UPDATE 1-Microstar eyes Q2 pft, strong laptop growth

* Microstar aims for profitability in Q2

* Company sees laptop shipments climbing 20-30 pct in 2009

* Aims to be among top 10 PC brands by 2010

(Adds details, quotes)

By Roger Tung

TAIPEI, May 14 (Reuters) - Taiwan portable PC brand Microstar (2377.TW) will return to profitability in the current quarter, its chairman said on Thursday, the latest sign that the technology sector was headed for recovery.

Company Chairman Joseph Hsu said he expected notebook shipments to climb 20-30 percent in 2009 from the 3 million units the company shipped last year, as consumer appetites for tech buys improved.

"We'll definitely return to profit in the second quarter," Hsu told Reuters on the sidelines of a product launch.

"Inventory issues have been largely ironed out, and we've already been pushing out some new products," said Hsu, whose company booked a net loss of T$543 million ($16.5 million) for the first quarter.

Hsu did not give dollar estimates but he said he wanted the company, which sells PCs under the MSI brand name, to be among the top 10 PC vendors by 2010.

Microstar began life as a contract manufacturer of motherboards, a business it still pursues, but has been scaling back on its work there as it enters the branded business, which offers higher profit margins.

"We were in the top three in many of the countries we operated in when we were a contract manufacturer," Hsu said.

"We're banking on that to carry us into the notebook market."

The company competes with bigger rivals Hon Hai (2317.TW) and Singapore-based Flextronics (FLEX.O) in the contract manufacturing business, and with PC vendors such as Asustek (2357.TW) and Acer (2353.TW) in the branded business.

Its forecast ise faster than data tracking firm IDC's outlook for the sector. IDC expects shipments of portable PCs to climb 4 percent this year from 2008.

Index compiler MSCI Barra will include Microstar in its Taiwan Index .MSCITW from May 29, a move that could prompt buying of its stock by managed funds that track the index.