Technology / Semiconductor / Internet Research

Nicolas Baratte

Equity Bottom-Up

<ul>
<li>We’re going thru another iteration of the “AI peak” theory, driven by Hyperscalers’ declining Free Cash Flow. Coinciding with an “AI bubble” narrative, following the April-May stock rally.  </li>
<li>Stocks aren’t expensive. Semiconductors are trading at average PEx (17.7x forward EPS), Hyperscalers at -1 standard deviation (21.1x forward EPS). No valuations bubble. Expectations bubble? Consensus forecasts look reasonable.</li>
<li>Hyperscalers’ declining Free Cash Flows is true. Increasing Debt issuance is true. Also true: Cloud revenues are accelerating, margins are expanding. Most extraordinary is the increase in Remaining Performance Obligations.</li>
</ul>


We’re going thru another iteration of the “AI peak” theory, driven by Hyperscalers’ declining Free Cash Flow. Coinciding with an “AI bubble” narrative, following the April-May stock rally.  
Stocks aren’t expensive. Semiconductors are trading at average PEx (17.7x forward EPS), Hyperscalers at -1 standard deviation (21.1x forward EPS). No valuations bubble. Expectations bubble? Consensus forecasts look reasonable.
Hyperscalers’ declining Free Cash Flows is true. Increasing Debt issuance is true. Also true: Cloud revenues are accelerating, margins are expanding. Most extraordinary is the increase in Remaining Performance Obligations.


AI Is a Bubble, Again? Stocks Aren’t Expensive. Hyperscalers’ Future Revenue Tells a Different Story

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sk-hynix-inc" target="_blank" data-smartkarma-citation="entities:16955:1" rel="noopener">SK Hynix (000660 KS)</a> (SKH), a leading global memory producer, aims to raise over US$10bn via an ADR listing.</li>
<li>SKH has confidentially filed for an ADR issuance which could see it potentially launch a raising in July 2026, as per media reports.</li>
<li>In this note, we look at its past performance and other deal dynamics that might impact the listing.</li>
</ul>



SK Hynix (000660 KS) (SKH), a leading global memory producer, aims to raise over US$10bn via an ADR listing.
SKH has confidentially filed for an ADR issuance which could see it potentially launch a raising in July 2026, as per media reports.
In this note, we look at its past performance and other deal dynamics that might impact the listing.


Aequitas: SK Hynix ADR Listing - Part 1 - Early Look at the US$10-15bn Offering

Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

<ul>
<li>Global Unichip (3443 TT) is Taiwan's leading ASIC (application-specific integrated circuit) design-service company, with TSMC (2330 TT) as its largest shareholder.</li>
<li>GUC has become a leveraged play on US hyperscaler custom silicon. Cloud is now 81% of sales and the US 68%,</li>
<li>Management did not name its CPU customers, but the public record points firmly at Google.</li>
</ul>


Global Unichip (3443 TT) is Taiwan's leading ASIC (application-specific integrated circuit) design-service company, with TSMC (2330 TT) as its largest shareholder.
GUC has become a leveraged play on US hyperscaler custom silicon. Cloud is now 81% of sales and the US 68%,
Management did not name its CPU customers, but the public record points firmly at Google.


TechChain Insights Q&A: GUC's AI Boom Is Now a CPU Story, Testing the Next Bottleneck

<ul>
<li>
<a href="https://www.smartkarma.com/entities/space-exploration-technologies-corp-spacex" target="_blank" data-smartkarma-citation="entities:33284:1" rel="noopener">SpaceX (SPCX US)</a>, an Elon Musk led Space to AI company, aims to raise around US$75bn in its US IPO.</li>
<li>SpaceX is set to be the largest IPO ever. It will also probably end up being one of the most controversial ones given the asking valuations and other worldly promises.</li>
<li>In this note, we talk about the company background and its ground breaking space segment.</li>
</ul>



SpaceX (SPCX US), an Elon Musk led Space to AI company, aims to raise around US$75bn in its US IPO.
SpaceX is set to be the largest IPO ever. It will also probably end up being one of the most controversial ones given the asking valuations and other worldly promises.
In this note, we talk about the company background and its ground breaking space segment.


