Taiwan Tech Focused Senior Analyst

Patrick Liao

Equity Bottom-Up

Novatek Microelectronics Corp / Equity Bottom-Up

<ul>
<li>The 4Q24 outlook shows a decline of 12% in revenue, 3% in GM, and 15% in OPM compared to the previous quarter.</li>
<li>AI-Related demand is an ongoing trend, with AI smartphones, PCs, and NBs expected to drive replacement demand.</li>
<li>Mass production of expected OLED TDDI is set to begin in 2Q25 and is progressing smoothly with customers.</li>
</ul>


The 4Q24 outlook shows a decline of 12% in revenue, 3% in GM, and 15% in OPM compared to the previous quarter.
AI-Related demand is an ongoing trend, with AI smartphones, PCs, and NBs expected to drive replacement demand.
Mass production of expected OLED TDDI is set to begin in 2Q25 and is progressing smoothly with customers.


Novatek (3034.TT): 4Q24 Revenue Downside of More than 10% QoQ.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/apple-inc" target="_blank" data-smartkarma-citation="entities:666:1" rel="noopener">Apple (AAPL US)</a> will initially use Novatek's DDIC (Display Driver IC) for the iPhone 16, but it will soon being replaced largely.</li>
<li>In 4Q24, there is a possibility of experiencing a decline, with a potential quarter-over-quarter decrease of approximately 5-10%.</li>
<li>The Chinese panel market continues to be a key battleground, and Novatek must navigate these challenges to remain competitive.</li>
</ul>



Apple (AAPL US) will initially use Novatek's DDIC (Display Driver IC) for the iPhone 16, but it will soon being replaced largely.
In 4Q24, there is a possibility of experiencing a decline, with a potential quarter-over-quarter decrease of approximately 5-10%.
The Chinese panel market continues to be a key battleground, and Novatek must navigate these challenges to remain competitive.


Novatek (3034.TT): To Utilizing on IPhone 16 DDIC Will Soon Be Largely Replaced by Korean Fabless.

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Quantitative Analysis

<ul>
<li>We analyzed the changes in foreign holdings of TWSE Stocks as of Nov 22nd which has an aggregated holding worth USD1,003.7bn.</li>
<li>We estimate that foreign flows to be outflows of USD1,568mln. We tabulate the league table 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 Yang Ming Marine, TSMC, Hon Hai Precision Industry, Quanta Computer, Asustek Computer.</li>
</ul>


We analyzed the changes in foreign holdings of TWSE Stocks as of Nov 22nd which has an aggregated holding worth USD1,003.7bn.
We estimate that foreign flows to be outflows of USD1,568mln. We tabulate the league table for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.
We highlight changes of foreign holdings in Yang Ming Marine, TSMC, Hon Hai Precision Industry, Quanta Computer, Asustek Computer.


TWSE Foreign Holding Weekly (Nov 22nd): Yang Ming Marine, TSMC, Hon Hai Precision, Quanta, Asustek

<ul>
<li>We analyzed the changes in short interest of TWSE Stocks as of Nov 22nd which has an aggregated short interest worth USD21.9bn.</li>
<li>We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.</li>
<li>We highlight short interest changes in Mitac, Quanta Computer, Hon Hai Precision Industry, First Financial, Eva Airways, Yageo, Ta Chen Stainless Pipe.</li>
</ul>


We analyzed the changes in short interest of TWSE Stocks as of Nov 22nd which has an aggregated short interest worth USD21.9bn.
We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.
We highlight short interest changes in Mitac, Quanta Computer, Hon Hai Precision Industry, First Financial, Eva Airways, Yageo, Ta Chen Stainless Pipe.


TWSE Short Interest Weekly (Nov 22nd): Mitac, Quanta Computer, Hon Hai Precision, First Financial

<ul>
<li>The 3Q24 revenue is expected 10.5% higher than 2Q24, but the GM/OPG outlook will be 5.1%/3.6% lower because of pricing adjustments and limited NRE sales .  </li>
<li>Smartphone's demand will enter peak season with expected stockpiling for new models. Automotive inventory adjustment is needed due to muted demand.  </li>
<li>Dividend payout ratio has remained at 80-85% in recent years, with no major changes expected.</li>
</ul>


The 3Q24 revenue is expected 10.5% higher than 2Q24, but the GM/OPG outlook will be 5.1%/3.6% lower because of pricing adjustments and limited NRE sales .  
Smartphone's demand will enter peak season with expected stockpiling for new models. Automotive inventory adjustment is needed due to muted demand.  
Dividend payout ratio has remained at 80-85% in recent years, with no major changes expected.


