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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (8318)	12/15/2003 3:34:25 PM
From: Proud_Infidel	Respond to of 25522

LCDs to boost IC-equipment makers By Mark LaPedus Silicon Strategies 12/15/2003, 1:00 PM ET CHICAGO--What's the next catalyst for the semiconductor equipment industry? Try flat-panel displays. In total, the worldwide flat-panel display market is projected to grow from $15 billion today to $80 billion by 2005, according to a report issued today (December 15, 2003) from Berean Capital Inc., an investment banking firm in Chicago. In comparison, the semiconductor industry is showing much slower growth. The IC industry is expected to grow from $175 billion in 2003 to $225 billion by 2005, according to the report. In the flat-panel display market, capital equipment makes up 15-to-20 percent of the overall manufacturing costs, said Vijay Rakesh, who watches the fab-tool industry at Berean Capital. Materials, especially glass substrates, make up 70 percent of the total costs for flat-panel displays, Rakesh said. So in other words, capital spending in the flat-panel display market is expected to reach $10-to-$12 billion by 2005, he said. However, equipment for displays is less capital intensive than that of semiconductors. Capital equipment makes up 70 percent of the overall manufacturing costs in semiconductor fabs, he said. As a result, the average investment rate for capital spending is 15-to-20 percent in the flat-panel display industry, verses 25 percent in the semiconductor sector, according to the report. Still, the potential is eye-popping for fab-tool vendors right now. "In addition to the 30 or so 300-mm fabs in the semiconductor industry, there are about 8-11 fabs in the flat panel industry which are garnering a lot of capital spending," he said. "For example, Samsung in 2003, spent $3.76 billion on its 300-mm semiconductor fabs and about $1.56 billion on its flat panel LCD fabs; that is a 30 percent allocation to FPD," he said. In fact, the flat-panel display action is located in Asia, where more than 99 percent of all LCDs for TVs, notebooks or wireless handset are made. But don't look for the boom times to last forever. The flat-panel boom or rather expansion is expected to last two-to-three years, followed by a slowdown, according to the report.