LCD panel prices halt rise in June on sluggish TV sales

Prices of liquid crystal display (LCD) panels halted advances in the first half of this month on slow demand for TVs in advanced countries, market data showed Tuesday, sparking worries about the second-quarter profits of panel makers. Prices of 40- to 42-inch LCD panels for TVs, which rose for the first time in 20 months in May, remained flat in the first half of this month from two weeks ago, according to DisplaySearch, countering market expectations that they will continue to rebound. The Santa Clara, U.S.-based market researcher announces panel prices twice a month. Prices of light-emitting diode (LED)-backlit LCD panels for TVs have stayed unchanged for three months in a row, according to DisplaySearch. TV panel makers tried to hike panel prices this month following a 20-month-long panel price fall, DisplaySearch said, but TV vendors were reluctant to increase their inventories. Market watchers said sluggish demand for TVs in North America and Western Europe, coupled with stiff competition among TV makers driving down TV prices, continued to weigh on panel makers. Prices of LCD panels used for personal computers and mobile phones failed to bounce back this month, DisplaySearch said. LCD panel prices for PCs remained unmoved while small-sized LCD panels for mobile phone inched down about 1 or 2 percent from the second half of May. The slower-than-expected price rebound of LCD panels will likely hurt the bottom lines of LCD panel makers, such as Samsung Electronics Co. and LG Display Co., analysts said. "Due to the lower-than-expected growth of memory chip sales, weaker LCD panel prices and slow profitability improvement of LCD production, Samsung Electronics will post a second-quarter profit that falls short of expectations," said Han Seung-hoon, an analyst at Korea Investment & Securities Co. Han revised down the second-quarter operating profit estimate of Samsung's LCD division to 136 billion won (US$126 million) from 180 billion won. In the second half of this year, however, panel prices are forecast to rebound, analysts added.