At a shareholders' conference held late September, B.J. Lee, chairman of LED chipmaker Epistar Inc., estimated 2013 would remain a tough year for the LED industry as a whole, constraining the manufacturers' revenue climbing at least until 2014.

He projected most of the manufacturers to maintain 2013 revenues at their 2012 levels at the best.

Lee, whose company is currently the world's No.1 producer of blue LED chips by volume, felt that overcapacity will still haunt LED backlight suppliers into 2013, at which time he estimated LED penetration on backlight market would hit peak.

LED's lighting applications, he projected, will not expand further until 2014 and will be comparable to backlight applications in 2015 in terms of market share. He estimated consumption volume of LED light bulbs would increase at 70% year on year over the next three years. But price will drop at annual rate of 40%, confining industrial revenue growth at 20-30% range.

For the second half of this year, the company has a bright outlook. In July and August respectively, the company had high revenue of approximately NT$1.7 billion (US$56 million at US$1:NT$30) mostly thanks to orders built up for mainland China's weeklong holidays observed for the Oct. 1 National Day. October is normally the month for dealing with orders replenished for Chinese New Year shopping season.

In response to shareholders' backlash about the company's full acquisition of the money-losing Huga Optotech Inc. Lee pointed out that Huga is expected to break even in the third quarter next year. The acquisition, he stressed, will make up for Epistar's capacity shortage.