Shenzhen O-film Tech Co. Chairman Cai Rongjun has become a billionaire after shares in the Chinese touchscreen glass-panel maker soared almost 178 percent this year on higher demand for tablet computers.
Cai, 41, has a net worth of $1 billion after the stock advanced 10 percent yesterday, according to the Bloomberg Billionaires Index. He hasn’t appeared on any international wealth rankings. The bulk of his fortune consists of a 22 percent stake in the company, which supplies screens to Lenovo Group Ltd., Samsung Electronics Co. and Sony Corp.
Tablets have emerged as a primary avenue to tap the Internet following Apple’s iPad debut in April 2010. Samsung, Google Inc. and Amazon.com Inc. followed with their own devices and helped propel a 78 percent increase in shipments to 128 million units in 2012, according to Bloomberg Industries analysts George Mykytyn and Anand Srinivasan. Tablets now represent a third of all personal computers made, they said.
“Demand for large touchscreen displays is exploding, resulting in a huge gap between supply and demand,” Wei Xingyun, an analyst at Guotai Junan Securities wrote in a note to clients on March 12. He rates Shenzhen O-film stock “overweight.” “The company’s capacity expansion is set to boost full-year profit.”
Net income climbed to $52 million in 2012 from $3.4 million in 2011 as Cai expanded manufacturing while accumulating orders. Sales from touch screens for tablets and smartphones accounted for 90 percent of 2012 revenue of $638.6 million, up 216 percent from 2011, according to data compiled by Bloomberg.
Lenovo, its biggest customer, reported a 90 percent gain in fourth-quarter profit on May 23 after increasing its market share and boosting smartphone sales. Lenovo introduced touchscreen handsets in Russia, India, Indonesia, Vietnam and the Philippines last year following the debut of its first model in China in 2010. It plans to enter Africa next.
Cai graduated from Shantou University in Guangdong province, a school funded by Asia’s richest man Li Ka-Shing. He worked for Eastman Kodak Co. as a technician, engineer and manager between 1995 and 2001. In 2004, Cai and Hong Kong-based Yugao China Co., owned by his brother Cai Gaoxiao, acquired the predecessor of O-Film, according to a prospectus.
Shenzhen O-Film spokeswoman Cheng Xiaoli confirmed Cai’s shareholdings and declined to comment on his net worth calculation.
The Bloomberg Billionaires Index is a daily ranking of the world’s richest people. In calculating net worth, Bloomberg News strives to provide the most transparent calculations available. Each Bloomberg Billionaire profile contains a detailed analysis of how that person’s fortune is tallied.
The index is a dynamic measure of the world’s wealthy based on changes in markets, the economy and Bloomberg reporting. Each net worth figure is updated every business day at 5:30 p.m. in New York. Stakes in publicly traded companies are valued using the share’s most recent closing price. Valuations are converted to U.S. dollars at current exchange rates.
— With assistance by Michael Wei