Taiwan-based touch panel maker Emerging Display Technologies (EDT) aims to double its capacity to equivalent of 1.2 million 3.5-inch touch panels in the first quarter of 2011 from current 600,000 units amid increasing demand, according to the company.

Equipment installation for the new capacity will be completed in the first quarter of 2011 and mass production is expected to begin at the end of the first quarter or the beginning of the second quarter, EDT added.

EDT has started shipping small volumes of 7-inch touch panels for MIDs (mobile Internet devices) to fulfill orders recently obtained from a US-based vendor and expects shipment volumes to expand in September.

EDT expects its touch panel supply to become tight in the fourth quarter when projected capacitive touch panel production reaches full utilization amid growing shipments of 7-inch applications, the company said.

Projected capacitive touch panels' share of revenues will reach 15% of EDT's total revenues in September, and exceed 20% in the fourth quarter, up from a single-digit share in the second quarter, EDT said.

EDT expects revenues in the third quarter to increase 10-20% as demand for niche products peaks. Demand from the US market for STN and small- to medium-size panel modules in July-August will also grow, EDT noted.

EDT turned profitable in the second quarter of 2010, with growing shipments of projected touch panels. Net profit for the third quarter is expected to exceed NT$44 million (US$1.377 million) with an EPS of over NT$0.24, the company added.