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

Equity Bottom-Up

<ul>
<li>MSFT's new AI features for Windows will need computers with at least 16GB of DRAM to run effectively. MSFT is asking manufacturers for this as a minimum for AI models.</li>
<li>MSFT announced Copilot Pro for individuals and small businesses last week. The desire to use generative AI and the minimum required DRAM will drive accelerated PC upgrades.</li>
<li>We note relative strength in 16GB DRAM prices; In Memory space, we continue to see relative value in SK Hynix, however, Nanya has the opportunity to Outperform in Taiwan.</li>
</ul>


MSFT's new AI features for Windows will need computers with at least 16GB of DRAM to run effectively. MSFT is asking manufacturers for this as a minimum for AI models.
MSFT announced Copilot Pro for individuals and small businesses last week. The desire to use generative AI and the minimum required DRAM will drive accelerated PC upgrades.
We note relative strength in 16GB DRAM prices; In Memory space, we continue to see relative value in SK Hynix, however, Nanya has the opportunity to Outperform in Taiwan.


Memory Monitor: Microsoft Copilot Will Supercharge Demand for DRAM; SK Hynix, Nanya Tech, Micron

Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Ingenuity

Our focus is exclusively on in-depth research & consulting in the broader semiconductor industry. We focus on the key players, namely Intel, Micron, Qualcomm, Apple, Samsung, NVIDIA, AMD, TSMC & Global Foundries - as well as some of the lesser known, but nonetheless critical, companies such as ASML (for EUV), Mellanox, Cavium, Xilinx etc. We specialise in their products, roadmaps, process technologies, competitive advantages & threats etc. We also help our clients understand the implications of new and emerging technologies, e.g. 3D X-Point, 3D NAND, Carbon Nanotubes, Autonomous Driving, Graphene, Silicon Photonics, Wafer-Level Optics, Artificial Intelligence, FPGA, GPU, ASIC etc. 

Semiconductor Analysis & Research

TSMC (Taiwan Semiconductor Manufacturing) / Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) (2330 TT)

TSMC (Taiwan Semiconductor Manufacturing)

<h2>Summary</h2>
<a href="https://www.smartkarma.com/entities/11230" target="_blank" data-smartkarma-citation="entities:11230:1"></a>
<a href="https://www.smartkarma.com/entities/11230" target="_blank" data-smartkarma-citation="entities:11230:1">Taiwan Semiconductor Mfg Co</a> has dominated the foundry segment over the past two decades. With revenues of $33 billion in 2017, the company had a 56% share of the foundry market and was over five times the size of its nearest competitor, Globalfoundries. Under the visionary leadership of Morris Chang, TSMC effectively invented the fabless model. Originally mocked by former AMD CEO Gerry Sanders who once famously quipped that “real men own fabs”, the fabless model has evolved into a thriving ecosystem, one which has facilitated the meteoric rise of some of the biggest names in the semiconductor segment including <a href="https://www.smartkarma.com/entities/666" target="_blank" data-smartkarma-citation="entities:666:1">Apple</a>, <a href="https://www.smartkarma.com/entities/969" target="_blank" data-smartkarma-citation="entities:969:1">Qualcomm </a>and <a href="https://www.smartkarma.com/entities/5891" target="_blank" data-smartkarma-citation="entities:5891:1">Nvidia</a>.  
TSMC’s success has been predicated upon the company's so-called Trinity of Strengths, namely process leadership, manufacturing excellence and customer trust. In today’s highly competitive foundry landscape, those strengths have never been more significant.
While the smartphone processor business has been central to TSMC's growth in recent years with Apple accounting for some 22% of revenues, the company is well positioned to diversify and benefit from high, secular growth trends in IoT, Automotive and AI acceleration. Even more significantly, TSMC is set to compete for the first time with Intel in the lucrative data center market by virtue of its role in manufacturing server chips for <a href="https://www.smartkarma.com/entities/19009" target="_blank" data-smartkarma-citation="entities:19009:1">Advanced Micro Devices</a> and a growing swathe of ARM-based server initiatives lead by none other than <a href="https://www.smartkarma.com/entities/409" target="_blank" data-smartkarma-citation="entities:409:1">Amazon</a>. 
Between 2006 and 2017, TSMC grew at a CAGR of 9.8% in NT$ terms, easily outpacing growth of both the broader semiconductor segment and its foundry peers. For the period 2019-2022, we model TSMC growing at a slightly lower CAGR of 8.36%, but nonetheless more than double the anticipated CAGR for the semiconductor segment as a whole.

