch (a segment that has a higher technological threshold). The firm says it will sign long-term cooperation agreements with its suppliers for this segment.

Tekcore says that backlighting products should account for at least 40% of its total revenues in 2010, mainly for TVs. Lighting products will account for 25%, plus 15% from the handset segment, 10% from the billboard segment, and 5% each from the decorative light (e.g. Christmas lights) and automobile segments, the firm adds.

Due to the shortage of LEDs, average selling process (ASPs) are expected to remain stable in second-half 2010, and Tekcore expects its revenue to reach over NT$600m in the second quarter, over NT$700m in Q3, and almost NT$800m in Q4. Revenues for full-year 2010 should reach NT$2.6bn, up 110% on 2009, Tekcore reckons.

See related items:

Taiwanese LED makers expanding to meet backlighting demand

Tekcore orders multiple new-generation Aixtron AIX G5 HT systems

LED chip-maker Tekcore raising capital to fund MOCVD purchases

LED shortage looms in 2010

HB-LEDs to drive doubling of MOCVD sales to 415 systems in 2011

Search: Tekcore HB-LEDs LCD TV backlighting MOCVD