As early as the second quarter of this year, it was reported in the industry that there was a storm of downstream orders for consumer electronics, and the stock prices of related consumer electronics groups such as mature process chips, panels, display cards, and low-end and mid-end mobile phones all experienced significant corrections and declines one following another. , and the content of the Q2 company law meeting at this time also proves that the big storm under the high inventory and long whip effect is covering these related industries.
Holtek (6202-TW) Deputy General Manager Cai Rongzong pointed out that the company’s total inventory of downstream distributors was as high as 9 months, which was double the normal average and reached a record high.4919-TW), Lingtong (4952-TW) and other MCU indicator stocks. The mature process is also in the storm. It is reported from the mainland that the mature process chips have begun to enter the price competition. UMC (2303-TW) The stock price has fallen continuously in the past three days, by more than 9%, which also means that the market has negative expectations for the content of UMC’s 7/27 (Wed) legal meeting.
Moore Investment Consultant Zhang Yicheng believes that the decline of mature processes is all traceable, because it was stated in January this year that there will be excess capacity in 2023, which means that the trend has turned into a buyer’s market. Under the pressure of inventory under the expansion of production, a perfect storm of recession will take shape, the downstream demand will have a severe blow to the long-whip effect of upstream supply, and the price cut competition will be a fierce but unavoidable stage. The high substitution of mature processes has become the original sin. Unlike advanced processes, which are highly irreplaceable, not only did UMC’s share price fall, but the world (5347-TW), LSMC (6770-TW) and the stock price of Silicon Wafer both showed weakness and pulled back.
Analyst Zhang Yicheng believes that in the next wave of Taiwan stock market market in August, smart funds began to avoid vulnerable groups such as mature processes, panels, and graphics cards. In August, he believes that the theme stocks with continuity in Q3 are the first choice. There is room for stock price imagination, including electric vehicles, Netcom equipment, new biotechnology drugs, Metaverse, etc. You can pay more attention to Hon Hai (2317-TW), Yisheng-KY (5243-TW), Zhonglei (5388-TW), Chinese medicine (6446-TW), HTC (2498-TW) and Zhongguang (5371-TW) index stocks, for more Taiwan stock analysis, you can join Zhang Yicheng’s analyst LINE@fan group to follow.
[Analyst Zhang Yicheng – foreign capital super-money line]
Experience: Master of Finance from Peking University, former foreign trader at Citi Trading Room, former foreign trader at Barclays Hong Kong
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