The company declined to confirm the report but said it was constantly pursuing opportunities to strengthen its competitiveness, including building a new plant.
"No formal decision has been made regarding any matter that we need to disclose," it added in a statement.
The proposed plant in Ishikawa, central Japan, would start operations in 2016 and is expected to produce panels mainly for Apple but also for other companies, the paper said without disclosing its sources.
The news sent shares in Japan Display to as high as 528 yen in early Tokyo trade, up 14 percent, before they retreated to 501 yen by 0214 GMT.