Novatek (3034.TT): 3Q24 Guidance Slightly Weak in GM

Taiwan

Novatek Microelectronics Corporation designs, manufactures, and markets integrated circuits (ICs).  The Company's products are used in telecommunication, computer peripherals, and LCD (liquid crystal display) drivers.

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Novatek Microelectronics Corp (3034 TT)

Novatek (3034.TT): 4Q24 Revenue Downside of More than 10% QoQ.

4Q24 outlook shows decline in revenue, GM, and OPM. AI-related demand driving replacement demand. OLED TDDI mass production set for 2Q25.

Patrick Liao

Novatek (3034.TT): To Utilizing on IPhone 16 DDIC Will Soon Be Largely Replaced by Korean Fabless.

In 4Q24, Novatek faces potential decline in Chinese panel market, with a potential QoQ decrease of approximately 5-10%, and the demand may start...

Patrick Liao

TWSE Foreign Holding Weekly (Nov 22nd): Yang Ming Marine, TSMC, Hon Hai Precision, Quanta, Asustek

We analyzed TWSE foreign holding data for the past week and highlighted foreign holding changes in Yang Ming Marine, TSMC, Hon Hai Precision...

Ke Yan, CFA, FRM

TWSE Short Interest Weekly (Nov 22nd): Mitac, Quanta Computer, Hon Hai Precision, First Financial

We analyzed TWSE short interest report for the past week and highlighted short interest changes in Mitac, Quanta Computer, Hon Hai Precision...

Ke Yan, CFA, FRM

Novatek (3034.TT): 3Q24 Guidance Slightly Weak in GM

3Q24 revenue to rise 10.5%, but GM/OPG outlook to drop 5.1%/3.6% due to pricing adjustments. Smartphone demand peaks, automotive inventory...

Patrick Liao

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Novatek (3034.TT): 4Q24 Revenue Downside of More than 10% QoQ.

​4Q24 outlook shows decline in revenue, GM, and OPM. AI-related demand driving replacement demand. OLED TDDI mass production set for 2Q25.

Patrick Liao

Novatek (3034.TT): To Utilizing on IPhone 16 DDIC Will Soon Be Largely Replaced by Korean Fabless.

​In 4Q24, Novatek faces potential decline in Chinese panel market, with a potential QoQ decrease of approximately 5-10%, and the demand may start...

Patrick Liao

TWSE Foreign Holding Weekly (Nov 22nd): Yang Ming Marine, TSMC, Hon Hai Precision, Quanta, Asustek

We analyzed TWSE foreign holding data for the past week and highlighted foreign holding changes in Yang Ming Marine, TSMC, Hon Hai Precision...

Ke Yan, CFA, FRM

TWSE Short Interest Weekly (Nov 22nd): Mitac, Quanta Computer, Hon Hai Precision, First Financial

We analyzed TWSE short interest report for the past week and highlighted short interest changes in Mitac, Quanta Computer, Hon Hai Precision...

Ke Yan, CFA, FRM

Novatek (3034.TT): 3Q24 Guidance Slightly Weak in GM

​3Q24 revenue to rise 10.5%, but GM/OPG outlook to drop 5.1%/3.6% due to pricing adjustments. Smartphone demand peaks, automotive inventory...

Patrick Liao

4Q24 outlook shows decline in revenue, GM, and OPM. AI-related demand driving replacement demand. OLED TDDI mass production set for 2Q25.

In 4Q24, Novatek faces potential decline in Chinese panel market, with a potential QoQ decrease of approximately 5-10%, and the demand may start...

3Q24 revenue to rise 10.5%, but GM/OPG outlook to drop 5.1%/3.6% due to pricing adjustments. Smartphone demand peaks, automotive inventory...