Asia and Global Semiconductor and Tech Research

Andrew Lu

Equity Bottom-Up

<h2>What's new?</h2>Economic Daily reports today that <a href="https://www.smartkarma.com/entities/969" target="_blank" data-smartkarma-citation="entities:969">Qualcomm Inc (QCOM US)</a> is lowering its upcoming mid-end version smartphone SoC Snapdragon 450 price by 30% to US$10.0-10.5 before <a href="https://www.smartkarma.com/entities/772" target="_blank" data-smartkarma-citation="entities:772">Mediatek Inc (2454 TT)</a> introduction of P23 and P30 in 4Q17. To match the price cut from Qualcomm, MediaTek needs to cut its P23 price by 33-39% to US$8 from earlier planned US$12-13. Also, according to the news, <a href="https://www.smartkarma.com/entities/11230" target="_blank" data-smartkarma-citation="entities:11230">Taiwan Semiconductor Mfg. Co. Ltd. (2330 TT)</a> is priced at US$7,000 per wafer on 16nm for P23 vs. <a href="https://www.smartkarma.com/entities/191" target="_blank" data-smartkarma-citation="entities:191">Samsung</a>…

What's new?Economic Daily reports today that Qualcomm Inc (QCOM US) is lowering its upcoming mid-end version smartphone SoC Snapdragon 450 price by 30% to US$10.0-10.5 before Mediatek Inc (2454 TT) introduction of P23 and P30 in 4Q17. To match the price cut from Qualcomm, MediaTek needs to cut its P23 price by 33-39% to US$8 from earlier planned US$12-13. Also, according to the news, Taiwan Semiconductor Mfg. Co. Ltd. (2330 TT) is priced at US$7,000 per wafer on 16nm for P23 vs. Samsung…

Can MediaTek Keep Its Margin Promise if Qualcomm Is Cutting the Price by 30%? Cost Cut Coming

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

MSCI Emerging Markets Index / Technical Analysis

In the attached strategy document we expand upon themes and opportunities in materials, technology and financials as well as an overview of opportunities in EM, Europe, and Japan.Emerging Markets: Breaking out to all-time highs, EM is unfolding as global leadership. Take advantage of pullbacks.Europe: Two words: pullback opportunity. For the past three months, Europe peeled back from the global advance, as prices diverged from bullish headlines. We view this as a welcomed event. Long-term technicals do confirm the improving headlines, but timing matters. And the STOXX 600’s test of the 200-day MA represents a timely entry point.  Just note, Europe is not a relative leader. That status belongs to EM (above).Japan: Japan represents an overlooked opportunity. With EM leading, and Europe crowding headlines, Japan is steadily emerging from a two-year base pattern, setting the stage for another leg higher

In the attached strategy document we expand upon themes and opportunities in materials, technology and financials as well as an overview of opportunities in EM, Europe, and Japan.Emerging Markets: Breaking out to all-time highs, EM is unfolding as global leadership. Take advantage of pullbacks.Europe: Two words: pullback opportunity. For the past three months, Europe peeled back from the global advance, as prices diverged from bullish headlines. We view this as a welcomed event. Long-term technicals do confirm the improving headlines, but timing matters. And the STOXX 600’s test of the 200-day MA represents a timely entry point.  Just note, Europe is not a relative leader. That status belongs to EM (above).Japan: Japan represents an overlooked opportunity. With EM leading, and Europe crowding headlines, Japan is steadily emerging from a two-year base pattern, setting the stage for another leg higher

Global Equity Strategy: Overweight EM, Pullback Opportunities in Europe, Japan Poised to Breakout

<h2>Summary</h2><ul>
<li>Spreadtrum is back to the game: Spreadtrum unveiled SC9853I based on Intel's 14nm foundry process, 1.8Ghz Octa-Airmont-core and supports 4G LTE Cat-7 downlink (300Mbps) and Cat-13 uplink (150Mbps) for 5-mode communication standard. </li>
<li>Are these negative to MediaTek and Qualcomm? We would agree on Spreadtrum/RDA back to the game by leveraging Intel CPU/GPU/baseband cores and 14nm Production as a short-term negative to MediaTek and Qualcomm in term of market share and pricing competitions.</li>
<li>
Why…</li>
</ul>

Summary
Spreadtrum is back to the game: Spreadtrum unveiled SC9853I based on Intel's 14nm foundry process, 1.8Ghz Octa-Airmont-core and supports 4G LTE Cat-7 downlink (300Mbps) and Cat-13 uplink (150Mbps) for 5-mode communication standard. 
Are these negative to MediaTek and Qualcomm? We would agree on Spreadtrum/RDA back to the game by leveraging Intel CPU/GPU/baseband cores and 14nm Production as a short-term negative to MediaTek and Qualcomm in term of market share and pricing competitions.

