Embedded microprocessor intellectual property (IP) supplier Andes Technology Corp (晶心科技), a subsidiary of leading Taiwanese integrated circuit designer MediaTek Inc (聯發科), saw its shares soar on the company’s Taiwan Stock Exchange debut yesterday.
Buying was fueled by hopes that MediaTek would place more orders with the subsidiary, boosting its sales, while many investors have been attracted by the high profit margin enjoyed by the supplier, dealers said.
Andes shares rose 191.09 to close at NT$189.5 on the Taiwan Stock Exchange, whie the TAIEX ended up 0.48 at 9,744.21.
Shares soared about 107 percent from their issue price of NT$65.1 soon after the main board opened and continued to rise until the close of trading.
“Many investors chased Andes shares because of its rich parent — MediaTek — in the hope that Taiwan’s largest IC designer will continue to patronize its subsidiary,” Hua Nan Securities Co (華南永昌證券) analyst Kevin Su (蘇俊宏) said.
MediaTek chairman Tsai Ming-kai (蔡明介) is also chairman of Andes.
Apart from intellectual property used in communications chips, smartphone touch chips and storage chips, Andes said it also supplies products for the Internet of Things, automotive electronics and Internet equipment.
According to Andes, eight of the top 15 IC designers in Taiwan are its customers, with MediaTek being the largest, while three of the 10 leading IC design houses in South Korea are also placing orders.
Andes said it has secured orders from IC designers owned by large telecom operators and home-appliance firms in Japan and from Internet equipment suppliers in the US, with more than 165 sales contracts.
Andes said in its main board listing prospectus that it generated 66.37 percent of its sales in the domestic market and the remainder overseas.
The company is the fifth-largest intellectual property supplier in the world after ARM, Synopsys, Imagination and Cadence.
“Strong interest in Andes shares reflects its high profit margin, since an IP supplier has no need for production, but receives royalties on products it provides. I think the listing will prompt institutional investors to follow the shares,” Su said.
Andes said its gross margin is more than 98 percent.
Andes shares were previously traded on the emerging market from Aug. 6, 2015.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure