The Free Cash Flow Compositions of Touch Panel Industry andTheir Impact Factors

• Main Authors: Li-Chun Lee, 李麗君
• Other Authors: Jen-Tsung Huang
• Format: Others
• Language: zh-TW
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/7x7g8p

碩士 === 國立中山大學 === 財務管理學系研究所 === 102 === Apple Smart Phone has rapidly swept the globe market since Apple launched iPhone series, and raised a wave of touch panels. Under the circumstance that consumer electronics applications have continually increased, the user-friendly touch panel technology gradually expanded from the phone to various kinds of accessories of display applications, such as handheld games, e-books, tablet PCs and multimedia broadcasting and other consumer electronics fields, which led to the great opportunities for global touch panel market. There are more and more companies join to this touch panel production line; upstream and downstream manufacturers invest a lot of capital to share this touch panel market. Taiwan has long been dominated by the foundry and manufacturing industry and its remarkable feature is capital-intensive. "Electronics industry" is the most one; capital has always been a major lifeline of development for enterprise. Therefore, companies often raise their funds through open market in order to maintaining the advantages for business with sustainable management and long-term competitiveness. Hence, the cash flow of enterprises will be significantly important; within the free cash flow, capital expenditure is regarded as a measure index for business expansion in the future, from which we realize that there are certain influence of capital expenditure on the free cash flow. Thus, "what is the business performance for enterprise on capital expenditure?" This is the core issue of this study we would like to discuss. Within the related domestic and international documents for discussing the influence of enterprise increased the capital expenditure on business performance, the empirical represents both positive and negative significant impacts; Within the related domestic and international documents for discussing the free cash flow, the empirical mostly shows that the over-investment will reduce the value of the company and damage the interests of shareholders; also there are some documents consider that operating capital could not deal with capital expenditure. Accordingly, the influence of capital expenditures on the free cash flow is worth to be researched. In this study, we take listed touch panel industry (TP industry) in Taiwan from year 2009 to 2012 as research examples. We expect that through this study, we will understand the factors for impacting the free cash flow of enterprise and the relationship between capital expenditures and the free cash flow. Moreover, to discuss whether the cash flow from operating activities of enterprise is able to deal with the capital expenditures in the future, from which we will observe the operating performance between different sub-industries. There are some empirical results as followings: 1. The main factor for impacting free cash flow is capital expenditure and operating capital increment; 2. The total investment capital of the whole touch panel industry could not create the operating profit; 3. From the aspect of each sub-industry performance, FPC industry has the best performance in the competition; the panel industry has the best performance in return on investment; touch IC has the best performance in company’s differences;.4. For the part of examining whether the cash flow from operating activities is able to deal with its cash expenditures of investment, there are 11 companies under 45-Degree Line, showing that its cash flow from operating activities is not able to deal with its cash expenditures of investment. As the result, the hypothesis in this study is untenable. This result suggests that there are no certain consequences for more investment will gain the better profits. This also means that enterprises must rely on financing if they undertake the major investment.