Shares of Sharp gained as much as 11 percent to 165 yen in early trading, their biggest one-day gain in almost two months, after local media earlier reported the increase in production capacity.
Sharp is seeking supply agreements with ultrabook makers Lenovo Group, Dell Inc and Hewlett-Packard, Kyodo news agency reported.
The Japanese company, which secured $4.6 billion in emergency loans from its banks in September, this month began producing IGZO screens at a liquid crystal display factory in Nara prefecture western Japan, Sharp spokeswoman Miyuki Nakayama confirmed.
"We are starting in two different plants. The volume is increased," she said.
Sharp already makes IGZO displays that it supplies for Apple Inc's iPad tablet at its Kameyama plant. The facility also makes screens for the iPhone 5.
Sharp says IGZO, which consume 10 percent to 20 percent of the power required by conventional panels, may be better suited for ultrabooks. Needing less backlighting, IGZO screens are also thinner than conventional LCD displays.
Intel is promoting ultrabooks to counter tablet computers from Apple. Earlier this year, the U.S. chipmaker signed deals with several panel makers to ensure adequate supplies for a wave of ultrabooks with touch screens expected to hit the market following Microsoft Corp's launch of Windows 8 this month.
© Thomson Reuters 2012
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