Summary

Taiwan Semiconductor Mfg Co has dominated the foundry segment over the past two decades. With revenues of $33 billion in 2017, the company had a 56% share of the foundry market and was over five times the size of its nearest competitor, Globalfoundries. Under the visionary leadership of Morris Chang, TSMC effectively invented the fabless model. Originally mocked by former AMD CEO Gerry Sanders who once famously quipped that “real men own fabs”, the fabless model has evolved into a thriving ecosystem, one which has facilitated the meteoric rise of some of the biggest names in the semiconductor segment including Apple, Qualcomm and Nvidia.  
TSMC’s success has been predicated upon the company's so-called Trinity of Strengths, namely process leadership, manufacturing excellence and customer trust. In today’s highly competitive foundry landscape, those strengths have never been more significant.
While the smartphone processor business has been central to TSMC's growth in recent years with Apple accounting for some 22% of revenues, the company is well positioned to diversify and benefit from high, secular growth trends in IoT, Automotive and AI acceleration. Even more significantly, TSMC is set to compete for the first time with Intel in the lucrative data center market by virtue of its role in manufacturing server chips for Advanced Micro Devices and a growing swathe of ARM-based server initiatives lead by none other than Amazon. 
Between 2006 and 2017, TSMC grew at a CAGR of 9.8% in NT$ terms, easily outpacing growth of both the broader semiconductor segment and its foundry peers. For the period 2019-2022, we model TSMC growing at a slightly lower CAGR of 8.36%, but nonetheless more than double the anticipated CAGR for the semiconductor segment as a whole. 

A Bull Investment Case for TSMC (Summary Version)

TSMC (Taiwan Semiconductor Manufacturing) (TSM US)

<ul>
<li>We believe TSMC represents defensive exposure to AI for investors concerned that many other AI-related stocks' valuations may be too high.</li>
<li>While one may think TSMC seems too obvious as a play, we note that the stock is up only 4.5% over the last six months.</li>
<li>We view TSMC as trading at an inexpensive valuation; even a cheap valuation should our hypothesis that the stock is structurally re-rating upwards turn out to be true.</li>
</ul>


We believe TSMC represents defensive exposure to AI for investors concerned that many other AI-related stocks' valuations may be too high.
While one may think TSMC seems too obvious as a play, we note that the stock is up only 4.5% over the last six months.
We view TSMC as trading at an inexpensive valuation; even a cheap valuation should our hypothesis that the stock is structurally re-rating upwards turn out to be true.


TSMC: Defensive AI Play in Long Upward Re-Rating Trend?

Asia and Global Semiconductor and Tech Research

Andrew Lu

<ul>
<li>By offering 15k and 30k/m 3nm capacity by 4Q24/4Q25 to Intel, TSMC will see Intel becoming one of its top 3 customers by accounting for 12% of TSMC 2025 sales</li>
<li>By leveraging 3nm outsourcing, Intel will have incremental sales/capacity growth of 19-20% per year by accounting for 28%/44% of sales in 2024/2025, beating consensus' 14%/9% y/y sales growth for 2024/2025.</li>
<li>We estimate 30-35% 5 years EPS CAGR for Intel, driven by TSMC's 2/3nm foundry support, lower cost and process R&amp;D, lower capex and depreciation cost, and AI PC CPU launch.</li>
</ul>


By offering 15k and 30k/m 3nm capacity by 4Q24/4Q25 to Intel, TSMC will see Intel becoming one of its top 3 customers by accounting for 12% of TSMC 2025 sales
By leveraging 3nm outsourcing, Intel will have incremental sales/capacity growth of 19-20% per year by accounting for 28%/44% of sales in 2024/2025, beating consensus' 14%/9% y/y sales growth for 2024/2025.
We estimate 30-35% 5 years EPS CAGR for Intel, driven by TSMC's 2/3nm foundry support, lower cost and process R&amp;D, lower capex and depreciation cost, and AI PC CPU launch.


