TES DISPLAYS EXPLORING YOUR VISION FPD MARKET HEADLINES: Overly high expectations in TFT-LCD. Expectations in the TFT-LCD sector were over l y hi gh and wi th Europe f ai l i ng t o l i ve up t o expectati ons, inventory ballooned, prices fell and production had to be scaled back. As we have done with LG Philips in Korea, we are lowering our earnings forecast for AUO (2409 TT - NT$43.8 - BUY) and CMO (3009 TT - NT$34.7 - BUY) as well as all the companies in the component chain, including Radiant (6176 TT - NT$50.7 - O-PF), Novatek (3034 TT - NT$146.5 - U-PF) and Wellypower (3080 TT - NT$144.5 - SELL). Although we are not expecting a loss in 2Q06 for the panel makers, the near breakeven forecast implies that a loss is on the cards, especially with fluctuation in currency expectations. Aggregate (29.1) (26.3) Handset earnings revisions Company Rec Net profit CLSA/Cons Target (TWD) 06CL 07CL 06CL 07CL Catcher Tech - 2474 TT

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