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

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

<ul>
<li>TSMC: Premium Breaks Back Down to +8.3%; 5-15% Could Now Be the Key Range</li>
<li>UMC: -2.2% Discount; Good Level to Go Long the Premium</li>
<li>ASE: Premium Breaks Down Again, Now Only +1.5%; Consider Going Long</li>
</ul>


TSMC: Premium Breaks Back Down to +8.3%; 5-15% Could Now Be the Key Range
UMC: -2.2% Discount; Good Level to Go Long the Premium
ASE: Premium Breaks Down Again, Now Only +1.5%; Consider Going Long


Taiwan Dual-Listings Monitor: TSMC and ASE Premiums Break Down Again; ASE Spread Near 1-Year Lows

United Microelectron Sp Adr / Equity Bottom-Up

<ul>
<li>UMC's latest results indicate a mild recovery for consumer, communications, and computing industries. UMC's capacity utilization to continue improving but industry inventory correction could last until end-2024E.</li>
<li>UMC maintained 2024E capex guidance however it's increasingly clear UMC can't keep up the capex arms race alone. Hence we see UMC &amp; Intel becoming closer and closer partners.</li>
<li>We continue to view UMC as a long-term accumulate, and rate the stock as Structural Long, this however requires a longer than usual multi-year holding period.</li>
</ul>


UMC's latest results indicate a mild recovery for consumer, communications, and computing industries. UMC's capacity utilization to continue improving but industry inventory correction could last until end-2024E.
UMC maintained 2024E capex guidance however it's increasingly clear UMC can't keep up the capex arms race alone. Hence we see UMC &amp; Intel becoming closer and closer partners.
We continue to view UMC as a long-term accumulate, and rate the stock as Structural Long, this however requires a longer than usual multi-year holding period.


UMC Signals Non-AI Industry Inventory Correction Through 2024E; Why Intel Is Increasingly Important

Tracking developments across tech supply chains, Tech Supply Chain Tracker

Tech Supply Chain Tracker

Tracking developments across tech supply chains

<ul><li>CoSAI is a collaboration between tech giants like Intel, Google, and IBM to drive innovation in the automotive industry.</li><li>Knobs and buttons are making a comeback in car interfaces, reflecting a trend in automotive design for more tactile controls.</li><li>Apple opposes Tata-Vivo partnership as Vivo marks its 10th anniversary in India, while Biden admin shows support for CHIPS Act to boost packaging and testing industry.</li></ul>

CoSAI is a collaboration between tech giants like Intel, Google, and IBM to drive innovation in the automotive industry.Knobs and buttons are making a comeback in car interfaces, reflecting a trend in automotive design for more tactile controls.Apple opposes Tata-Vivo partnership as Vivo marks its 10th anniversary in India, while Biden admin shows support for CHIPS Act to boost packaging and testing industry.

Tech Supply Chain Tracker (01-Aug-2024): Top tech firms join CoSAI.

Taiwan Tech Focused Senior Analyst

Patrick Liao

<ul>
<li>3Q24 Sales: NT$123.5-132.4 billion, down 3% to up 4% QoQ, up 12-24% YoY. 4Q24 is expected to be a slower quarter based on current expectations.</li>
<li>Advanced 3nm technology can support SP, tablets, and other end devices. AI-powered functions like ARM-based CPU or EV will bear fruit in 2025.</li>
<li>The GPU has partnered with NVDA. Auto chips partnered with NVDA will be shipped out later in 2025. They will power MTK’s CPU and ISP in conjunction with NVDA’s GPU.</li>
</ul>


3Q24 Sales: NT$123.5-132.4 billion, down 3% to up 4% QoQ, up 12-24% YoY. 4Q24 is expected to be a slower quarter based on current expectations.
Advanced 3nm technology can support SP, tablets, and other end devices. AI-powered functions like ARM-based CPU or EV will bear fruit in 2025.
The GPU has partnered with NVDA. Auto chips partnered with NVDA will be shipped out later in 2025. They will power MTK’s CPU and ISP in conjunction with NVDA’s GPU.


MediaTek (2454.TT): There Appears to Be No Bright Spot in 2H24F.

