In an effort to maintain smartphone panel orders from Xiaomi as price competition in the market intensifies, Sharp is expected to drop pricing another 20-30% in 2015, according to reports from Japan-based Nikkei News.

The paper quoted sources as attributing Sharp's move due to its declining LCD panel business as a result of high costs and lagging technology compared with competitors such as Japan Display.

Vendors such as Xiaomi have since opted for new suppliers. Sharp supplied a reported 60% of Xiaomi's handset panels throughout July-September 2014 but that number dropped significantly in November as Xiaomi shifted orders away.

Sharp is said to have supplied panels for about US$30 and will now drop pricing by as much as 30% in order to sustain orders, the report said.

However, Sharp may still see orders decline as Xiaomi furthers discussions over increased cooperation with Japan Display, the report added.