Summary of Key Points from the Conference Call Industry Overview - Industry Focus: Greater China Technology Semiconductors [85][88] - Analyst Coverage: Morgan Stanley's equity analysts covering the semiconductor sector in Asia Pacific include Charlie Chan, Daniel Yen, Daisy Dai, and Duan Liu [1][85]. Core Insights and Arguments - Impact of DeepSeek on Technology: The conference discussed how DeepSeek is expected to influence the technology landscape, particularly in AI and supply chain management [6][11]. - Capex Growth Expectations: A projected 29% growth in capital expenditures (capex) for 2025 was highlighted, driven by major players in the cloud sector including Alphabet, Amazon, Microsoft, and others [19][20]. - NVIDIA Capex Growth: Analysts noted differing assumptions regarding NVIDIA's capex growth for 2025, with various companies in the semiconductor supply chain expected to experience varying levels of growth [22]. - Cloud Semiconductor Preferences: The report recommended a preference for Montage Technology over Aspeed Technology based on earnings revision breadth and year-over-year share price performance [24][25]. - Driver ICs Market Outlook: The market leader in driver integrated circuits (ICs) is expected to outperform, with a healthy level of total AMOLED smartphone market share anticipated for Q1 2024 [27]. Risks and Valuation Methodology - Valuation Methodology: The valuation for Aspeed Technology and Montage Technology is based on a residual income model, with key assumptions including medium-term growth rates of 15.8% and 13.7% respectively [29][31]. - Risks to Growth: Upside risks include stronger cloud demand and faster-than-expected technology migration, while downside risks involve softening cloud demand and intensified competition from US peers [31][31]. Additional Important Information - Investment Ratings: The report includes various investment ratings for companies within the semiconductor sector, with a significant number rated as Overweight (O) [85][87]. - Analyst Certifications: Analysts certified that their views on the companies discussed are accurately expressed and have not received compensation for specific recommendations [36]. - Disclosure of Conflicts: Morgan Stanley disclosed potential conflicts of interest due to its business relationships with companies covered in the research [2][37]. This summary encapsulates the essential insights and data points from the conference call, providing a comprehensive overview of the semiconductor industry dynamics and investment outlook.
Investor Presentation_ New Economy Webcast_ DeepSeek Impact on Asia AI Supply Chain