Why…


Spreadtrum Is Back to the Game by Leveraging Intel IPs and Production; Negative to MediaTek?

Macro & Asian equity Technical Strategies, BBSP Asia

Federico D'Inca

Macro & Asian equity Technical Strategies

BBSP Asia

Long Term Allocation (Strategic view) in terms of Relative Value (vs MXAP) and in USD terms. • NIKKEI/MXAP: Long term outperformance still expected. • ASX/MXAP: Outperformance expected holding above long-term support (from 2003). • TWSE/MXAP: Neutral at the moment, watching closely a key level (2.22) to surpass to confirm TWSE long term outperformance vs MXAP. • KOSPI/MXAP: Long term outperformance in progress/still expected. • HSI/MXAP: Long term outperformance in progress/still expected. •…

Long Term Allocation (Strategic view) in terms of Relative Value (vs MXAP) and in USD terms. • NIKKEI/MXAP: Long term outperformance still expected. • ASX/MXAP: Outperformance expected holding above long-term support (from 2003). • TWSE/MXAP: Neutral at the moment, watching closely a key level (2.22) to surpass to confirm TWSE long term outperformance vs MXAP.  • KOSPI/MXAP: Long term outperformance in progress/still expected. • HSI/MXAP: Long term outperformance in progress/still expected. •…

BBSP Equity Asia Weekly Research 10 August 2017

Semiconductor Manufacturing International Corp (SMIC) / Equity Bottom-Up

Semiconductor Manufacturing International Corp (SMIC)

<h2>Another major miss in 3Q17</h2>After a small miss in 2Q17 numbers (please see our earlier report "<a href="https://www.smartkarma.com/insights/terrible-miss-in-2q17-to-drive-more-downgrades-the-change-of-ceo-means-a-change-of-strategy" target="_blank" data-smartkarma-citation="insights:10625">Terrible Miss in 2Q17 to Drive More Downgrades; The Change of CEO Means a Change of Strategy?</a> dated 10 May 2017), <a href="https://www.smartkarma.com/entities/14231" target="_blank" data-smartkarma-citation="entities:14231:1">Semiconductor Manufacturing (981 HK)</a> guided 3Q17 sales growth of 0-3% q/q (vs. Bloomberg consensus' 13% q/q growth) together with 4ppts miss on the gross margin and 10ppts miss on operating margin guidance. We thus expect coverage analysts to cut their 3Q17 earnings estimates sharply to a…

Another major miss in 3Q17After a small miss in 2Q17 numbers (please see our earlier report "Terrible Miss in 2Q17 to Drive More Downgrades; The Change of CEO Means a Change of Strategy? dated 10 May 2017), Semiconductor Manufacturing (981 HK) guided 3Q17 sales growth of 0-3% q/q (vs. Bloomberg consensus' 13% q/q growth) together with 4ppts miss on the gross margin and 10ppts miss on operating margin guidance. We thus expect coverage analysts to cut their 3Q17 earnings estimates sharply to a…

SMIC Guides Another Miss- Heavy Capex Seems Not Turning into Sales and Profits

Taiwan

MediaTek Inc. is a fabless semiconductor company for wireless communications and digital multimedia solutions. The company provides SOC system solutions for wireless communications, high-definition TV, optical storage, DVD and Blu-ray products.

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Mediatek Inc (2454 TT)

Can MediaTek Keep Its Margin Promise if Qualcomm Is Cutting the Price by 30%? Cost Cut Coming

What's new?Economic Daily reports today that Qualcomm Inc (QCOM US) is lowering its upcoming mid-end version smartphone SoC Snapdragon 450 price by...

Andrew Lu

Global Equity Strategy: Overweight EM, Pullback Opportunities in Europe, Japan Poised to Breakout

In the attached strategy document we expand upon themes and opportunities in materials, technology and financials as well as an overview of...

Vermilion Research

Spreadtrum Is Back to the Game by Leveraging Intel IPs and Production; Negative to MediaTek?

Summary Spreadtrum is back to the game: Spreadtrum unveiled SC9853I based on Intel's 14nm foundry process, 1.8Ghz Octa-Airmont-core and supports 4G...

Andrew Lu

BBSP Equity Asia Weekly Research 10 August 2017

Long Term Allocation (Strategic view) in terms of Relative Value (vs MXAP) and in USD terms.• NIKKEI/MXAP: Long term outperformance still...

BBSP Asia

SMIC Guides Another Miss- Heavy Capex Seems Not Turning into Sales and Profits

Another major miss in 3Q17After a small miss in 2Q17 numbers (please see our earlier report "Terrible Miss in 2Q17 to Drive More Downgrades; The...

Andrew Lu

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