A Turnaround Story for Intel by Accelerating 3nm Outsourcing to TSMC?

Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

Shenton Research

Shenton Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Equity Capital Markets

Shenzhen Transsion Holdings / Equity Capital Markets

<ul>
<li>Transsion, a mobile phone maker focused on Africa and other emerging markets, raised HKD 2,968.0m (USD 378.2m) and will list on HKEX on Thursday, 15 Oct 2026.</li>
<li>In our previous notes, we looked at the company's fundamentals and the deal terms.</li>
<li>In this note, we provide an update for the IPO before its trading debut.</li>
</ul>


Transsion, a mobile phone maker focused on Africa and other emerging markets, raised HKD 2,968.0m (USD 378.2m) and will list on HKEX on Thursday, 15 Oct 2026.
In our previous notes, we looked at the company's fundamentals and the deal terms.
In this note, we provide an update for the IPO before its trading debut.


United States

Apple Inc. designs, manufactures, and markets smartphones, personal computers, tablets, wearables and accessories, and sells a variety of related accessories. The Company also offers payment, digital content, cloud and advertising services. Apple Inc.'s customers are primarily in consumer, small & mid-sized business, education, enterprise and government markets worldwide.

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Apple (AAPL US)

Memory Monitor: Microsoft Copilot Will Supercharge Demand for DRAM; SK Hynix, Nanya Tech, Micron

Microsoft's new AI features for Windows require a minimum of 16GB of DRAM, prompting accelerated PC upgrades and a pulling forward of the demand...

Vincent Fernando, CFA

A Bull Investment Case for TSMC (Summary Version)

As we approach the 5 year anniversary of this SK original on TSMC, I'm quite proud of the how the analysis it contains has stood the test of time....

William Keating

TSMC: Defensive AI Play in Long Upward Re-Rating Trend?

We view TSMC as trading at an inexpensive valuation; even a cheap valuation should our hypothesis that the stock is structurally re-rating upwards...

Vincent Fernando, CFA

A Turnaround Story for Intel by Accelerating 3nm Outsourcing to TSMC?

A Turnaround Story for Intel by Accelerating 3nm Outsourcing to TSMC? Intel needs TSMC foundry services more than TSMC needs Intel as a foundry...

Andrew Lu

Transsion (传音控股) A+H IPO Trading

Transsion raised USD 378m in net proceeds to list on HKEX on Thursday, 15 Oct 2026. We are cautious on debut performance given weak subscription.

Ke Yan, CFA, FRM

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Memory Monitor: Microsoft Copilot Will Supercharge Demand for DRAM; SK Hynix, Nanya Tech, Micron

​Microsoft's new AI features for Windows require a minimum of 16GB of DRAM, prompting accelerated PC upgrades and a pulling forward of the demand...

Vincent Fernando, CFA

A Bull Investment Case for TSMC (Summary Version)

As we approach the 5 year anniversary of this SK original on TSMC, I'm quite proud of the how the analysis it contains has stood the test of time....

William Keating

TSMC: Defensive AI Play in Long Upward Re-Rating Trend?

We view TSMC as trading at an inexpensive valuation; even a cheap valuation should our hypothesis that the stock is structurally re-rating upwards...

Vincent Fernando, CFA

A Turnaround Story for Intel by Accelerating 3nm Outsourcing to TSMC?

A Turnaround Story for Intel by Accelerating 3nm Outsourcing to TSMC? Intel needs TSMC foundry services more than TSMC needs Intel as a foundry...

Andrew Lu

Transsion (传音控股) A+H IPO Trading

Transsion raised USD 378m in net proceeds to list on HKEX on Thursday, 15 Oct 2026. We are cautious on debut performance given weak subscription.

Ke Yan, CFA, FRM

Microsoft's new AI features for Windows require a minimum of 16GB of DRAM, prompting accelerated PC upgrades and a pulling forward of the demand...