TOKYO -- Global stocks tied to OLEDs are rising on the news that Apple will adopt the next-generation displays for upcoming iPhone models, though the gains are mainly concentrated in South Korea and Taiwan.
Reports have surfaced since the weekend indicating that new iPhones launching in the second half of 2018 will come with organic light-emitting diode panels. Armed with that information, investors have rushed to buy shares of OLED suppliers.
OLEDs are finding their way into other applications as well, such as auto apps. OLED deliveries are projected to climb more than 60% to $25.1 billion this year, according to British research firm IHS Markit.
The stocks of global production leaders in South Korea have been thriving. Samsung Electronics, which is strong in OLED panels for smartphones, has soared 36% this year. The shares climbed 1% on Tuesday, approaching the all-time high.
LG Display shares are up nearly 18% year to date, buoyed by the prospect that the company could fill orders that Samsung is unable to meet due to increased demand from Apple.
In Taiwan, panel maker Innolux's stock has surged 36% this year. Chinese rival BOE Technology Group is up 41%. The Beijing-based company is building a panel factory with subsidies from the local government.
The OLED boom is swaying benchmark markets in South Korea and Taiwan. The Korea Composite Stock Price Index has surged 18.2% this year and is near a record high. Samsung Electronics accounts for about a fifth of the index's total market capitalization, with LG Display also a heavy contributor. Stocks tied to OLEDs dominate the Taiwan Capitalization Weighted Stock Index, which has risen 12.6% in 2017.
"When it comes to entry into the OLED sector, there is a high technological barrier, so already-established producers will receive a sustained tailwind," said Yoshihiro Okumura, general manager at Chibagin Asset Management.