TSMC shares boosted by Chang’s up­beat fore­cast

The China Post - - LOCAL -

Shares of Tai­wan Semi­con­duc­tor Man­u­fac­tur­ing Co. ( TSMC,

) moved higher Wed­nes­day morn­ing as in­vestors were en­cour­aged by a pos­i­tive fore­cast made by TSMC Chair­man Mor­ris Chang ( ) about the world’s largest con­tract chip-maker’s out­look, deal­ers said.

The 0.79 per­cent gains posted by TSMC’s Amer­i­can de­posi­tary re­ceipts (ADRs) on Wall Street overnight against a lack­lus­ter Dow Jones Industrial Av­er­age overnight also led in­vestors here to chase the stock soon af­ter the lo­cal bourse opened, they said.

As of 11:50 a.m., shares of TSMC, the most heav­ily weighted stock in the lo­cal mar­ket, had added 1.44 per­cent to NT$141.00 (US$4.53) with 23.28 mil­lion shares chang­ing hands. A higher TSMC led the weighted in­dex on the Tai­wan Stock Ex­change to stage a re­bound, up 1.46 per­cent at 9,326.24 points.

“As Chang spoke, the mar­ket lis­tened. That’s why in­vestors rushed to pick up the stock af­ter Chang made the com­ments in the an­nual gen­eral meet­ing held on Tues­day,” Hua Nan Se­cu­ri­ties an­a­lyst Kevin Su said.

Speak­ing to TSMC’s share­hold­ers, Chang said that TSMC will have a bet­ter sec­ond half of this year than the first half af­ter slow sea­son ef­fects seen in the Jan­uary-June pe­riod fade.

Chang said that he has main­tained a fore­cast for TSMC made in midApril that the chip maker will en­joy a more than 10 per­cent in­crease in sales and profit for 2015. The com­ments dis­pelled mar­ket con­cerns over a pos­si­ble ex­ten­sion of in­ven­tory ad­just­ments in the global semi­con­duc­tor in­dus­try, deal­ers said.

Chang said that although the global in­te­grated cir­cuit busi­ness has kicked off a se­ries of merger and ac­qui­si­tion deals, such con­sol­i­da­tion has im­posed limited im­pact on TSMC’s op­er­a­tions.

Among the lat­est deals, U.S.based IC gi­ant In­tel Corp. an­nounced ear­lier this month that it had agreed to ac­quire Al­tera, a pro­gram­mable logic semi­con­duc­tor sup­plier, for US$16.7 bil­lion. Al­tera is one of TSMC’s buy­ers.

Be­fore Chang spoke of the deals, the mar­ket had wor­ries that th­ese con­sol­i­da­tion trends in the in­dus­try could prompt its buy­ers to shift or­ders from the Tai­wanese chip maker to its com­peti­tors.

But, Chang said that TSMC did not suf­fer any large cut­back in or­ders by its cus­tomers so far, and the global semi­con­duc­tor in­dus­try still heav­ily de­pends on TSMC’s tech­nol­ogy and pro­duc­tion ca­pac­ity.

Bar­clays Cap­i­tal an­a­lyst An­drew Lu said that af­ter the con­sol­i­da­tion of TSMC’s share price in the re­cent ses­sion, the stock ap­peared at­trac­tive for the mo­ment.

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