Equity Long-Short

Mo Aziz

Thematic (Sector/Industry)

<ul>
<li>TSMC's CoWoS and 2nm GAA lead is structurally uncontested through 2028; AI capex compounds an already-unrivalled wafer and packaging monopoly.</li>
<li>Re-Rating catalyst is Q2 2026 earnings (TSMC 16 Jul, UMC 29 Jul, Hua Hong 6 Aug) testing whether fundamentals can support stock prices that have surged 200–500%.</li>
<li>Sector call: 2 BUY (TSMC, GlobalFoundries), 1 NEUTRAL (SMIC), 2 SELL (UMC, Hua Hong Grace).</li>
</ul>


TSMC's CoWoS and 2nm GAA lead is structurally uncontested through 2028; AI capex compounds an already-unrivalled wafer and packaging monopoly.
Re-Rating catalyst is Q2 2026 earnings (TSMC 16 Jul, UMC 29 Jul, Hua Hong 6 Aug) testing whether fundamentals can support stock prices that have surged 200–500%.
Sector call: 2 BUY (TSMC, GlobalFoundries), 1 NEUTRAL (SMIC), 2 SELL (UMC, Hua Hong Grace).


Semiconductor Foundry Handbook 2026 — One Monopoly, Two Disconnected Valuations

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

TSMC (Taiwan Semiconductor Manufacturing) / Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) (TSM US)

TSMC (Taiwan Semiconductor Manufacturing)

<ul>
<li>TSMC: +20.3% Premium; Rebounded from Our Long the ADR Level</li>
<li>UMC: +3.4% Premium; Above +1 SD Band; Short the ADR Spread</li>
<li>ASE: +5.8% Premium; Above +1 SD Band; Short the ADR Spread</li>
</ul>


TSMC: +20.3% Premium; Rebounded from Our Long the ADR Level
UMC: +3.4% Premium; Above +1 SD Band; Short the ADR Spread
ASE: +5.8% Premium; Above +1 SD Band; Short the ADR Spread


Taiwan Dual-Listings Monitor: UMC, ASE and ChipMOS Above +1 SD Band; Short the ADR Spread

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.

Quantitative Analysis

<ul>
<li>We analyzed the changes in foreign holdings of TWSE Stocks as of Oct 2nd. The aggregated holding was USD2,366.8bn.</li>
<li>We estimate that foreign flows to be outflows of USD839mln. We tabulate the league tables for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.</li>
<li>We highlight changes of foreign holdings in MediaTek, TSMC, Zhen Ding Technology, Winbond Electronics, Delta Electronics.</li>
</ul>


We analyzed the changes in foreign holdings of TWSE Stocks as of Oct 2nd. The aggregated holding was USD2,366.8bn.
We estimate that foreign flows to be outflows of USD839mln. We tabulate the league tables for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.
We highlight changes of foreign holdings in MediaTek, TSMC, Zhen Ding Technology, Winbond Electronics, Delta Electronics.


TWSE Foreign Holding Weekly (Oct 2nd): MediaTek, TSMC, Zhen Ding Technology, Winbond Electronics

<ul>
<li>We analysed the earning revision of component stocks of MS-Taiwan in the past month.</li>
<li>We tabulated stocks with the top impact on index's EPS, stocks' EPS revision, and revenue revision.</li>
<li>We highlighted EPS revision on TSMC, UMC, Nanya Technology, Quanta Computer, Phison Electronics, Wiwynn, Formosa Plastics.</li>
</ul>


We analysed the earning revision of component stocks of MS-Taiwan in the past month.
We tabulated stocks with the top impact on index's EPS, stocks' EPS revision, and revenue revision.
We highlighted EPS revision on TSMC, UMC, Nanya Technology, Quanta Computer, Phison Electronics, Wiwynn, Formosa Plastics.


MS-Taiwan Index Earning Revision (Sep): TSMC, UMC, Nanya Technology, Quanta Computer, Wiwynn

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>The global foundry industry has shifted decisively from a cyclical, inventory-driven model to a structural, AI-powered super cycle.</li><li>AI demand now serves as the dominant growth engine, against a backdrop of supportive inventory normalization.</li><li>We forecast the pure play foundry market to reach ~US$171bn in 2025, a 25.6% increase YoY, with sustained growth driven by: 1) continued AI infrastructure investment, 2) recovery in broader electronics demand, 3) technology node advancement, and 4) strategic regional capacity expansion. </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

The global foundry industry has shifted decisively from a cyclical, inventory-driven model to a structural, AI-powered super cycle.AI demand now serves as the dominant growth engine, against a backdrop of supportive inventory normalization.We forecast the pure play foundry market to reach ~US$171bn in 2025, a 25.6% increase YoY, with sustained growth driven by: 1) continued AI infrastructure investment, 2) recovery in broader electronics demand, 3) technology node advancement, and 4) strategic regional capacity expansion. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Semiconductors - Foundry – AI-driven super cycle reshapes market dynamics

Taiwan

United Microelectronics Corporation designs, manufactures, and markets integrated circuits (ICs) and related electronic products.  The Company's main products are consumer electronic ICs, memory ICs, personal computer peripheral ICs, and communication ICs.

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United Microelectronics Corp (2303 TT)

Semiconductor Foundry Handbook 2026 — One Monopoly, Two Disconnected Valuations

Five foundries, one true monopoly, two stocks priced for a fantasy. The EV/EBITDA-vs-ROIC framework that tells you which is which — before Q2...

Mo Aziz

Taiwan Dual-Listings Monitor: UMC, ASE and ChipMOS Above +1 SD Band; Short the ADR Spread

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

Vincent Fernando, CFA

TWSE Foreign Holding Weekly (Oct 2nd): MediaTek, TSMC, Zhen Ding Technology, Winbond Electronics

We analyzed TWSE foreign holding data for the past week and highlighted foreign holding changes in MediaTek, TSMC, Zhen Ding Technology, Winbond...

Ke Yan, CFA, FRM

MS-Taiwan Index Earning Revision (Sep): TSMC, UMC, Nanya Technology, Quanta Computer, Wiwynn

We analyzed MS-Taiwan's consensus for Sep 2026 and highlighted changes of EPS in TSMC, UMC, Nanya Technology, Quanta Computer, Phison Electronics,...

Ke Yan, CFA, FRM

Semiconductors - Foundry – AI-driven super cycle reshapes market dynamics

The global foundry industry has shifted decisively from a cyclical, inventory-driven model to a structural, AI-powered super cycle.

CMB International

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