* Japan Display expects op loss in Q1, prices weak
* Sees pick up in U.S./Europe from Q2, China in H2
* Forecasts FY op profit 40 bln yen vs analysts' 57.38 bln (Adds details of forecasts for loss in Q1, recovery later in year)
TOKYO, May 15 (Reuters) - Japan Display Inc, the world's biggest maker of liquid crystal displays for smartphones, warned of a weak start to its business year and forecast a net loss seen for the half-year to September, but said rising orders from Chinese smartphone makers would fuel a full-year profit rise.
The supplier of Apple Inc iPhone screens has been hit by falling prices and delayed orders, contributing to its shares dropping more than a third from their offering price since they listed nearly two months ago.
"Ideally, we would offer goods at cost plus a certain margin, but that's not possible. To become a global player we have to decide how to lower costs based on the prices that customers bring to us," Chief Executive Shuichi Otsuka told media at a briefing after the results were announced.
It said a decline in revenue likely bottomed out in April, however, while the first quarter was likely to fall into an operating loss of more than 10 billion yen ($98.23 million).
The company said it expects a recovery from the second quarter on a rebound in shipments to Europe and the U.S. where client Apple, which it did not mention by name, is widely expected to launch its next-generation iPhone 6 in September. Media reports in Taiwan have said it could be released earlier than that.
Japan Display aims to boost shipments to China in the second half, when it is projecting a major improvement in operating profit. For the full year, it expects China revenue to nearly triple to 180 billion yen, or about one-fourth the total.
For the longer term, the company projected a steady shift to higher-resolution screens, its speciality market where it expects strong sales growth, particularly among Chinese brands whose handsets are rapidly becoming more sophisticated.
Japan Display forecast a 45 percent rise in operating profit for the 2014/15 business year to 40 billion yen, missing analyst estimates in its first earnings release since its $3.3 billion initial public offering in March.
The average expectation of 12 analysts was for operating profit of 57.4 billion yen, according to Thomson Reuters StarMine.
For the year ended on March 31, operating profit was 27.6 billion yen, meeting lowered guidance of 27.20 billion yen announced on April 28, when the company said declining prices had led to drawn out negotiations with clients and delayed orders.
Shares of Japan Display ended 1.7 percent lower at 589 yen ahead of the earnings release, slipping to a record closing low for a fourth consecutive session and underperforming a 0.8 percent decline in the benchmark Nikkei average. ($1 = 101.8050 Japanese Yen) (Reporting by Sophie Knight; Editing by Edmund Klamann and Christopher Cushing)