Taiwan Tech Focused Senior Analyst

Patrick Liao

Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) - ADR / Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) - ADR

<ul>
<li>The US-China trade war has shaped a new trend: Advanced and Matured Technologies led by <a href="https://www.smartkarma.com/entities/taiwan-semiconductor-sp-adr" target="_blank" data-smartkarma-citation="entities:8587:1" rel="noopener">Taiwan Semiconductor (TSMC) - ADR (TSM US)</a> and <a href="https://www.smartkarma.com/entities/semiconductor-manufacturing-international-corp-smic" target="_blank" data-smartkarma-citation="entities:14231:1" rel="noopener">Semiconductor Manufacturing International Corp (SMIC) (981 HK)</a> respectively.</li>
<li>Notably, construction of semiconductor fabs in Singapore seems to be of lesser concern at the moment.</li>
<li>The emergence of AI offers new hope, not only for advanced semiconductor technology but also for lagging technologies.</li>
</ul>


The US-China trade war has shaped a new trend: Advanced and Matured Technologies led by Taiwan Semiconductor (TSMC) - ADR (TSM US) and Semiconductor Manufacturing International Corp (SMIC) (981 HK) respectively.
Notably, construction of semiconductor fabs in Singapore seems to be of lesser concern at the moment.
The emergence of AI offers new hope, not only for advanced semiconductor technology but also for lagging technologies.


The US-China Trade War Is Likely to Split the Semiconductor Industry into Two Groups.

Chief Executive Officer, Emmer Capital Partners Limited

Manishi Raychaudhuri

Chief Executive Officer

Emmer Capital Partners Limited

Emmer Capital Partners is an Asia Pacific focused financial advisory firm engaging in strategic financial asset allocation advice, bespoke thematic research and advising early-stage companies and connecting them to investors. Emmer Capital provides macro-economic and multi-asset investment strategy inputs to institutions, family offices, private wealth managers, private equity, and corporate boards directly and through independent research platforms. Emmer Capital also advises a wide range of startup companies on fund raising and business strategy. Emmer Capital's active engagement with the print and electronic media reaches a broad spectrum of investors across the globe.

<ul>
<li>Since the last rebalancing of our portfolio on 5th September, it has returned 13.5% vs 9.5% from MSCI-Asia-ex-Japan. Since inception (15th May), our portfolio has appreciated 20.1% vs MXASJ's 18.6%.</li>
<li>Six stocks, SK Hynix, TSMC, Samsung Electronics, Alibaba, China Hongqiao, Tencent, contributed almost the entire return of our portfolio. Overweight on Korea drove more than half the portfolio's return.</li>
<li>We turn more selective on Chinese discretionary consumption and step into the Korean defense sector. We exclude Anta Sports and Mediatek and include Hyundai Rotem and Hon Hai Precision.</li>
</ul>


Since the last rebalancing of our portfolio on 5th September, it has returned 13.5% vs 9.5% from MSCI-Asia-ex-Japan. Since inception (15th May), our portfolio has appreciated 20.1% vs MXASJ's 18.6%.
Six stocks, SK Hynix, TSMC, Samsung Electronics, Alibaba, China Hongqiao, Tencent, contributed almost the entire return of our portfolio. Overweight on Korea drove more than half the portfolio's return.
We turn more selective on Chinese discretionary consumption and step into the Korean defense sector. We exclude Anta Sports and Mediatek and include Hyundai Rotem and Hon Hai Precision.


Asian Equities: Model Portfolio Outperformed Sharply; Less China Consumption, More Korea Defence

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>TSMC: +25.4% Premium; At Historical Highs, Good Level to Short the Spread</li>
<li>UMC: +2.1% Premium; Upper Level of Historical Range, Short Level</li>
<li>ASE: +5.4% Premium; Near-Term High However Likely Best to Wait for Higher Levels</li>
</ul>


TSMC: +25.4% Premium; At Historical Highs, Good Level to Short the Spread
UMC: +2.1% Premium; Upper Level of Historical Range, Short Level
ASE: +5.4% Premium; Near-Term High However Likely Best to Wait for Higher Levels


Taiwan Dual-Listings Monitor: TSMC ADR Spread Near All-Time Highs; UMC at Upper End of Range

<ul>
<li>Rapidus vs. TSMC: Can Japan's Newcomer Compete in the 2nm Race?</li>
<li>Memory Monitor: The Emerging Mass-Market Edge AI Need for Mobiles; Long Micron Vs. Short Nanya Tech </li>
<li>Hon Hai Pauses Nissan Pursuit Amid Honda Talks -- A Japanese Savior for Nissan is Likely But This Confirms Hon Hai's EV Ambitions Remain High</li>
</ul>


Rapidus vs. TSMC: Can Japan's Newcomer Compete in the 2nm Race?
Memory Monitor: The Emerging Mass-Market Edge AI Need for Mobiles; Long Micron Vs. Short Nanya Tech 
Hon Hai Pauses Nissan Pursuit Amid Honda Talks -- A Japanese Savior for Nissan is Likely But This Confirms Hon Hai's EV Ambitions Remain High


