Shares of Powerchip Semiconductor Manufacturing Corp (力積電), the world’s seventh-largest foundry, yesterday surged 223 percent on their first day on the Emerging Stock Board, boosting the company’s market capitalization to NT$260.8 billion (US$9.15 billion).
Powerchip’s market value surpassed that of its closest rival, Vanguard International Semiconductor Co (世界先進) valued at NT$210.8 billion, based on its share price of NT$128.5 yesterday.
Powerchip shares skyrocketed to touch NT$84 soon after the market opened in the morning, from the subscription price of NT$26 per share. The stock opened at NT$55.7.
Photo: Hung Yu-fang, Taipei Times
About 1.3 billion Powerchip shares changed hands, making it the most heavily traded stock on the board.
Last week, Powerchip gave an upbeat business outlook for this quarter and next year, saying that 8-inch capacity constraints have triggered panic among its customers. The company would raise prices to cope with capacity scarcity, it said.
As working from home, online learning and the stay-at-home economy stimulated demand for laptops and other devices, Powerchip said it has seen a spike in demand for display driver and power management ICs.
Its DRAM business is close to a breakeven level this quarter, the company added.
Powerchip’s revenue recovered to NT$3.98 billion in October, soaring 30.78 percent from NT$3.05 billion a year earlier. In the first 10 months of this year, revenue surged about 84 percent year-on-year to NT$37.79 billion from NT$20.56 billion.
Yuanta Investment Consulting Co (元大投顧) in a note ahead of Powerchip’s stock debut said that the foundry would next year benefit from 8-inch wafer capacity constraints, as it plans to expand its 8-inch wafer capacity by 20 percent and hike prices.
“We believe increases in average selling price and sales volume will be Powerchip’s major growth drivers in 2021,” Yuanta said on Tuesday.
Powerchip plans to raise prices by 5 percent to 10 percent next year, the note said.
Rising demand for power management ICs and improving DRAM chip business are also to drive the chipmaker’s financial performance, Yuanta added.
Yesterday’s debut marked a comeback for Powerchip, which was delisted from the Taipei Exchange in 2012 due to deep debts.
After a major restructuring aiming to minimize operational risk, Powerchip has transformed into a supplier of DRAM chips and provides contract manufacturing services for logic chips, including image sensor, display driver and power management ICs.
The company previously solely produced DRAM chips and relied on technology support from its Japanese partner, Elpida Inc, which was later acquired by US-based Micron Technology Inc.
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