ASM Pacific Tech (522 HK) Hold: On the road with management PDF Free Download
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Disclaimer & Disclosures
This report must be read with the disclosures and the analyst certifications in
the Disclosure appendix, and with the Disclaimer, which forms part of it.
Issuer of report: The Hongkong and Shanghai
Banking Corporation Limited
View HSBC Global Research at:
https://www.research.hsbc.com
We hosted ASMPT management for a non-deal roadshow
last week
Interest remains high, but questions focused on right-sizing
efforts to lower breakeven during anaemic growth period
We like the expanded TAM story, but diversity also makes
forecasting difficult. At 16x PE, valuation fairly full
We hosted ASMPT’s CEO/CFO in Hong Kong and Singapore last week. The
schedule was full, including group meetings, so investor interest in the name remains
high. Questions focused primarily on quantifying overall growth if ASMPT’s internal
forecasts for SMT, as well third-party assembly equipment industry researchers, are all
suggest declining markets in 2016. Given the anaemic growth outlook, investors also
challenged management about right-sizing efforts to lower its breakeven. In the past,
ASMPT used to wait for robust upturns to drive incremental margins, but the company
has more recently leveraged outsourcing to smooth out “cross-cycle” margins (and the
addition of DEK also helped). This can be seen in the relatively resilient gross margins in
recent years (e.g. gross margins up 85bp last year despite a 9% decline in revenue).
However, at the same time, operating expenses increased 10% in 2015, resulting in an
opex/sales ratio of approximately 25% (up 420bp y-o-y). The company’s goal for
opex/sales is 20% which we believe would require >HKD4bn/quarter in revenue under
the current cost structure (which compares with HKD2.9bn reported in 4Q15 with flat-to-
up 1Q16 revenue guidance). Net-net, we believe ASMPT can no longer simply wait for
growth if it wants to reach and consistently deliver long-term margin goals. We do note
that, if the company can achieve a 40% gross margin with 20% opex/sales, the resulting
20% operating margin would be 400-500bp above our forecast and consensus.
A look back at 2015’s growth vs peers. ASMPT suggested it outperformed the
market last year and, in fact, extended the distance versus its peers. Given that peer
BE Semiconductor (BESI NA – EUR23.33; not rated) reported a few days ago, we
consolidated 2015 revenue results for ASMPT, Kulicke & Soffa (KLIC US – USD11.30;
not rated), and BESI. In summary, ASMPT’s total revenue was down 9% last year,
with assembly equipment off 14%. This compares with BESI -8% y-o-y (constant
currency) and KLIC at -10%. ASMPT’s share gains must have come from elsewhere
and we suspect No. 1 positions in CMOS image sensor (CIS) and LED assembly
equipment helped most. In fact, ASMPT’s CEO confirmed that LED outperformed
semi last year and CIS actually increased approximately 15% in 2015. Interestingly,
excluding these markets, the results/comments may suggest ASMPT actually lost
share in the more traditional semiconductor assembly markets.
Hold. TP still HKD58 based on unchanged 16x PE. Like the expanded TAM and
diversity angles, but need revenue and margin recoveries to drive valuation upside.
1 March 2016
MAINTAIN HOLD
TARGET PRICE (HKD)
PREVIOUS TARGET (HKD)
58.00
58.00
SHARE PRICE (HKD)
UPSIDE/DOWNSIDE
62.35
-7.0%
(as of 29 Feb 2016)
MARKET DATA
Market cap (HKDm)
25,222
Free float
60%
Market cap (USDm)
3,244
BBG
522 HK
3m ADTV (USDm)
4.27
RIC
0522.HK
FINANCIALS AND RATIOS (HKD)
Year to
12/2014a
12/2015e
12/2016e
12/2017e
HSBC EPS
3.92
2.37
3.60
4.34
HSBC EPS (prev)
-
-
-
-
Change (%)
-
-
-
-
Consensus EPS
4.33
2.72
3.53
4.13
PE (x)
15.9
26.3
17.3
14.4
Dividend yield (%)
2.0
3.7
2.0
3.6
EV/EBITDA (x)
10.0
13.4
11.6
9.4
ROE (%)
20.9
11.8
18.0
20.1
52-WEEK PRICE (HKD)
Source: Thomson Reuters IBES, HSBC estimates
Steven C. Pelayo, CFA
Regional Head of Technology Research
The Hongkong and Shanghai Banking Corporation Limited
stevenpelayo@hsbc.com.hk
+852 2822 4391
Lionel Lin*
Analyst
The Hongkong and Shanghai Banking Corporation
Limited, Singapore Branch
lionelylin@hsbc.com.sg
+65 6658 0624
*Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is
not registered/ qualified pursuant to FINRA regulations
ASM Pacific Tech (522 HK)
EQUITIES
SEMICONDUCTORS
Hong Kong
HSBC Technology Day | March 2 • Hong Kong • Mandarin Oriental | March 3 • Singapore • The Fullerton Hotel
Register: https://www.hsbcscheduling.com/eventweb.php?id=bzJlMzA9YDRkbWcz
43.00
69.00
95.00
Mar 15 Aug 15 Feb 16
Target price: 58.00
High: 89.00 Low: 48.80 Current: 62.35
Hold: On the road with management
EQUITIES SEMICONDUCTORS
1 March 2016
2
Peer analysis. Assembly equipment share gains evident in 2013, less so since then
Ticker
Total revenue (USDm)
2013
2014
2015
2016e
522 HK
ASM Pacific Tech
1,399
1,836
1,674
1,733
KLIC US
Kulicke & Soffa
500
597
538
568
BESI NA
BE Semiconductor
338
494
383
371
BE Semiconductor (EURm)
255
379
349
338
Total (USDm)
2,237
2,927
2,595
2,672
Equipment revenue (USDm)
2013
2014
2015
2016e
522 HK
ASM Pacific Tech
671
878
757
793
KLIC US
Kulicke & Soffa
436
531
474
511
BESI NA
BE Semiconductor
338
494
383
371
BE Semiconductor (EURm)
255
379
349
338
Total equipment (USDm)
1,445
1,903
1,615
1,676
Total revenue y-o-y
2013
2014
2015
2016e
522 HK
ASM Pacific Tech
3.6%
31.3%
-8.8%
3.5%
KLIC US
Kulicke & Soffa
-36.3%
19.4%
-9.9%
5.7%
BESI NA
BE Semiconductor
-4.8%
46.2%
-22.4%*
-3.2%
BE Semiconductor (EURm)
-6.9%
48.6%
-7.8%
-3.3%
Total revenue y-o-y
-10.2%
30.9%
-11.3%
2.9%
Equipment revenue y-o-y
2013
2014
2015
2016e
522 HK
ASM Pacific Tech
3.5%
30.8%
-13.7%
4.8%
KLIC US
Kulicke & Soffa
-39.5%
21.8%
-10.7%
7.8%
BESI NA
BE Semiconductor
-4.8%
46.2%
-22.4%
-3.2%
BE Semiconductor (EURm)
-6.9%
48.6%
-7.8%
-3.3%
Total equipment y-o-y
-16.2%
31.7%
-15.1%
3.8%
Note: ASMPT’s 2016e revenue is based on HSBC estimates. Kulicke & Soffa’s total revenue based on consensus (equipment revenue is 90% of total revenue, similar ratio to
prior few years). BE Semi revenue based on consensus
*We assume all BE Semiconductor’s revenue to be equipment revenue
Source: Company data and filings, Bloomberg consensus, HSBC estimates
Peer margin analysis. ASMPT no longer provides equipment EBIT margins, but net
margin suffered in 2015
Ticker
Equipment gross profit (USDm)
2013
2014
2015
2016e
522 HK
ASM Pacific Tech
239
367
299
323
KLIC US
Kulicke & Soffa (equip only)
196
250
218
N.A.
BESI NA
BE Semiconductor(same as total)
135
216
187
179
BE Semiconductor (EURm)
102
166
170
163
Total equipment (USDm)
570
834
704
N.M.
Equipment gross margin
2013
2014
2015
2016e
522 HK
ASM Pacific Tech
35.6%
41.9%
39.4%
40.7%
KLIC US
Kulicke & Soffa (equip only)
45.1%
47.1%
46.1%
N.A.
BESI NA
BE Semiconductor (same as total)
39.8%
43.7%
48.8%
48.4%
Total equipment (USDm)
39.4%
43.8%
43.6%
Equipment operating profit (USDm)
2013
2014
2015
2016e
522 HK
ASM Pacific Tech (Equip + LF)
78
193
NA
N.A.
KLIC US
Kulicke & Soffa (equip only)
44
72
10
N.A.
BESI NA
BE Semiconductor (same as total)
25
94
63
59
BE Semiconductor (EURm)
19
72
58
54
Total equipment (USDm)
147
359
N.M.
N.M.
Equipment op margin
2013
2014
2015
2016e
522 HK
ASM Pacific Tech (Equip + LF)
8.7%
17.2%
N.A.
N.A.
KLIC US
Kulicke & Soffa (equip only)
10.2%
13.6%
2.1%
N.A.
BESI NA
BE Semiconductor (same as total)
7.3%
19.0%
16.5%
16.0%
Total equipment margin
6.8%
12.5%
N.M.
N.M.
Segment Net profit/margin (USDm)
2013
2014
2015
2016e
522 HK
ASM Pacific Tech (equip only)
70
177
91
N.A.
ASM Pacific Tech (equip only)
10.4%
20.2%
12.0%
N.A.
Note: ASMPT no longer divulges EBIT margins by segment, only net margins (also shown)
Source: Company data and filings, Bloomberg consensus, HSBC estimates
3
EQUITIES SEMICONDUCTORS
1 March 2016
ASM Pacific Tech: HSBC quarterly estimates versus consensus
_________________ 1Q16e _________________
_________________ 2Q16e _________________
(HKDm)
HSBC
Consensus
HSBC
Consensus
Revenue
2,985
2,962
3,323
3,495
Q-o-q growth
1.9%
1.1%
11.3%
18.0%
Gross margin
35.1%
35.6%
37.7%
37.0%
Operating profit
291
296
474
499
Operating margin
9.7%
10.0%
14.2%
14.3%
Net profit
226
225
367
380
EPS (HKD)
0.56
0.56
0.90
0.94
Source: Bloomberg consensus, HSBC estimates
ASM Pacific Tech: HSBC annual estimates versus consensus
__________________ 2016e _________________
_________________ 2017e __________________
(HKDm)
HSBC
Consensus
HSBC
Consensus
Revenue
13,429
13,522
14,293
14,469
Y-o-y growth
3.5%
4.2%
6.4%
7.0%
Gross margin
36.9%
36.7%
37.9%
37.0%
Operating profit
1,888
1,785
2,314
2,167
Operating margin
14.1%
13.2%
16.2%
15.0%
Net profit
1,460.5
1,353.0
1,770
1,619
EPS (HKD)
3.60
3.32
4.34
3.94
Source: Bloomberg consensus, HSBC estimates
ASMPT: Revenue, by segment
(HKDm)
1Q15
2Q15
3Q15
4Q15
1Q16e
2Q16e
3Q16e
4Q16e
2014
2015
2016e
Assembly Equipment
1,366
1,862
1,455
1,187
1,365
1,502
1,727
1,555
6,804
5,870
6,149
Leadframe
441
448
418
407
419
440
462
439
1,902
1,715
1,762
SMT
1,248
1,453
1,358
1,334
1,200
1,380
1,588
1,349
4,979
5,392
5,518
DEK
–
–
–
–
–
–
–
–
545
–
–
Total
3,056
3,762
3,231
2,928
2,985
3,323
3,777
3,343
14,229
12,977
13,429
Source: Company data, HSBC estimates
Valuation and risks
ASMPT: Forward PE band chart
ASMPT: PB versus forward ROE
Source: Company data, HSBC estimates
Source: Company data, HSBC estimates
Our estimates are unchanged.
We view fair value at a 16x target PE multiple (unchanged), which is based on our 2016e EPS
of HKD3.60 (unchanged). Hence, our fair value target price remains at HKD58.
We believe our target multiple is a fair one given that ASMPT has been a turnaround story for
the past few years (ROE rebounded to above 20% in 2014 and we expect it to stay in the
18-20% range in 2016e/17e versus the 8% seen in 2013) and the shares have been trading in a
range of 15-18x for the past 1-2 years. We maintain our Hold rating on the stock.
10
30
50
70
90
110
01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16
12.0x 15.0x 18.0x
0%
10%
20%
30%
40%
50%
0x
2x
4x
6x
8x
10x
01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16
P/B Forward ROE
EQUITIES SEMICONDUCTORS
1 March 2016
4
Upside risks to our rating and estimates include a rapid pick-up in end demand for consumer
electronics, significant pick-up in business from China, better-than-expected margin expansion,
faster-than-expected pick-up in SMT.
Downside risks to our investment view include overcapacity or a cyclical slowdown, a
slowdown in the LED sector, potential integration issues, an inability to implement cost-cutting
measures successfully or excess supply, and unexpectedly weak demand resulting in an even
greater-than-expected cyclical decline or a prolonged recovery.
ASMPT: Profit and loss statement
(HKDm)
1Q15
2Q15
3Q15
4Q15
1Q16e
2Q16e
3Q16e
4Q16e
2014
2015
2016e
Revenue
3,056
3,762
3,231
2,928
2,985
3,323
3,777
3,343
14,229
12,977
13,429
q-o-q
-11.3%
23.1%
-14.1%
-9.4%
1.9%
11.3%
13.7%
-11.5%
0.0%
0.0%
0.0%
y-o-y
22.6%
9.4%
-33.4%
-15.0%
-2.3%
-11.7%
16.9%
14.2%
31.3%
-8.8%
3.5%
COGS
1,943
2,342
2,136
1,842
1,936
2,069
2,350
2,112
9,180
8,262
8,468
% of revenue
63.6%
62.2%
66.1%
62.9%
64.9%
62.3%
62.2%
63.2%
64.5%
63.7%
63.1%
Gross profit
1,113
1,420
1,095
1,087
1,049
1,254
1,427
1,231
5,050
4,715
4,961
Gross margin
36.4%
37.8%
33.9%
37.1%
35.1%
37.7%
37.8%
36.8%
35.5%
36.3%
36.9%
Op profit
363
596
300
238
291
474
617
506
2,119
1,497
1,888
Op margin
11.9%
15.9%
9.3%
8.1%
9.7%
14.2%
16.3%
15.1%
14.9%
11.5%
14.1%
Tax (credit)
119
106
67
119
67
109
142
116
429
410
434
Tax rate
29.4%
19.5%
27.1%
70.5%
23.0%
23.0%
23.0%
23.0%
21.1%
30.1%
23.0%
Net profit
285
438
180
53
226
367
477
391
1,600
956
1,460
EPS (HKD)
0.71
1.09
0.45
0.13
0.56
0.90
1.18
0.96
3.92
2.37
3.60
Source: Company data, HSBC estimates
5
EQUITIES SEMICONDUCTORS
1 March 2016
Financials & valuation
Financial statements
Year to
12/2014a
12/2015e
12/2016e
12/2017e
Profit & loss summary
(HKDm)
Revenue
14,229
12,977
13,429
14,293
EBITDA
2,506
1,885
2,288
2,717
Depreciation & amortisation
-388
-388
-400
-403
Operating profit/EBIT
2,118
1,497
1,888
2,314
Net interest
-91
-133
0
0
HSBC PBT
2,028
1,363
1,888
2,314
Taxation
-429
-410
-434
-532
HSBC net profit
1,599
956
1,460
1,770
Cash flow summary
(HKDm)
Cash flow from operations
1,485
2,470
987
2,717
Capex
-314
-558
-650
-600
Cash flow from investment
-1,622
-558
-650
-600
Dividends
-521
-926
-515
-922
Change in net debt
768
305
1,279
-1,028
FCF equity
1,139
783
1,203
1,584
Balance sheet summary
(HKDm)
Tangible fixed assets
3,656
3,774
3,942
3,888
Current assets
10,840
10,303
9,944
11,271
Cash & others
2,594
2,275
996
2,025
Total assets
14,496
14,076
13,886
15,159
Operating liabilities
3,975
3,529
3,358
3,437
Gross debt
2,316
2,302
2,302
2,302
Net debt
-278
27
1,306
277
Shareholders’ funds
8,205
8,036
8,226
9,419
Invested capital
7,927
8,272
9,532
9,696
Ratio, growth and per share analysis
Year to
12/2014a
12/2015e
12/2016e
12/2017e
Y-o-y % change
Revenue
31.3
-8.8
3.5
6.4
EBITDA
111.5
-24.8
21.4
18.7
Operating profit
174.8
-29.3
26.1
22.6
PBT
201.7
-32.8
38.5
22.6
HSBC EPS
181.4
-39.6
52.1
20.5
Ratios (%)
Revenue/IC (x)
2.0
1.6
1.5
1.5
ROIC
23.9
12.9
16.3
18.5
ROE
20.9
11.8
18.0
20.1
ROA
13.2
7.3
10.4
12.3
EBITDA margin
17.6
14.5
17.0
19.0
Operating profit margin
14.9
11.5
14.1
16.2
Net debt/equity
-3.4
0.3
15.9
2.9
Net debt/EBITDA (x)
-0.1
0.0
0.6
0.1
CF from operations/net debt
9113.5
75.6
979.3
Per share data
(HKD)
HSBC EPS (diluted)
3.92
2.37
3.60
4.34
DPS
1.28
2.29
1.27
2.26
Book value
20.13
19.92
20.30
23.11
Valuation data
Year to
12/2014a
12/2015e
12/2016e
12/2017e
EV/sales
1.8
1.9
2.0
1.8
EV/EBITDA
10.0
13.4
11.6
9.4
EV/IC
3.1
3.1
2.8
2.6
PE*
15.9
26.3
17.3
14.4
PB
3.1
3.1
3.1
2.7
FCF yield (%)
4.5
3.1
4.8
6.3
Dividend yield (%)
2.0
3.7
2.0
3.6
*Based on HSBC EPS (diluted)
Price relative
Note:
Priced at close of
29 Feb 2016
Source: HSBC
42.00
52.00
62.00
72.00
82.00
92.00
102.00
42.00
52.00
62.00
72.00
82.00
92.00
102.00
2014 2015 2016 2017
