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Intel positive on PC growth in emerging Asia

Intel CEO Paul Otellini talks during the company's unveiling of its second generation Intel Core processor family during a news conference at the Consumer Electronics Show (CES) in Las Vegas January 5, 2011.


Intel Corp. is positive about growth in PC sales in emerging Asia, particularly in China and India, a top executive said on Friday, a day after the chip heavyweight posted market-beating revenue and margins for the fourth quarter.

Intel, whose microprocessors are the brains in the bulk of the world's PCs, also gave a rosy outlook for early 2011, defying worries about the company's minor role in the booming smartphone and tablet computer market.

"I look around and travel around and I see the emerging markets continuing to be quite good," Navin Shenoy, Intel's general manager for the Asia-Pacific region, told Reuters in a telephone interview.

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"Income levels are rising, PC costs are coming down and broadband continues to be built up," Shenoy said.

"In 1995 in China, it took about three years of income to buy a PC, but today only about seven weeks of income, and that's one of the fundamental reasons why we are bullish on the emerging markets."

Intel has opened its first chip plant in China in the northeastern city of Dalian late last year, in a move that gives it better proximity to serve regional customers.

In the fourth quarter alone, operations in Asia Pacific made up 57 per cent of Intel's total revenue, and revenue in the region grew 9 per cent from the same period a year earlier.

Shenoy declined to give growth forecasts but said he was "comfortable" with research firm IDC's forecast of a 14 per cent PC unit growth for the APAC area, excluding Japan, this year.

For 2010 as a whole, global PC shipments rose 13.6 per cent to 346.2 million units, IDC said, though expects growth in 2011 to be lower than its previous forecast of 10 per cent worldwide.

However, aside from Japan, investors in Asia were lukewarm to Intel's strong outlook, as worries linger over economic troubles in Europe and the United States.

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Around noon, shares of top contract chipmaker TSMC fell 0.3 per cent and PC vendor Acer dropped 0.7 per cent. South Korea's Samsung edged up 0.4 per cent, in line with the Korea composite index's gain.

In Japan, Tokyo Electron rose 2.8 per cent to 5,530 yen, Sumco added 2 per cent to 1,266 yen and Nikon Corp gained 0.7 per cent to 1,875 yen.

"We haven't seen a broader recovery in the tech sector and first quarter should be weak based on seasonal patterns," said Bevan Yeh, a fund manager at Prudential Financial Securities Investment Trust.

"Another concern in Taiwan is the impact on PC exporters from a strong Taiwan dollar," said Yeh, who declined to identify individual stocks in his portfolios.

Intel has recently introduced its next-generation microprocessors, code-named Sandy Bridge, which the company said will yield about a third of its corporate revenue in 2011 and help trigger more than $125-billion in sales for the personal computer industry.

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