UPDATE 1-Samsung Elec cautious on semiconductor outlook

* Says semiconductor sector has outperformed own expectations

* Sees shortage of high-end DDR3 DRAM chips used in PCs

* Declines comment on possible Hynix stake buy

* Shares up more than 3 pct, beating main board

TAIPEI, Sept 22 - Samsung Electronics <005930.KS>, the world's biggest maker of memory chips, said on Tuesday it remains cautious about the semiconductor sector's outlook even as the industry emerges from its two-year slump.

"The semiconductor sector is now performing better than our own expectations because of government help," said Kwon Oh-hyun, head of the South Korean company's semiconductor business,.

"However, we remain cautious about things and are looking to Thanksgiving for a turning point," he said, without elaborating if he was expecting an improvement or a decline in the sector.

Thanksgiving falls in November in the United States and in October in Canada.

Kwon was speaking at the firm's annual mobile solutions forum in Taipei.

By 0452 GMT, Samsung shares were up over 3 percent, outperforming a 1.23 percent advance on the benchmark Kospi <.KSII> share index.

Kwon also said he expects the current shortage of high-end DDR3 chips used in many PCs and other electronic devices to be resolved in the short term, but declined to say if he was expecting a hike in DRAM chip prices.

"Higher chip prices will be good for DRAM makers, but that'll be bad for our clients. The best thing right now is for prices to stabilise," Kwon said.

On the spot market, the average selling price of a 1-gigabit double data rate 2 (DDR2) memory chip that runs at 800 megahertz has risen about two-thirds in the past three months, according to chip price tracker DRAMeXchange.

The price of 1-gigabit DDR3 chips, which can handle data faster than the current mainstream DDR2 chip, has risen about a third in the same period, DRAMeXchange data showed.

When asked if Samsung was interested in taking over Hynix <000660.KS>, the world's No. 2 maker of memory chips, Kwon declined to comment.

Major shareholders for Hynix Semiconductor Inc have started the sale process for a $2.75 billion stake in the memory chip maker and are planning to pick a preferred buyer by the end of this year.

In July, Samsung Electronics, which also makes LCD screens and sells mobile phones and TVs carrying its own name, posted its best quarterly profit in 2-½ years. [ID:nSEO372304]