Aequitas: SpaceX IPO - Space - The Breakthrough Segment but with Low/No Growth

<ul>
<li>
<a href="https://www.smartkarma.com/entities/space-exploration-technologies-corp-spacex" target="_blank" data-smartkarma-citation="entities:33284:1" rel="noopener">SpaceX (SPCX US)</a>, an Elon Musk led Space to AI company, aims to raise around US$75bn in its US IPO.</li>
<li>SpaceX is set to be the largest IPO ever. It will also probably end up being one of the most controversial ones given the asking valuations and other worldly promises.</li>
<li>We will undertake our more serious analysis in the coming days. This note is a lighthearted look at some of the other worldly claims and Grok’s view on SpaceX valuation.</li>
</ul>



SpaceX (SPCX US), an Elon Musk led Space to AI company, aims to raise around US$75bn in its US IPO.
SpaceX is set to be the largest IPO ever. It will also probably end up being one of the most controversial ones given the asking valuations and other worldly promises.
We will undertake our more serious analysis in the coming days. This note is a lighthearted look at some of the other worldly claims and Grok’s view on SpaceX valuation.


Aequitas: SpaceX IPO- A Lighthearted Take on Some of the Claims - Grok Speaks the Truth on Valuation

United States

Alphabet, Inc. operates as a holding company. The Company, through its subsidiaries, provides web-based search, advertisements, maps, software applications, mobile operating systems, consumer content, enterprise solutions, commerce, and hardware products.

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Alphabet (GOOG US)

AI Is a Bubble, Again? Stocks Aren’t Expensive. Hyperscalers’ Future Revenue Tells a Different Story

AI peak theory revisited as Hyperscalers' declining Free Cash Flow sparks "AI bubble" narrative. Valuations not bubble, expectations not inflated....

Nicolas Baratte

Aequitas: SK Hynix ADR Listing - Part 1 - Early Look at the US$10-15bn Offering

SK Hynix (000660 KS) (SKH), a leading global memory producer, aims to raise over US$10bn via an ADR listing. As per media reports, it has filed...

Sumeet Singh

TechChain Insights Q&A: GUC's AI Boom Is Now a CPU Story, Testing the Next Bottleneck

Taiwan's Global Unichip is a key player in ASIC design, heavily tied to US hyperscaler custom silicon, with Google likely a major customer.

Vincent Fernando, CFA

Aequitas: SpaceX IPO - Space - The Breakthrough Segment but with Low/No Growth

SpaceX (SPCX US), an Elon Musk led Space to AI company, aims to raise around US$75bn in its US IPO. In this note, we look at its ground breaking...

Sumeet Singh

Aequitas: SpaceX IPO- A Lighthearted Take on Some of the Claims - Grok Speaks the Truth on Valuation

SpaceX (SPCX US), an Elon Musk led Space to AI company, aims to raise around US$75bn in its US IPO. This note is a lighthearted look at some of the...

Sumeet Singh

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

AI Is a Bubble, Again? Stocks Aren’t Expensive. Hyperscalers’ Future Revenue Tells a Different Story

​AI peak theory revisited as Hyperscalers' declining Free Cash Flow sparks "AI bubble" narrative. Valuations not bubble, expectations not inflated....

Nicolas Baratte

Aequitas: SK Hynix ADR Listing - Part 1 - Early Look at the US$10-15bn Offering

SK Hynix (000660 KS) (SKH), a leading global memory producer, aims to raise over US$10bn via an ADR listing. As per media reports, it has filed...

Sumeet Singh

TechChain Insights Q&A: GUC's AI Boom Is Now a CPU Story, Testing the Next Bottleneck

​Taiwan's Global Unichip is a key player in ASIC design, heavily tied to US hyperscaler custom silicon, with Google likely a major customer.

Vincent Fernando, CFA

Aequitas: SpaceX IPO - Space - The Breakthrough Segment but with Low/No Growth

SpaceX (SPCX US), an Elon Musk led Space to AI company, aims to raise around US$75bn in its US IPO. In this note, we look at its ground breaking...

Sumeet Singh

Aequitas: SpaceX IPO- A Lighthearted Take on Some of the Claims - Grok Speaks the Truth on Valuation

SpaceX (SPCX US), an Elon Musk led Space to AI company, aims to raise around US$75bn in its US IPO. This note is a lighthearted look at some of the...

Sumeet Singh

AI peak theory revisited as Hyperscalers' declining Free Cash Flow sparks "AI bubble" narrative. Valuations not bubble, expectations not inflated....

Taiwan's Global Unichip is a key player in ASIC design, heavily tied to US hyperscaler custom silicon, with Google likely a major customer.