Macquarie Capital Ltd has raised its 12-month target price for shares of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) by 10 percent to NT$385, up from NT$350, on the back of a positive long-term outlook for the chipmaker.
The new target price implies a 13.6 percent upside from the stock’s closing price of NT$339 in Taipei trading on Friday. TSMC shares have surged 50.33 percent this year.
The Australian brokerage said that TSMC is expected to report strong revenue in the first quarter of next year, driven by rising demand for chips made using its 7-nanometer (nm) process for Apple Inc’s iPhone 11 series and the iPhone SE 2.
The second quarter of next year would likely be a transition period to the next-generation iPhone — for which application processor shipments would start in the third quarter — becoming a potential low point for TSMC, Macquarie said in a research note on Friday.
However, the demand for application processors made using TSMC’s 5nm process technology for Apple’s next-generation iPhones and Huawei Technologies Co’s (華為) new Mate-series models is poised to serve as a new growth driver for the chipmaker in the second half of next year, it said.
“We expect TSMC’s revenue to grow 16 percent year-on-year in full-year 2020. TSMC’s 4Q20 revenue will likely be the peak again next year, following the normal pattern,” Macquarie analysts led by Patrick Liao (廖光河) wrote in the note.
TSMC last week reported that cumulative revenue for the first 11 months of this year rose 2.7 percent year-on-year to NT$966.67 billion (US$31.9 billion), which analysts attributed to solid demand for smartphone chips and high-performance computing chips.
Industry associations WSTS Inc and SEMI have predicted a recovery in the semiconductor market next year after a steep drop this year, while International Data Corp expects the consumer semiconductor segment to grow at a compound annual growth rate of 6.4 percent from last year to 2023 on rising demand for consumer Internet of Things devices and home-automation products.
As the 5G infrastructure development worldwide is progressing faster than expected, semiconductor companies are generally expected to benefit from increased semiconductor content value in high-end handsets, it said.
There is little doubt that TSMC’s advanced 5nm manufacturing process slated for next year will help it further secure its industry leadership and expand its market share, industry watchers have said.
“We estimate Apple will occupy from 85 to 90 percent of [TSMC’s] total 5nm capacity, and the rest will be assigned to new Huawei Mate models,” Macquarie analysts said.
For the second half of next year, TSMC’s revenue is forecast to increase 8 percent from the first half and 6 percent from a year earlier, mainly driven by Apple’s new iPhone models; Huawei’s 5G smartphones and 5G base station applications; MediaTek Inc’s (聯發科) 5G smartphone system-on-chip products; and Qualcomm Inc’s high-end 5G smartphones chips, they said.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
Taiwan’s food delivery market could undergo a major shift if Singapore-based Grab Holdings Ltd completes its planned acquisition of Delivery Hero SE’s Foodpanda business in Taiwan, industry experts said. Grab on Monday last week announced it would acquire Foodpanda’s Taiwan operations for US$600 million. The deal is expected to be finalized in the second half of this year, with Grab aiming to complete user migration to its platform by the first half of next year. A duopoly between Uber Eats and Foodpanda dominates Taiwan’s delivery market, a structure that has remained intact since the Fair Trade Commission (FTC) blocked Uber Technologies Inc’s
RSS