HTC <2498.TW>, the world's No.4 smartphone maker, plunged by its daily 7 percent maximum limit on Monday after it unexpectedly slashed its revenue forecast for this year.

At 0118 GMT, HTC was down 7 percent at T$372.50 ($11.39), dragging the benchmark TAIEX share index <.TWII> down 0.30 percent, while the electronics sub-index <.TELI> declined 0.76 percent.

Many analysts including Merrill Lynch, Nomura, JP Morgan and Citi downgraded the company after it gave the weak outlook, saying they did not expect any recovery in the short term.

We expect the company's operating profit margin to fall up to next year at least, which will further pressure profitability and make it look even less attractive, said Vincent Chen, an analyst at Yuanta Securities, which has a sell rating on the company.

HTC is competing against some of the biggest names in the industry, and it hasn't done enough to build on its brand awareness.

HTC said on Friday that revenue this year could fall by a low to mid-single-digit percent, severely lagging growth in the overall smartphone sector, which some analysts expect to grow by up to 30 percent.

The smartphone sector has grown increasingly competitive in recent months as PC makers such as Acer <2353.TW> enter a sector already crowded with industry titans Nokia , Blackberry maker Research in Motion and iPhone maker Apple .

(Reporting by Kelvin Soh; Editing by Chris Lewis)