Powerchip shares hit 1-month low after record loss

TAIPEI, Oct 22 (Reuters) - Shares of Powerchip Semiconductor Corp (5346.TWO), Taiwan's top DRAM chip maker, fell more than 3 percent to a one-month low on Wednesday, a day after the company posted a record quarterly loss that was worse than forecast. At about noon, Powerchip shares had slid 3.4 percent to T$4.61, underperforming the main TAIEX's 1.4 percent fall.

Shares of its smaller rival Nanya Technology (2408.TW) dropped 2.6 percent, ahead of its quarterly results later in the day.

Powerchip, which makes dynamic random access memory (DRAM) chips used in personal computers, booked a net loss of T$15 billion ($456 million) for the quarter ended September.

It allocates T$10 billion for capital spending next year, only half of its 2008 budget. ([ID:nTP278265])

"We lower 2008, 2009 and 2010 EPS estimates on weaker revenue and margin assumptions reflecting weak DRAM market conditions," Morgan Stanley wrote in a research report on Wednesday.

Morgan Stanley said Powerchip's 2008 loss would widen to T$5.46 per share from its previous estimate of a T$4.43 loss per share. Its 2009 loss would widen to T$2.08 per share from the previous T$1.67 loss per share.

Morgan Stanley now expects Powerchip to earn T$0.96 per share in 2010, down from its previous estimate of a T$1.49 profit per share. (US$1=T$32.9) (Reporting by Baker Li, Editing by Ken Wills)