JPM | APAC Technology - SEC / TSMC / Kimi: APAC Technology - Specialist Sales Commentary Hardware - Semiconductors

Research evidence excerpt

JPM | APAC Technology - SEC / TSMC / Kimi: APAC Technology - Specialist Sales Commentary Hardware - Semiconductors

by investors, as Friday we saw a large ~$855m -4.5% day-on-day balance decline to $18.21bn. Mixo writes that

Taiwan margin balances are not high vs market cap, as offshore HF leverage, which is reducing, a larger factor. CFO Wendell

Huang comments to Bloomberg re-iterated mgmt. are doing everything they can to expand capacity to support customers’ growth,

and demonstrate do not intend to leave biz for competitors - addressing the dual capacity tightness and competitive issues cited by

the market. Also, offshore investors will have a choice to take dividend delivery in TWD or USD, which would reduce TSMC’s

FX hedging costs given the bulk of their revs USD-based. We see investor demand for upside call option structures, also financed

by puts (some near-term expiry structures w/ rapid time decay) as believe Fri selldown was triggered and exacerbated by

systematic program selling

Kimi K3: we have received many client queries on Kimi K3 and follow-ups w/ Olivia Xu, who covers the China AI model cos.

Josh also writes our team sees K3 priced ~4x vs latest K2.7 Code version, vs Zhipu GLM5.2 (almost on par w/ Opus 4.8); which

seems uncompetitive at this price. On the benchmark, K3 is #1 on front-end, which is the easy part (high verifiable, dense training

data). But on compositie indices, K3 still trails frontier models, and Moonshot themselves admit a gap on overall UX link

Key Highlights Today

• TSMC (OW PT -> NT$3,200): Rising confidence in AI demand, matched by increasing capex plans – Gokul Hariharan

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