Toshiba to raise 2000-01 chip capex to 170 b. yen

TOKYO: Japan's Toshiba Corp said on Wednesday it was considering raising

semiconductor capital investment to about 170 billion yen for the year to next

March from an original 130 billion yen target.

That reflects surging demand for semiconductors, especially large-scale

integration (LSI) chips and flash memory for mobile phones and digital

electronics, and would match its record chip investment in 1995, '96 and '97

fiscal years, a spokeswoman said.

It also would be the latest in a series of capex reviews announced by Japan's

top semiconductor makers in recent months.

The news gave a moderate lift to the shares of Toshiba–Japan's

second-largest chipmaker–as market watchers had anticipated such a move.

By 0120 GMT, the shares were up 1.71 per cent to 1,127 yen and were the

second most heavily traded on the Tokyo Stock Exchange. They have gained 25 per

cent since the August 4 close on expectations of good earnings in the current

business year.

On Monday, Toshiba said it had doubled its consolidated operating profit

forecast for its chip making business to 130 billion yen from 65 billion yen for

the year to next March.

It also lifted its consolidated net profit estimate to 135 billion yen from

100 billion yen, against a 28 billion yen loss last year.

Three other top chipmakers have in recent months raised capital spending

plans from their original forecasts in April.

Mitsubishi Electric Corp, Japan's fifth-biggest chipmaker, said last month it

would boost chip investment to a record 150 billion yen from an original plan of

100 billion yen this business year and against 57 billion yen last year.

In May, Fujitsu Ltd., the fourth-ranked chipmaker, unveiled a 40-billion yen

rise in its original chip spending plan for this year to 200 billion yen. NEC

Corp, the biggest chipmaker in Japan and the second largest worldwide, plans to

raise spending to a record 220 billion yen, up 10 per cent from an April

estimate.

(C) Reuters Limited 2000.