Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) contributed the most to the market capitalization growth of Taiwanese semiconductor shares last year, Taiwan Stock Exchange (TWSE) data showed.
The local bourse closed trading for the year on Friday last week with the cap of total semiconductor shares in the market having increased by NT$1.02 trillion (US$31.6 billion) to about NT$7 trillion last year, up 17.4 percent from 2015, the data showed.
TSMC, the world’s largest contract chipmaker, last year posted a market cap increase of NT$998.3 billion, up 26.92 percent from the previous year and making it the biggest contributor to the NT$7 trillion market capitalization of the sector.
The Hsinchu-based company last year registered a market capitalization of NT$4.7 trillion, accounting for 67 percent of the sector’s total.
Analysts predict that TSMC’s revenue will grow more than 10 percent annually this year on the back of strong demand for its advanced tech nodes from applications of high-performance computing for gaming, virtual reality and data centers, as well as its lead in advanced process technology.
“TSMC will continue to gain full allocation of the next iPhone application processor [chips], namely A11, processed by 10-nanometer technology, as we believe TSMC’s 10-nanometer solutions are better [than its peers’] in terms of performance, power and area of silicon,” Daiwa Securities Co said in a client note last month.
TSMC’s 10-nanometer chip production technology was on track to start mass production in the fourth quarter of last year and the firm is expected to begin shipments in the first quarter of this year.
Last week, the company passed the final environmental impact assessment for a capacity expansion plan in central Taiwan, helping boost its 10-nanometer chip production this year.
The passage means that “we can push ahead with our 10-nanometer mass production plan at the Central Taiwan Science Park (中部科學園區),” TSMC spokesperson Elizabeth Sun (孫又文) said on Thursday last week.
The company — which counts Apple Inc, MediaTek Inc (聯發科) and Hisilicon Technologies Co (海思半導體) as its major clients for 10-nanometer chips — plans to invest about NT$550 billion on the new fabrications in entral Taiwan Science Park through next year.
TSMC has begun wafer production for MediaTek’s 10-nanometer chips, with MediaTek planning to ship its new high-end handset chip, the Helio X30, in the second quarter of this year.
“While it is the first time that TSMC is producing the 10-nanometer chips, the risk is low because TSMC has been doing pilot production for over a year,” Macquarie Capital Ltd said in a separate note last month.
For TSMC’s 10-nanometer chips, Apple will be the volume champion, followed by MediaTek and HiSilicon, and then makers of field programmable gate arrays, such as Xilinx Inc and Altera Corp, Macquarie said.
Additional reporting by Lisa Wang
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