ASM Pacific Technology Rel to HANG SENG INDEX
EQUITIES SEMICONDUCTORS
1 March 2016
6
Disclosure appendix
Analyst Certification
The following analyst(s), economist(s), and/or strategist(s) who is(are) primarily responsible for this report, certifies(y) that the
opinion(s) on the subject security(ies) or issuer(s) and/or any other views or forecasts expressed herein accurately reflect their
personal view(s) and that no part of their compensation was, is or will be directly or indirectly related to the specific
recommendation(s) or views contained in this research report: Steven Pelayo and Lionel Lin
Important disclosures
Equities: Stock ratings and basis for financial analysis
HSBC believes an investor’s decision to buy or sell a stock should depend on individual circumstances such as the investor’s
existing holdings, risk tolerance and other considerations and that investors utilise various disciplines and investment horizons
when making investment decisions. Ratings should not be used or relied on in isolation as investment advice. Different
securities firms use a variety of ratings terms as well as different rating systems to describe their recommendations and
therefore investors should carefully read the definitions of the ratings used in each research report. Further, investors should
carefully read the entire research report and not infer its contents from the rating because research reports contain more
complete information concerning the analysts’ views and the basis for the rating.
From 23rd March 2015 HSBC has assigned ratings on the following basis:
The target price is based on the analyst’s assessment of the stock’s actual current value, although we expect it to take six to 12
months for the market price to reflect this. When the target price is more than 20% above the current share price, the stock will
be classified as a Buy; when it is between 5% and 20% above the current share price, the stock may be classified as a Buy or a
Hold; when it is between 5% below and 5% above the current share price, the stock will be classified as a Hold; when it is
between 5% and 20% below the current share price, the stock may be classified as a Hold or a Reduce; and when it is more
than 20% below the current share price, the stock will be classified as a Reduce.
Our ratings are re-calibrated against these bands at the time of any ‘material change’ (initiation or resumption of coverage,
change in target price or estimates).
Upside/Downside is the percentage difference between the target price and the share price.
Prior to this date, HSBC’s rating structure was applied on the following basis:
For each stock we set a required rate of return calculated from the cost of equity for that stock’s domestic or, as appropriate,
regional market established by our strategy team. The target price for a stock represented the value the analyst expected the
stock to reach over our performance horizon. The performance horizon was 12 months. For a stock to be classified as
Overweight, the potential return, which equals the percentage difference between the current share price and the target price,
including the forecast dividend yield when indicated, had to exceed the required return by at least 5 percentage points over the
succeeding 12 months (or 10 percentage points for a stock classified as Volatile*). For a stock to be classified as Underweight,
the stock was expected to underperform its required return by at least 5 percentage points over the succeeding 12 months (or
10 percentage points for a stock classified as Volatile*). Stocks between these bands were classified as Neutral.