<ul>
<li>3Q24 guidance: Shipment up mid-single digits QoQ; ASP: Remains firm in USD; GM: around mid-30%. (Consensuses were high single digits.)</li>
<li>Has provided a 22nm HV solution for high-end OLED DDI to high-end SP, and expects to reach high-volume production in 2025.  </li>
<li>Cooperation with <a href="https://www.smartkarma.com/entities/intel-corp" target="_blank" data-smartkarma-citation="entities:16764:1" rel="noopener">Intel Corp (INTC US)</a> is progressing well, targeting MP for 14nm in 2027.</li>
</ul>


3Q24 guidance: Shipment up mid-single digits QoQ; ASP: Remains firm in USD; GM: around mid-30%. (Consensuses were high single digits.)
Has provided a 22nm HV solution for high-end OLED DDI to high-end SP, and expects to reach high-volume production in 2025.  
Cooperation with Intel Corp (INTC US) is progressing well, targeting MP for 14nm in 2027.


UMC (2303.TT; UMC.US): 3Q24 Sales Were Slightly Below Consensuses

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.

Taiwan Semiconductor (TSMC) - ADR (TSM US)

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Taiwan Semiconductor (TSMC) - ADR (TSM US)

Taiwan Dual-Listings Monitor: TSMC and ASE Premiums Break Down Again; ASE Spread Near 1-Year Lows

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

Vincent Fernando, CFA

UMC Signals Non-AI Industry Inventory Correction Through 2024E; Why Intel Is Increasingly Important

UMC sees mild industry end demand improvement, but inventory correction may last until end-2024E. UMC and Intel's partnership will deepen over...

Vincent Fernando, CFA

Tech Supply Chain Tracker (01-Aug-2024): Top tech firms join CoSAI.

CoSAI partners with tech giants, car interfaces embrace knobs, Apple opposes Tata-Vivo, Biden supports CHIPS Act, Micron ships 9th-gen NAND, Taiwan...

Tech Supply Chain Tracker

MediaTek (2454.TT): There Appears to Be No Bright Spot in 2H24F.

MTK's 3Q24 sales range from NT$123.5-132.4bn, -3%~+4% QoQ, with a 12-24% YoY increase. Advanced 3nm technology will support AI-powered functions...

Patrick Liao

UMC (2303.TT; UMC.US): 3Q24 Sales Were Slightly Below Consensuses

Overall, sales are lower than consensuses in 3Q24. UMC plans to reach high-volume production for 22nm HV solution by 2025 and is progressing well...

Patrick Liao

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Taiwan Dual-Listings Monitor: TSMC and ASE Premiums Break Down Again; ASE Spread Near 1-Year Lows

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

Vincent Fernando, CFA

UMC Signals Non-AI Industry Inventory Correction Through 2024E; Why Intel Is Increasingly Important

​UMC sees mild industry end demand improvement, but inventory correction may last until end-2024E. UMC and Intel's partnership will deepen over...

Vincent Fernando, CFA

Tech Supply Chain Tracker (01-Aug-2024): Top tech firms join CoSAI.

CoSAI partners with tech giants, car interfaces embrace knobs, Apple opposes Tata-Vivo, Biden supports CHIPS Act, Micron ships 9th-gen NAND, Taiwan...

Tech Supply Chain Tracker

MediaTek (2454.TT): There Appears to Be No Bright Spot in 2H24F.

​MTK's 3Q24 sales range from NT$123.5-132.4bn, -3%~+4% QoQ, with a 12-24% YoY increase. Advanced 3nm technology will support AI-powered functions...

Patrick Liao

UMC (2303.TT; UMC.US): 3Q24 Sales Were Slightly Below Consensuses

Overall, sales are lower than consensuses in 3Q24. UMC plans to reach high-volume production for 22nm HV solution by 2025 and is progressing well...

Patrick Liao

UMC sees mild industry end demand improvement, but inventory correction may last until end-2024E. UMC and Intel's partnership will deepen over...

MTK's 3Q24 sales range from NT$123.5-132.4bn, -3%~+4% QoQ, with a 12-24% YoY increase. Advanced 3nm technology will support AI-powered functions...