In today’s briefing:
- TSMC (2330.TT; TSM.US): The 1Q24F Revenue Outlook and the Progress for Intel, MediaTek and Samsung.
- 2024 High Conviction: Air China (753 HK) – Update on Proposed Share Placement
- Taiwan Tech Weekly: PC Shares Clearly On Santa’s Nice List; Soaring After AI PC Releases; Dell Trade
- Qantas Airways (QAN AU | BUY | TP:AU$6.58): Smooth Operator
- Thonburi Healthcare Group (THG TB): High Debt Has Clouded Near-Term Growth Prospect
TSMC (2330.TT; TSM.US): The 1Q24F Revenue Outlook and the Progress for Intel, MediaTek and Samsung.
- Taiwan Semiconductor (TSMC) (2330 TT)‘s revenue outlook for 1Q24F is expected to show a decline of around negative high single digits QoQ.
- Intel Corp (INTC US) aims to receive x86 CPU technology from TSMC 3nm in 1H24F.
- Mediatek Inc (2454 TT) plans to utilize 3nm technology for manufacturing smartphone SoCs in 2H24F, which will narrow the gap with Qualcomm Inc (QCOM US).
2024 High Conviction: Air China (753 HK) – Update on Proposed Share Placement
- Air China (H) (753 HK) is proposing a new share placement to raise Rmb6bn and HK$2bn. EPS dilution is manageable at 6% so we view the proposal positively.
- The new equity will enhance book value by 11.5% and lower its gearing by 103pp to 399.8%. The full subscription by the parent is also a vote of confidence.
- Recent share price weakness is due to the overall weakness in the Chinese equity market, but both macro and operating environments are improving. Selldown is unjustified.
Taiwan Tech Weekly: PC Shares Clearly On Santa’s Nice List; Soaring After AI PC Releases; Dell Trade
- PC Shares Soaring — After 1) Intel’s AI Everywhere AI chip launch, 2) Launch of First AI PCs, 3) Micron’s positive outlook for PCs in its latest results
- Micron Analysis, Industry Takeaways: Memory Market TAM New Highs into 2025; SK Hynix Trade
- Taiwan Dual-Listings Monitor: TSMC Premium at a Decent Short Level; ASE Short Interest Declining
Qantas Airways (QAN AU | BUY | TP:AU$6.58): Smooth Operator
- Qantas Airways (QAN AU) (QAN) is enjoying the best time of its life on industry consolidation benefits, demand exceeding supply to many sectors, and flourishing air cargo
- Domestic Australia is an ironclad goldmine, with a benign competitive environment as the archrival is busy restructuring. International sector capacity deployment is picking up, but still deep in underserved territory
- Target price AUD6.58 (+23% UPSIDE), based on 7x CY2024 PE – long-term historical mean. AUD500 million share buyback should provide downside support
Thonburi Healthcare Group (THG TB): High Debt Has Clouded Near-Term Growth Prospect
- Thonburi Healthcare Group (THG TB) has underperformed most of its peers over the last six months. Thus far this year, the company’s financial performance also remained unimpressive.
- Despite a healthy 29% YoY increase in normalized medical services revenue, normalized net profit decreased 8% YoY in 3Q23 as the company experienced significantly higher financial costs.
- Although the company is repaying debts, debt level is still elevated and is expected to remain so in the near-term due to upcoming capex plans.
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