*A stock was classified as volatile if its historical volatility had exceeded 40%, if the stock had been listed for less than 12
months (unless it was in an industry or sector where volatility is low) or if the analyst expected significant volatility. However,
stocks which we did not consider volatile may in fact also have behaved in such a way. Historical volatility was defined as the
past month’s average of the daily 365-day moving average volatilities. In order to avoid misleadingly frequent changes in rating,
however, volatility had to move 2.5 percentage points past the 40% benchmark in either direction for a stock’s status to change.
7
EQUITIES SEMICONDUCTORS
1 March 2016
As of 01 March 2016, the distribution of all ratings published is as follows:
Buy
48%
(27% of these provided with Investment Banking Services)
Hold
38%
(29% of these provided with Investment Banking Services)
Sell
14%
(18% of these provided with Investment Banking Services)
For the purposes of the distribution above the following mapping structure is used during the transition from the previous to
current rating models: under our previous model, Overweight = Buy, Neutral = Hold and Underweight = Sell; under our current
model Buy = Buy, Hold = Hold and Reduce = Sell. For rating definitions under both models, please see “Stock ratings and basis
for financial analysis” above.
Share price and rating changes for long-term investment opportunities
ASM Pacific Technology (0522.HK) share price
performance HKD Vs HSBC rating history
Rating & target price history
From To Date
Underweight Neutral 10 April 2013
Neutral Overweight 03 March 2014
Overweight Neutral 08 May 2014
Neutral Overweight 01 September 2014
Overweight Hold 24 April 2015
Hold Buy 08 October 2015
Buy Hold 25 November 2015
Target price Value Date
Price 1 72.00 06 March 2013
Price 2 85.00 10 April 2013
Price 3 82.00 24 April 2013
Price 4 88.50 25 July 2013
Price 5 75.00 03 November 2013
Price 6 82.00 03 March 2014
Price 7 90.00 14 April 2014
Price 8 93.00 24 April 2014
Price 9 88.00 24 April 2015
Price 10 75.00 29 July 2015
Price 11 80.00 30 July 2015
Price 12 65.00 08 October 2015
Price 13 62.00 29 October 2015
Price 14 58.00 24 February 2016
Source: HSBC
Source: HSBC
20
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Mar-16
EQUITIES SEMICONDUCTORS
1 March 2016
8
HSBC & Analyst disclosures
Disclosure checklist
Company
Ticker
Recent price
Price date
Disclosure
ASM PACIFIC TECHNOLOGY
0522.HK
62.35
29-Feb-2016
1, 5, 6, 7
Source: HSBC
1
HSBC has managed or co-managed a public offering of securities for this company within the past 12 months.
2
HSBC expects to receive or intends to seek compensation for investment banking services from this company in the next 3
months.
3
At the time of publication of this report, HSBC Securities (USA) Inc. is a Market Maker in securities issued by this
company.
4
As of 31 January 2016 HSBC beneficially owned 1% or more of a class of common equity securities of this company.
5
As of 31 January 2016, this company was a client of HSBC or had during the preceding 12 month period been a client of
and/or paid compensation to HSBC in respect of investment banking services.
6
As of 31 January 2016, this company was a client of HSBC or had during the preceding 12 month period been a client of
and/or paid compensation to HSBC in respect of non-investment banking securities-related services.
7
As of 31 January 2016, this company was a client of HSBC or had during the preceding 12 month period been a client of
and/or paid compensation to HSBC in respect of non-securities services.
8
A covering analyst/s has received compensation from this company in the past 12 months.
9
A covering analyst/s or a member of his/her household has a financial interest in the securities of this company, as
detailed below.
10
A covering analyst/s or a member of his/her household is an officer, director or supervisory board member of this
company, as detailed below.
11
At the time of publication of this report, HSBC is a non-US Market Maker in securities issued by this company and/or in
securities in respect of this company
HSBC and its affiliates will from time to time sell to and buy from customers the securities/instruments, both equity and debt
(including derivatives) of companies covered in HSBC Research on a principal or agency basis.
Analysts, economists, and strategists are paid in part by reference to the profitability of HSBC which includes investment
banking, sales & trading, and principal trading revenues.
Whether, or in what time frame, an update of this analysis will be published is not determined in advance.
Economic sanctions imposed by the EU and OFAC prohibit transacting or dealing in new debt or equity of Russian SSI entities.
This report does not constitute advice in relation to any securities issued by Russian SSI entities on or after July 16 2014 and as
such, this report should not be construed as an inducement to transact in any sanctioned securities.