Taiwan Tech Weekly: Rapidus's Challenge Vs. TSMC for 2nm; Hon Hai Hunting for Automaker Acquisition

Cross Asset Strategy

<ul>
<li>Over 2024 and 2025, Asia-ex-Japan equities are up c30%. During this period, the 12-month forward EPS has expanded only 5.6%. Forward EPS recovery is essential to take the market higher.</li>
<li>Over the medium to long term, share prices track earnings, as we notice in our long-term analysis of forward EPS trajectory and market movement. Disjoint movements usually mean revert quickly.</li>
<li>Forward EPS could move up further in China, Korea, Taiwan and Thailand. Hong Kong has overshot its forward EPS trajectory. Philippines has massively undershot. Other markets appear broadly in line.</li>
</ul>


Over 2024 and 2025, Asia-ex-Japan equities are up c30%. During this period, the 12-month forward EPS has expanded only 5.6%. Forward EPS recovery is essential to take the market higher.
Over the medium to long term, share prices track earnings, as we notice in our long-term analysis of forward EPS trajectory and market movement. Disjoint movements usually mean revert quickly.
Forward EPS could move up further in China, Korea, Taiwan and Thailand. Hong Kong has overshot its forward EPS trajectory. Philippines has massively undershot. Other markets appear broadly in line.


Asian Equities: After Two Years of Rerating, Will Earnings Catch up in 2026?

Taiwan

Taiwan Semiconductor Manufacturing Company Ltd. manufactures integrated circuits based on its proprietary designs.  The Company offers a comprehensive set of integrated circuit fabrication processes to manufacture CMOS logic, mixed-mode, volatile and non-volatile memory and BiCMOS chips.  Taiwan Semiconductor is an affiliate of Philips Electronics N.V.

TSMC (Taiwan Semiconductor Manufacturing) - ADR (TSM US)

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TSMC (Taiwan Semiconductor Manufacturing) - ADR (TSM US)

The US-China Trade War Is Likely to Split the Semiconductor Industry into Two Groups.

US-China trade war drives shift towards Advanced and Matured Technologies led by TSMC and SMIC, with AI offering hope for semiconductor and...

Patrick Liao

Asian Equities: Model Portfolio Outperformed Sharply; Less China Consumption, More Korea Defence

China's economic data (FAI & industrial growth sharply lower than expected, retail sales growth underwhelming) underscores the need for nuanced...

Manishi Raychaudhuri

Taiwan Dual-Listings Monitor: TSMC ADR Spread Near All-Time Highs; UMC at Upper End of Range

We analyze the premium and discount levels of dual-listed Taiwan companies, suggesting potential spread trading levels based on historical trends.

Vincent Fernando, CFA

Taiwan Tech Weekly: Rapidus's Challenge Vs. TSMC for 2nm; Hon Hai Hunting for Automaker Acquisition

Japan's newcomer Rapidus challenges TSMC in the 2nm race; Hon Hai's pursuit of Nissan pauses due to Nissan-Honda talks, but signals Hon Hai's...

Vincent Fernando, CFA

Asian Equities: After Two Years of Rerating, Will Earnings Catch up in 2026?

Asia-ex-Japan equities have surged, but forward EPS growth is lagging. Nascent signs of EPS recovery in CN, KR, TW & TH. HK market has overshot...

Manishi Raychaudhuri

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

The US-China Trade War Is Likely to Split the Semiconductor Industry into Two Groups.

​US-China trade war drives shift towards Advanced and Matured Technologies led by TSMC and SMIC, with AI offering hope for semiconductor and...

Patrick Liao

Asian Equities: Model Portfolio Outperformed Sharply; Less China Consumption, More Korea Defence

China's economic data (FAI & industrial growth sharply lower than expected, retail sales growth underwhelming) underscores the need for nuanced...

Manishi Raychaudhuri

Taiwan Dual-Listings Monitor: TSMC ADR Spread Near All-Time Highs; UMC at Upper End of Range

We analyze the premium and discount levels of dual-listed Taiwan companies, suggesting potential spread trading levels based on historical trends.

Vincent Fernando, CFA

Taiwan Tech Weekly: Rapidus's Challenge Vs. TSMC for 2nm; Hon Hai Hunting for Automaker Acquisition

​Japan's newcomer Rapidus challenges TSMC in the 2nm race; Hon Hai's pursuit of Nissan pauses due to Nissan-Honda talks, but signals Hon Hai's...

Vincent Fernando, CFA

Asian Equities: After Two Years of Rerating, Will Earnings Catch up in 2026?

​Asia-ex-Japan equities have surged, but forward EPS growth is lagging. Nascent signs of EPS recovery in CN, KR, TW & TH. HK market has overshot...

Manishi Raychaudhuri

US-China trade war drives shift towards Advanced and Matured Technologies led by TSMC and SMIC, with AI offering hope for semiconductor and...

Japan's newcomer Rapidus challenges TSMC in the 2nm race; Hon Hai's pursuit of Nissan pauses due to Nissan-Honda talks, but signals Hon Hai's...

Asia-ex-Japan equities have surged, but forward EPS growth is lagging. Nascent signs of EPS recovery in CN, KR, TW & TH. HK market has overshot...