Taiwan Tech Focused Senior Analyst

Patrick Liao

Equity Bottom-Up

Hon Hai Precision Industry / Equity Bottom-Up

<ul>
<li>The 4Q23F results will be higher than 3Q23, but lower than 4Q22.</li>
<li>If the market is unchanged, and it will be slightly upside in 2024F market. </li>
<li>For the target of GM 10% is still unchanged in 2025F.</li>
</ul>


The 4Q23F results will be higher than 3Q23, but lower than 4Q22.
If the market is unchanged, and it will be slightly upside in 2024F market. 
For the target of GM 10% is still unchanged in 2025F.


Hon Hai (2317.TT): If the Market Is Unchanged, and It Will Be Slightly Upside in 2024 Market.

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>Nvidia's CEO Jensen Huang joined Hon Hai at its annual Tech Day yesterday, announcing  an expansion of their partnership into the development of AI factories that will produce new software.</li>
<li>Hon Hai unveiled its new 'Model N' EV, a van designed for logistics use cases. Its Model C SUV will have first customer deliveries in Taiwan in January 2024E.</li>
<li>The latest Nvidia partnership expansion announcement and EV developments will transform Hon Hai's unique value proposition to automakers. We continue to expect nearly 50% upside for the shares.</li>
</ul>


Nvidia's CEO Jensen Huang joined Hon Hai at its annual Tech Day yesterday, announcing  an expansion of their partnership into the development of AI factories that will produce new software.
Hon Hai unveiled its new 'Model N' EV, a van designed for logistics use cases. Its Model C SUV will have first customer deliveries in Taiwan in January 2024E.
The latest Nvidia partnership expansion announcement and EV developments will transform Hon Hai's unique value proposition to automakers. We continue to expect nearly 50% upside for the shares.


Hon Hai Tech Day Takeaways: Nvidia Announces AI Factories Partnership; Competitive Advantage for EVs

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

<ul>
<li>Apple Increasing Chip Orders with TSMC -- Expecting iPhone 16 Sales to be Much Stronger Than iPhone 15 Thanks to AI</li>
<li>Google Said to be Shifting to TSMC from Samsung for Next Generation AI Mobile Phone Chips</li>
<li>This June 28th piece appears to be timely -- Memory Monitor: Micron's Shares May Be Falling But Results' Industry Implications Are Positive</li>
</ul>


Apple Increasing Chip Orders with TSMC -- Expecting iPhone 16 Sales to be Much Stronger Than iPhone 15 Thanks to AI
Google Said to be Shifting to TSMC from Samsung for Next Generation AI Mobile Phone Chips
This June 28th piece appears to be timely -- Memory Monitor: Micron's Shares May Be Falling But Results' Industry Implications Are Positive


Taiwan Tech Weekly: Apple Hikes TSMC Orders on Strong IPhone 16 Hopes; Google Shifts AI Chip to TSMC

<ul>
<li>Hon Hai's 2Q23 results beat earnings street expectations by nearly 30%, thanks to AI server demand and gross margin rising.</li>
<li>Tightening China tech restrictions highlight Hon Hai's advantageous position for EV development.</li>
<li>Structural Long. Any weakness over worries about Apple/consumer products demand is an opportunity to accumulate. Investors shouldn't let cyclical expectations fluctuations blur their focus on Hon Hai's structural story.</li>
</ul>


Hon Hai's 2Q23 results beat earnings street expectations by nearly 30%, thanks to AI server demand and gross margin rising.
Tightening China tech restrictions highlight Hon Hai's advantageous position for EV development.
Structural Long. Any weakness over worries about Apple/consumer products demand is an opportunity to accumulate. Investors shouldn't let cyclical expectations fluctuations blur their focus on Hon Hai's structural story.