For disclosures in respect of any company mentioned in this report, please see the most recently published report on that
company available at www.hsbcnet.com/research.
Additional disclosures
1 This report is dated as at 1 March 2016.
2 All market data included in this report are dated as at close 29 February 2016, unless otherwise indicated in the report.
3 HSBC has procedures in place to identify and manage any potential conflicts of interest that arise in connection with its
Research business. HSBC’s analysts and its other staff who are involved in the preparation and dissemination of Research
operate and have a management reporting line independent of HSBC’s Investment Banking business. Information Barrier
procedures are in place between the Investment Banking, Principal Trading, and Research businesses to ensure that any
confidential and/or price sensitive information is handled in an appropriate manner.
9
EQUITIES SEMICONDUCTORS
1 March 2016
Disclaimer
Legal entities as at 30 May 2014:
‘UAE’ HSBC Bank Middle East Limited, Dubai; ‘HK’ The Hongkong and Shanghai Banking Corporation Limited, Hong
Kong; ‘TW’ HSBC Securities (Taiwan) Corporation Limited; ‘CA’ HSBC Bank Canada, Toronto; HSBC Bank, Paris Branch;
HSBC France; ‘DE’ HSBC Trinkaus & Burkhardt AG, Düsseldorf; 000 HSBC Bank (RR), Moscow; ‘IN’ HSBC Securities and
Capital Markets (India) Private Limited, Mumbai; ‘JP’ HSBC Securities (Japan) Limited, Tokyo; ‘EG’ HSBC Securities Egypt
SAE, Cairo; ‘CN’ HSBC Investment Bank Asia Limited, Beijing Representative Office; The Hongkong and Shanghai
Banking Corporation Limited, Singapore Branch; The Hongkong and Shanghai Banking Corporation Limited, Seoul
Securities Branch; The Hongkong and Shanghai Banking Corporation Limited, Seoul Branch; HSBC Securities (South
Africa) (Pty) Ltd, Johannesburg; HSBC Bank plc, London, Madrid, Milan, Stockholm, Tel Aviv; ‘US’ HSBC Securities (USA)
Inc, New York; HSBC Yatirim Menkul Degerler AS, Istanbul; HSBC México, SA, Institución de Banca Múltiple, Grupo
Financiero HSBC; HSBC Bank Brasil SA – Banco Múltiplo; HSBC Bank Australia Limited; HSBC Bank Argentina SA; HSBC
Saudi Arabia Limited; The Hongkong and Shanghai Banking Corporation Limited, New Zealand Branch incorporated in
Hong Kong SAR; The Hongkong and Shanghai Banking Corporation Limited, Bangkok Branch
Issuer of report
The Hongkong and Shanghai Banking Corporation
Limited
Level 19, 1 Queen’s Road Central
Hong Kong SAR
Telephone: +852 2843 9111
Fax: +852 2596 0200
Website: www.research.hsbc.com
This document has been issued by The Hongkong and Shanghai Banking Corporation Limited (“HSBC”) in the conduct of its Hong Kong regulated business for the information of its institutional
and professional investor (as defined by Securities and Future Ordinance (Chapter 571)) customers; it is not intended for and should not be distributed to retail customers in Hong Kong. The
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HSBC Securities (USA) Inc. accepts responsibility for the content of this research report prepared by its non-US foreign affiliate. All U.S. persons receiving and/or accessing this report and
wishing to effect transactions in any security discussed herein should do so with HSBC Securities (USA) Inc. in the United States and not with its non-US foreign affiliate, the issuer of this report.
