Shares of Apple Inc reorganized on Monday after Wall Street brushed off the shock of the explosion last week that shut down a Foxconn factory in China producing its popular iPad.
Work at the Hon Hai Precision plant in Chengdu, a city in south-west China, was suspended by Foxconn Technology Group, Apple's biggest manufacturing partner, after three workers were killed in a Friday blast due to combustible dust in a duct.
The impact, however, should be nominal because of Foxconn's ability to quickly shift output elsewhere in its extensive network, investors and analysts said.
Apple’s share closed down to 0.24 per cent at $334.40 after slipping to 1.7 per cent in the morning trade.
Channing Smith, Managing Director at Capital Advisors Growth Fund, which owns Apple shares, said the situation was in control and it reflected in the nominal decline of share price.
According to iSuppli, a market research firm, Foxconn’s Shenzen plant may not be able to make up for the Chengdu loss. The firm expects 704 million iPad 2s to be shipped in the second quarter. The Shenzen plant is mainly an assembly plant for iPad 2.
The Shenzhen plant has the ability to produce 7.5 million units during the quarter and so tablet shipments could fall short of anticipated levels between 300,000 and 600,000 units, the research firm said.
Apple retailed 4.69 million iPads last quarter and is finding it hard to meet the overwhelming demand and is being tagged as backlog by the company executives.
Meanwhile, investors in Hon Hai are worried about the fallout of the blast on the electronics supplier which has created a pressure situation on the firm.
The industry, however, plans to resume operation at the Chengdu plant after it completes an investigation. No date has been given.