Apple’s reported placing of large orders for Elpida Memory’s mobile DRAM chips will not affect Samsung Electronics shares or its global supply chain in the long-run, analysts said Thursday.
The effects of the unconfirmed news are likely to be short-lived and limited to boosting the fundamentals of Korean semiconductor players, including SK Hynix, whose production capacity still outweighs that of the Japan-based chip maker.
“Elpida’s production capacity lags behind that of Samsung and Hynix, still making Korean companies a lot more competitive in the global markets,” said Kim Hyung-shik, an analyst at Taurus Investment & Securities.
Elpida’s capacity at its Hiroshima plant is only about 34 percent of that of Samsung, the world’s largest memory chip manufacturer, and 46 percent of Hynix’s, the analyst noted.
A Taiwan-based media website reported that Apple has recently ordered mobile memory chips produced at Elpida’s Hiroshima plant. The order will allow Apple, the innovator behind iPhones and iPads, secure about 50 percent of the Japanese company’s total production, it said, citing industry sources.
However, local analysts said that the market has “over-reacted” to this news, which has not yet been confirmed either by Apple or Elpida, hitting shares of Samsung Electronics on Wednesday.
“There won’t be significant change among chip suppliers’ positions even if Apple gains 50 percent of Elpida’s chips,” said Park Young-joo, an analyst at Woori Investment & Securities.
Elpida, which the U.S.-based Mircon Technology is acquiring, currently supplies 45 percent of its mobile DRAM to Apple, the analyst noted.
Meanwhile, only 15 percent of Samsung’s mobile chips are supplied to Apple, while the U.S. smart phone developer gets 35 percent from Hynix. Apple’s mobile DRAM purchases only account for some 20 percent of the total.
Besides, Samsung’s memory chip business has only contributed to less than 10 percent of its operating profit in the first quarter of 2012, analysts said.
Samsung Electronics shares finished at 1.223 million won, down 7,000 won, or 0.57 percent, while Hynix ended up 1,450 won, or 6.29 percent, at 24,500 won Thursday.