Hon Hai AI Server Business Expected to Take Market Share 2H23E, Structural Long

<ul>
<li>Taiwan Tech Rallies Along With Rebound In Global Tech; Hon Hai, Asustek Top Gainers; KYEC a Top Loser After Announcing China Market Divestment</li>
<li>PC Monitor: The Next Version of MSFT CoPilot Will Be the Killer App for a Global AI PC Upgrade Cycle </li>
<li>ASMedia GDR Early Look - Momentum Has Been Strong, and Raising Would Grow Its Cash Base Almost 6x </li>
</ul>


Taiwan Tech Rallies Along With Rebound In Global Tech; Hon Hai, Asustek Top Gainers; KYEC a Top Loser After Announcing China Market Divestment
PC Monitor: The Next Version of MSFT CoPilot Will Be the Killer App for a Global AI PC Upgrade Cycle 
ASMedia GDR Early Look - Momentum Has Been Strong, and Raising Would Grow Its Cash Base Almost 6x 


Taiwan Tech Weekly: Hon Hai New All-Time Highs; Asustek Soars; Leading Chip Testing Firm Exits China

Taiwan

Delta Electronics Inc. manufactures power supplies and video display products. The Company's products include switching power supplies, telecom power systems, uninterrupted power supply (UPS), variable speed alternating current (AC) monitor drives, high resolution color monitors, and projectors.  Delta also manufactures magnetic and networking components.

Foxconn Industrial Internet Co., Ltd. operates as a communication network equipment development company. The Company develops and sells network switches, routers, wireless devices, web servers, set top boxes, smart home gateways, and other products. Foxconn Industrial Internet also manufactures storage equipment.

Largan Precision Company Limited manufactures and markets optical lens modules and optoelectronic components. The Company offers lenses for liquid crystal display (LCD) projectors, scanners, optical mice, digital still cameras (DSCs), digital versatile discs (DVDs), light emitting diodes (LEDs), and photography mobile phones.

Yageo Corporation manufactures resistors and related equipment.  The Company also produces thick-film resistors which are used in downstream electronics products, and high power thin-film resistors and chip resistors which are used in aerospace, automobile, and precision electronics industries.  Through its subsidiaries, Yageo also operates a consumer goods importing business.

E Ink Holdings Inc. develops, manufactures, and markets thin film transistor liquid crystal displays (TFT-LCDs).  The Company's products are mainly used in mobile video systems, car navigation systems, camcorders, digitalcameras, industrial instruments, etc.

Unimicron Technology Corp. manufactures and markets double-sided and multi-layer printed circuit boards.  The Company also provides integrated circuits (IC) burning and testing services.

Jentech Precision Industrial Company Ltd. provides tooling, precision metal stamping, custom insert molding, injection molding, and assembly solutions for medical, consumer electronics, semiconductor, automotive, appliance, and micro electronic markets to a wide variety of industries.

Nan Ya Printed Circuit Board Corporation manufactures and markets printed circuit boards (PCBs) and integrated circuit (IC) substrates.

Innolux Corporation manufactures TFT-LCD, LCD models and LCD monitors. The company also provides research, development, manufacturing and retails business.

LOTES Co., Ltd specialize in design and manufacture of connectors, CPU Socket, Coolers and Antenna for Notebook Computer, Personal Computer, Mobile electronic device and Ditial Video.

Samsung SDI Co., Ltd. specializes in developing Lithium Ion Battery (LIB) technology.  The Company also manufactures cathode ray tubes (CRTs) for televisions and computer monitors.  Samsung SDI also produces liquid crystal display (LCD) components and rechargeable batteries for cellular phones , personal digital assistants (PDAs), Energy Storage Systems and solar panels.

Kyocera Corporation manufacturers electronic equipment and components. The Company's products include telecommunication equipment, information equipment, optical equipment, ceramic products, semiconductor parts, chips, hybrid integrated circuits, thermal printheads, image sensors, liquid crystal displays, and connectors. Kyocera operates worldwide.

Keysight Technologies, Inc. offers electronic measurement services using wireless, modular, and software solutions.

CDW Corporation of Delaware provides information technology products and services. The Company offers hardware, software, computer peripherals, cloud computing, mobile devices, network communication, and security solutions. CDW serves business, government, education, and healthcare customers throughout North America.

NAURA Technology Group Co., Ltd. is an integrated high-tech company, which manufactures electronics equipments and components, including IC equipments, hybrid integrated circuits and combines with R&D, sales, and services.

KEYENCE CORPORATION develops, manufactures, and sells sensors and measuring instruments used for factory automation (FA) and high technology hobby products. The Company's products include fiber optic sensors, photoelectric sensors, programmable logic controllers (PLC), laser scan micrometers, bar code readers, and radio-controlled model cars.