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301737) for the general information of its “wholesale” customers (as defined in the Corporations Act 2001). Where distributed to retail customers, this research is distributed by HSBC Bank
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In Canada, this document has been distributed by HSBC Bank Canada and/or its affiliates. Where this document contains market updates/overviews, or similar materials (collectively deemed
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© Copyright 2016, The Hongkong and Shanghai Banking Corporation Limited, ALL RIGHTS RESERVED. No part of this publication may be reproduced, stored in a retrieval system, or
transmitted, on any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of The Hongkong and Shanghai Banking
Corporation Limited. MICA (P) 073/06/2015 and MICA (P) 021/01/2016
[499381]
Global
Analyst, Global Sector Head
Stephen Howard +44 20 7991 6820
stephen.howard@hsbcib.com
Europe
Analyst
Nicolas Cote-Colisson +44 20 7991 6826
nicolas.cote-colisson@hsbcib.com
Analyst
Antonin Baudry +33 1 56 52 43 25
antonin.baudry@hsbc.com
Analyst
Christopher Johnen +49 211 910 2852
christopher.johnen@hsbc.de
Analyst
Dominik Klarmann, CFA +49 211 910 2769
dominik.klarmann@hsbc.de
Analyst
Sebastian Grabert +49 211 910 1096
sebastian.grabert@hsbc.de
Analyst
Luigi Minerva +44 20 7991 6928
luigi.minerva@hsbcib.com
Analyst
Olivier Moral +33 1 5652 4322
olivier.moral@hsbc.com
Analyst
Adam Fox-Rumley +44 20 7991 6819
adam.fox-rumley@hsbcib.com
Analyst
Dhiraj Saraf, CFA +91 80 3001 3773
dhirajsaraf@hsbc.co.in
Americas
Analyst
Christopher A Recouso +1 212 525 2279
christopher.a.recouso@us.hsbc.com
Analyst
Sunil Rajgopal +1 212 525 0267
sunilrajgopal@us.hsbc.com
Global Emerging Markets (GEMs)
Analyst
Hervé Drouet +44 20 7991 6827
herve.drouet@hsbcib.com
Emerging Europe, Middle East & Africa (EMEA)
Analyst
Levent Bayar +90 212 376 46 17
leventbayar@hsbc.com.tr
Analyst
Eric Chang +971 4 423 6554
erichy.chang@hsbc.com
Asia
Analyst
Yogesh Aggarwal +91 22 2268 1246
yogeshaggarwal@hsbc.co.in
Analyst
Vivek Gedda +91 22 6164 0693
vivekgedda@hsbc.co.in
Analyst
Neale Anderson +852 2996 6716
neale.anderson@hsbc.com.hk
Analyst
Angela Tay +65 6658 0612
angela.h.y.tay@hsbc.com.sg
Analyst
Joyce Chen +8862 6631 2862
joycechchen@hsbc.com.tw
Analyst
Jenny Lai +8862 6631 2860
jennylai@hsbc.com.tw
Analyst
Lionel Lin +65 6658 0624
lionelylin@hsbc.com.sg
Analyst
Carrie Liu +8862 6631 2864
carriecfliu@hsbc.com.tw
Analyst
Steven C Pelayo +852 2822 4391
stevenpelayo@hsbc.com.hk
Analyst
Ricky Seo +822 37068777
rickyjuilseo@kr.hsbc.com
Analyst
Rajiv Sharma +91 22 2268 1239
rajivsharma@hsbc.co.in
Analyst
Jerry Tsai +8862 6631 2863
jerrycytsai@hsbc.com.tw
Analyst
Chi Tsang +852 2822 2590
chitsang@hsbc.com.hk
Analyst
Terry Chen +852 2996 6635
terry.q.chen@hsbc.com.hk
Analyst
Rajesh Raman +65 6658 0608
rajeshraman@hsbc.com.sg
Analyst
Yolanda Wang +8862 6631 2867
yolandayywang@hsbc.com.tw
Analyst
Jena Han +822 3706 8772
jenahan@kr.hsbc.com
Analyst
Will Cho +822 3706 8765
will.cho@kr.hsbc.com
Analyst
John Liu +852 2822 4392
john.q.liu@hsbc.com.hk
Associate
Alice Cai +852 2996 6584
alice.y.cai@hsbc.com.hk
Associate
Louis Pang +852 2914 9934
louis.w.h.pang@hsbc.com.hk
Associate
Qin Wang +852 2822 4393
qin1.wang@hsbc.com.hk
Associate
Kenneth Shim +822 3706 8779
kennyshim@kr.hsbc.com
Associate
David Huang +886 2 66312865
david.s.huang@hsbc.com.tw
Specialist Sales
Gareth Hollis +44 20 7991 5124
gareth.hollis@hsbcib.com
Tarun Viswanathan +44 20 7991 7843
tarun.viswanathan@hsbc.com
Kubilay Yalcin +49 211 9104880
kubilay.yalcin@hsbc.de
Myles McMahon +852 2822 4676
mylesmacmahon@hsbc.com.hk
Global Telecoms, Media & Technology
Research Team
