Delta Electronics Inc’s (台達電) shares surpassed NT$900 for the first time yesterday, lifting its stock market value to the third-largest on the local main board, as the company’s power solutions and cooling products benefit from strong demand for artificial intelligence (AI) server power and data center infrastructure.
Shares of the leading provider of power electronics and thermal management solutions closed 2.14 percent higher at NT$907, a record high and valuing Delta at NT$2.36 trillion (US$78 billion), Taiwan Stock Exchange (TWSE) data showed.
The company’s market value was above handset chip designer MediaTek Inc’s (聯發科) NT$2.25 trillion, but behind iPhone assembler and AI server maker Hon Hai Precision Industry Co’s (鴻海) NT$3 trillion, TWSE data showed.
Photo: CNA
Taiwan Semiconductor Manufacturing Co (台積電), the world’s largest contract chipmaker, had a market cap of NT$33.58 trillion yesterday, still the most valuable company in Taiwan, the exchange’s data showed.
Delta is among several local companies in the power supply and heat dissipation sectors, including Lite-On Technology Corp (光寶科技) and Auras Technology Co (雙鴻科技), that have seen shares surge this year due to their rising exposure to the rapidly evolving AI server and data center markets.
“Delta’s good technology capability and well-established relationships with major clients could enable the company to better reap AI hardware growth than its peers,” S&P Global Ratings said in a statement in July.
As AI servers are becoming increasingly powerful and data centers consume huge amounts of electricity, the issues of power supply and heat dissipation have caught market attention, although challenges also arise from rapid changes in the power supply and thermal management for those applications, analysts said.
“Delta is benefiting from the clear centralized and high-voltage trend for power structures, accelerating liquid-cooling solution shipments, and continued market share gains,” Yuanta Securities Investment and Consulting Co (元大投顧) said in a note on Sept. 10.
Yuanta has set a 12-month target price of NT$1,050 for Delta, which has rallied 110.69 percent since the beginning of the year, outperforming the broader market’s 12.35 percent rise over the period, TWSE data showed.
Yuanta expects revenue contribution from AI-related components and related systems to reach NT$115.1 billion and account for 22 percent of Delta’s total revenue this year, from about 15 percent last year.
The figures are forecast to rise to NT$220.9 billion next year (34 percent of total revenue) and NT$367.8 billion in 2027 (45 percent of total revenue), the note said.
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