Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) shares rose 2.66 percent to close at a record high of NT$1,005 yesterday. as investors expect the company to continue benefiting from strong demand for artificial intelligence (AI) and high-performance computing (HPC) chips.
TSMC is the 19th member of the local bourse’s NT$1,000 stock club, which includes smartphone chip designer MediaTek Inc (聯發科) and electric transformer manufacturer Fortune Electric Co (華城電機).
Yesterday’s rally swelled TSMC’s market capitalization to NT$26.06 trillion (US$802.3 billion) and contributed about 211 points to the TAIEX, which closed up 350.1 points, or 1.51 percent, to 23,522.53, another record high, Taiwan Stock Exchange data showed.
Photo: CNA
TSMC has this year surged 69.48 percent, making it the most valuable stock on the local bourse and the world’s No. 10 company in terms of market capitalization.
The market expects TSMC to issue a positive report during its upcoming earnings conference, which helped boost the company’s share price to a record high yesterday, Mega International Investment Trust Co (兆豐國際投顧) analyst Alex Huang (黃國偉) said.
The chipmaker’s subsequent performance would continue to affect the trajectory of Taiwan’s stock market, Huang added.
While TSMC’s cutting-edge technology and valuation are making it a favorite play among global investors, the company has also benefited from being the main advanced-chip supplier of Nvidia Corp.
TSMC is expected to guide for a quarterly revenue growth of more than 10 percent for the next quarter at its earnings conference on July 18, thanks to stronger-than-expected demand for advanced chips amid the AI boom, analysts have said.
The company is also forecast to increase capital spending next year to between US$32 billion and US$36 billion, compared with this year’s US$28 billion to US$32 billion, analysts said.
UBS Group AG this week raised its full-year capital expenditure estimates for TSMC to US$32 billion this year and US$37 billion next year, citing increasing demand from generative AI and recovering margins on the back of cutting-edge technology.
TSMC in April told investors that this year would be a “healthy growth year” for the chipmaker, supported by its technology leadership and a broad customer base.
Revenue would expand by a low to mid-20 percent year-on-year this year, with the second half to outperform the first half, it said.
Additional reporting by CNA and Bloomberg
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