* Q1 net profit T$7.27 bln vs T$20.2 bln loss year ago
* Market estimates pegged profit at T$3.6 billion
* New PC, TV models set to spur new display demand
* Stock up 1 pct before results (Adds comments)
TAIPEI, April 22 (Reuters) - AU Optronics Corp 2409.TW, Taiwan's No.2 LCD maker, returned to profit in the first quarter after strong demand boosted sales and prices of its displays for computers and flat-screen TVs.
The outlook is bright for AU Optronics' AUO.N as new laptops and thinner TV models with power-saving backlights sell well worldwide.
Major LCD makers in Asia have reported brisk demand recently as economies recover, with China leading the way. However concerns have grown the sector might be saddled with oversupply if display makers aggressively ramp up output.
“Although the first quarter was the traditional low season, we have seen relative stable panel prices thanks to recovering global demand and healthy inventory levels in the channel,” AU CFO Andy Yang said in a statement on Thursday.
South Korea's LG Display 034220.KS, the world's No.2 LCD maker, is set to report later on Thursday an operating profit of 604 billion won ($544 million) in January-March versus a deep loss a year ago and up 70 percent from the previous quarter, according to Thomson Reuters I/B/E/S.
That compared with a net loss of T$20.2 billion a year ago and a net loss of T$7.9 billion in the last quarter of 2009. AU was expected to report a first-quarter net profit of T$3.6 billion, according to the consensus forecast by Thomson Reuters I/B/E/S.
Newly merged Chimei Innolux 3481.TW, which overtook AU as Taiwan's No.1 and the world's No.3 LCD maker in March, is set to report quarterly earnings later this month.
Before the results, AU's Taipei-listed shares rose 0.97 percent, while the main TAIEX index .TWII lost 0.15 percent.
So far this year, the stock has fallen about 10 percent on worries over weaker panel prices in the traditional slow season in the second quarter. The TAIEX lost 3.5 percent in the same period. (US$1=T$31.4) (Reporting by Baker Li, Editing by Anshuman Daga)
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