Asia Pacific Equity Research

Research evidence excerpt

Asia Pacific Equity Research

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Asia First to Market 18 June 2026

Top Stories

TSMC (2330.TW, OW – NT$2385.0), Taiwan (Gokul Hariharan)

Assessing Competition Risk for Foundry and Advanced Packaging

In the last few weeks, most of the investor conversations have focused around the risk of higher competition

for TSMC in leading edge foundry and advanced backend from competitors such as Intel and any resulting

de-rating for the stock.

China Equity Strategy, China, Hong Kong (Erin Zhang, CFA / Tim Huang / Alex Yao / Gokul Hariharan /

Billy Feng / Olivia Xu)

Unique opportunities in the China AI ecosystem

China AI industry – a two-fold capex expansion with domestic players catching up. China’s AI sector

features a tightly imbalanced supply-demand profile with clear structural divergence across segments. On

the demand front, policy-backed domestic adoption is driving outsized, market-leading growth. JPM

forecasts China’s AI data center capital expenditure to expand c2x from US$55-69bn in 2026 to US$95-

151bn in 2029 (CAGR of c20-30%), and domestic inference token demand to grow at a 330% compound

annual rate through 2030, underpinned by 70%/90%+ AI agent application penetration by 2027/29, and 40%

industrial AI penetration by 2030, as mandated by the Chinese government. The capex estimate above

refers to AI compute spend in China vs the US$160-200bn number quoted by clients on total capex by

Chinese players both domestically and overseas and both AI and non-AI.