Hangzhou Hikvision Digital Technology Co., Ltd develops, manufactures and sells video surveillance products.  The Company manufactures video and audio compression card, network hard disk video recorders, video servers, cameras, network storage, and other digital products.

Hitachi, Ltd. manufactures communications and electronic equipment, heavy electrical and industrial machinery, and consumer electronics.  The Company's diverse product line ranges from nuclear power systems to kitchen appliances. Hitachi also operates subsidiaries in the wire and cable, metal, and chemical industries.

Zebra Technologies Corporation designs and manufactures enterprise mobile computers, advanced data capture devices, such as laser, 2D and RFID scanners and readers, and specialty printers for barcode labeling and personal identification. The Company also produces WLAN products, real-time location systems, related supplies and application software.

Trimble Navigation Ltd is a leading provider of advanced location-based solutions that maximize productivity and enhance profitability. The Company integrates its positioning expertise in GPS, laser, optical and inertial technologies with application software, wireless communications, and services to provide complete commercial solutions.

Hon Hai Precision Industry Co., Ltd. provides electronic manufacturing services for computers, communications, and consumer electronic products.  The Company's business operations include desktop and notebook PC assembly, connector production, cable assembly, PCB assembly, handset manufacturing, networking equipment, and other consumer electronic devices manufacturing.

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Hon Hai Precision Industry (2317 TT)

Hon Hai (2317.TT): If the Market Is Unchanged, and It Will Be Slightly Upside in 2024 Market.

The 4Q23F results will be higher than 3Q23, but lower than 4Q22. If the market is unchanged, and it will be slightly upside in 2024F market. For...

Patrick Liao

Hon Hai Tech Day Takeaways: Nvidia Announces AI Factories Partnership; Competitive Advantage for EVs

The latest Nvidia partnership expansion will transform Hon Hai's unique value proposition to automakers. We continue to expect nearly 50% upside...

Vincent Fernando, CFA

Taiwan Tech Weekly: Apple Hikes TSMC Orders on Strong IPhone 16 Hopes; Google Shifts AI Chip to TSMC

Apple and Google are increasing chip orders with TSMC for AI capabilities. Micron's shares inititially fell after reporting results previously,...

Vincent Fernando, CFA

Taiwan Tech Weekly: Hon Hai New All-Time Highs; Asustek Soars; Leading Chip Testing Firm Exits China

Taiwan tech gains alongside global tech, with Hon Hai and Asustek leading. MSFT's next CoPilot expected to drive AI PC upgrades. ASMedia GDR shows...

Vincent Fernando, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Hon Hai (2317.TT): If the Market Is Unchanged, and It Will Be Slightly Upside in 2024 Market.

The 4Q23F results will be higher than 3Q23, but lower than 4Q22. If the market is unchanged, and it will be slightly upside in 2024F market. For...

Patrick Liao

Hon Hai Tech Day Takeaways: Nvidia Announces AI Factories Partnership; Competitive Advantage for EVs

The latest Nvidia partnership expansion will transform Hon Hai's unique value proposition to automakers. We continue to expect nearly 50% upside...

Vincent Fernando, CFA

Taiwan Tech Weekly: Apple Hikes TSMC Orders on Strong IPhone 16 Hopes; Google Shifts AI Chip to TSMC

​Apple and Google are increasing chip orders with TSMC for AI capabilities. Micron's shares inititially fell after reporting results previously,...

Vincent Fernando, CFA

Hon Hai AI Server Business Expected to Take Market Share 2H23E, Structural Long

Any weakness over worries about Apple/consumer products is an opportunity to accumulate. Investors shouldn't let cyclical expectations fluctuations...

Vincent Fernando, CFA

Taiwan Tech Weekly: Hon Hai New All-Time Highs; Asustek Soars; Leading Chip Testing Firm Exits China

​Taiwan tech gains alongside global tech, with Hon Hai and Asustek leading. MSFT's next CoPilot expected to drive AI PC upgrades. ASMedia GDR shows...

Vincent Fernando, CFA

Apple and Google are increasing chip orders with TSMC for AI capabilities. Micron's shares inititially fell after reporting results previously,...

Taiwan tech gains alongside global tech, with Hon Hai and Asustek leading. MSFT's next CoPilot expected to drive AI PC upgrades. ASMedia GDR shows...