UMC "Time to shine with structural shift in supply" (Buy) Lin

研报英文原文证据摘录

UMC "Time to shine with structural shift in supply" (Buy) Lin

ave

guided for relatively stable like-for-like pricing from Q225. Most non-Chinese foundries have also

guided for more stable sales growth in coming quarters, suggesting some demand upside from

broad-based restocking. TSMC's comments on mature foundry business reallocation also read

positively for the mature foundry industry. If TSMC drives meaningful optimisation of mature capacity

for advanced packaging, we would view UMC as a key beneficiary of order outflow in upcoming

years.

WHAT´S PRICED IN? We think UMC's YTD re-rating may reflect increasing optimism about TSMC's capacity reallocation

benefits, Intel's partnership opportunities, along with a healthier supply-demand outlook and UMC's

GM recovery in 2026E and beyond. At 15x 2028E PE, UMC's valuation is at a discount to the upper

end of its 14-22x NTM PE range in the previous upcycle (2021-early 2022). The premium over its 14x

PE historical mean likely bakes in the improvement we expect in UMC's earnings momentum from

2026E.

Upside/Downside of this mage/chartt

Spectrum report

ive this i

rat

tion of

nar

he

o t explana

t

Plea se r efer for an

Wafer ASP growth

Value drivers (2027/28E) Utilisation rate Gross margin

throughout the year

NT$280.00 upside 94.1%/98.2% 15%/19% 38.2%/46.9%

NT$230.00 base 91.8%/97.0% 11%/15% 37.3%/45.4%

NT$110.00 downside 88.2%/91.9% 5%/6% 35.1%/42.3%

Source: UBS estimates

Company Description Founded in 1980, UMC is a leading dedicated foundry service provider, with annual capacity of

around 11.6m 8-inch equivalent wafers as of 2025. In 2025, communications applications accounted

for 41% of its total revenue, consumer electronics 31%, computer applications 12% and other 16%.

UMC 24 June 2026 ab 2