UPDATE 1-NEC Elec eyes return to profit by cutting costs

* Aims for profit this year vs consensus for loss

* Raises 2009/10 cost-cutting target by 50 pct

* CEO Nakajima to step down in June

* Shares end up 0.4 pct vs Nikkei's 0.2 pct rise

TOKYO, May 11 (Reuters) - Japanese chipmaker NEC Electronics Corp (6723.T) said on Monday it aims to return to profit this year as it cuts $916 million in fixed costs and demand for some chips starts to recover.

The global semiconductor sector has been battered by sharp price falls and sluggish demand, forcing NEC Electronics into a 68.4 billion yen operating loss in the year ended March and merger talks with domestic peer Renesas Technology. [ID:nT173048]

But makers' steep production cuts have helped stabilise prices, while NEC Electronics said demand for chips used in electronics such as TVs had started showing an uptick.

"There have been signs that inventory adjustments are not the only factor for the upturn in the market," Chief Executive Toshio Nakajima told a briefing.

NEC Electronics, owned 65 percent by NEC Corp (6701.T), officially forecasts it will break even on an operating basis in the year to March 2010, but said in a statement it would aim for a profit by reducing costs including capital spending and research expenses.

A poll of five analysts by Thomson Reuters shows a consensus for a 38.6 billion yen loss.

Its plan to cut 90 billion yen ($916 million) in costs is up by 30 billion yen from its previous target.

NEC Electronics also said Nakajima would step down in June, and Executive Vice President Junshi Yamaguchi would take the helm.

Before the announcement, shares of NEC Electronics closed up 0.4 percent, against a 0.2 percent rise in the benchmark Nikkei avearage .N225. (Reporting by Sachi Izumi; Editing by Chris Gallagher)