(Jan 05): Taiwan Semiconductor Manufacturing Co shares climbed by the most since April, as the world’s largest contract chipmaker rides a continued wave of optimism over artificial intelligence demand into the new year.
Shares of the key supplier to Nvidia Corp and Apple Inc jumped as much as 6.9% to touch a new record high in Taipei. That came after Goldman Sachs Group Inc raised its TSMC price target 35% to NT$2,330, citing expectations of another year of solid growth.
TSMC helped lead a broad charge in Asian tech stocks Monday (Jan 5) as investors ploughed more cash into the AI theme despite concerns of overheating. The sector was once again the biggest boost to regional equities as fear of missing out on further gains overcame concerns of short-term volatility in the wake of US strikes against Venezuela.
“We view AI as a multi-year growth engine for TSMC,” Goldman analysts including Bruce Lu wrote in a report. Lu notes the company’s profit margins are improving, even as he projects it will spend US$150 billion over the next three years to increase capacity.
Among other chip stocks, South Korea’s Samsung Electronics Co extended gains to a fifth straight session. The memory maker is expected to report preliminary results later this week that will provide further clues on whether earnings justify the sector’s big gains.
See also: AMD unveils new chip for corporate data centers, talks up demand
Elsewhere, shares of Japanese equipment makers Tokyo Electron Ltd and Advantest Corp advanced more than 7% each Monday. Chinese chip stocks gained after the nation’s integrated circuit investment fund raised its stake in Semiconductor Manufacturing International Corp and DeepSeek flagged a more efficient approach to training AI.
TSMC helped drive Taiwan’s Taiex up more than 3% to a record of over 30,000, a level that “seemed almost impossible” until recently, according to Juan Ching-hwa, Taiwan’s deputy finance minister. Still, given the chipmaker’s dominance, there are “hopes for a more balanced structure,” he told lawmakers Monday.
The Hsinchu-based firm’s shares surged 44% in 2025, pushing its market value above US$1 trillion for the first time. That reflects increased investor confidence in its central position amid the AI boom, with many of the world’s chip companies relying on its foundry services.
See also: AI memory demand propels Kioxia to world’s best-performing stock
“For leading-edge semiconductors, capacity from TSMC is the king,” Sanford C Bernstein & Co analysts including Mark Li wrote in a note dated Friday. This year “is still all about AI”, the analysts said while recommending investors “focus on quality” given worries of a bubble.
TSMC is due to report earnings on Jan 15. Capital market activity may be another near-term catalyst for the sector, especially for Chinese stocks: around 11 AI-related companies have laid out plans to list in Hong Kong this month, with proceeds of as much as US$4.1 billion, according to data compiled by Bloomberg.
Meanwhile, valuations are seen supporting Asian shares relative to global peers. A gauge of the region’s tech hardware companies is trading at 16 times forward earnings estimates compared with 25 times for the Nasdaq 100.
Uploaded by Arion Yeow
