Apple New Product Launch Expected to Accelerate... "Positive for Component Suppliers' Stock Recovery"

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[Asia Economy Reporter Kum Boryeong] As Apple’s new product launches are expected to accelerate, it is anticipated that this will have a positive impact on the stock recovery of Apple’s component suppliers.

According to KB Securities on the 22nd, Apple began mass production of this year’s new products from mid-month, and new product launches are expected to be in full swing from early next month. Dongwon Kim, a researcher at KB Securities, explained, "Apple’s indefinite temporary closure of stores worldwide (except China) is expected to significantly alleviate market concerns that new product launches could be delayed by up to six months."

The fact that Apple’s new product launches are proceeding as planned is due to the number of confirmed COVID-19 cases in China peaking and then declining. With the return of workforce to production lines reportedly relatively smooth, the operating rate of Chinese factories is estimated to be 50% in February and 60% this month. Additionally, despite concerns over decreased demand due to COVID-19 and the temporary closure of Apple stores, it is analyzed that Apple has a strategy to absorb the waiting demand of its loyal customers through expanded online sales.

Researcher Kim stated, "Although production disruptions and sales declines due to COVID-19 are inevitable for Apple in the first half of this year, contrary to market concerns that new product launches could be delayed by 3 to 6 months, the possibility of new product launches in April and the expansion of online sales remain. Considering the demand tendencies of Apple’s loyal customers, it is estimated that some of the reduced demand in the first half will likely be deferred to the second half. Therefore, Apple’s new products released this year are expected to show a clear increase in demand as the year progresses, potentially exceeding expectations."

He added, "In particular, over the past two months, the stock prices of Apple’s component suppliers have plummeted by an average of 45.0% due to concerns over delays in new product launches caused by the spread of COVID-19. However, the launch of Apple’s new products in the first half of the year is expected to have a positive impact on improving investment sentiment and stock recovery for Apple component suppliers such as Samsung Electronics, LG Innotek, ITM Semiconductor, and BH."

This content was produced with the assistance of AI translation services.