ASM Pacific 522

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ASM PACIFIC: No Guidance for 3Q New Orders given Uncertainties

The economic performance, consumer sentiment and semiconductor demand, were impacted by lockdown measures worldwide in wake of pandemic, said ASM PACIFIC (00522.HK) CEO Robin Gerard Ng Cher Tat.

Customers of semiconductor industry become more cautious in investment, while some of them even postpone or cancel their orders.

Under murky environment, the group decided not to outline guidance for its 3Q20 orders, whilst that of 3Q20 revenue ranges US$480-560 million.

New orders in 2H20 may accelerate given higher 5G demand, although traditionally it will reduce in 2H20 from 1H20 for seasonal factors.

The long-term sustainable development of 5G was believed to become the key driver to the group's three pillar segment in future.

Source: AAStocks Financial News

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Semiconductors rake in profits

ASM Pacific Technology (0522) said its first-half net profit more than doubled from a year ago to HK$391 million, driven by rising 5G sector demand despite pandemic and political uncertainties.

Earnings per share were HK$0.95 for the first half and the company declared an interim dividend of 70 HK cents.

Revenue grew 5.9 percent year-on-year to US$992 million (HK$7.74 billion).

The semiconductor beck-end equipment maker has introduced strategic investors to a joint venture, which is expected to generate a US$110 million net profit.

This came as Semiconductor Equipment and Materials International forecast that the global semiconductor packaging materials market would grow from US$17.6 billion in 2019 to US$20.8 billion in 2024, a compound annual growth rate of 3.4 percent, driven by the growth of the chip industry.

Source: The Standard

https://www.thestandard.com.hk/section- ... in-profits

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Short-term semiconductor demand shrink

2Q20 net profit recovered strongly.

We cut FY20F earnings forecast as semiconductor customers turn cautious in investment and cut some orders.

We believe rapid growth of China semiconductor supply chain, smartphone and automotive industry recovery, would boost performance in FY21F.

Reiterate Add, lower TP to HK$120.6 as FY20-22F core EPS cut by 8-28.4%.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 12F2EAD920

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Multiple catalysts ahead

Event

We initiate coverage on ASM Pacific Technology (ASMPT), the world’s leading semiconductor assembly and packaging equipment supplier and surface-mount technology (SMT) solution provider.

We expect ASMPT’s advanced packaging business to outgrow OSAT industry growth thanks to the advanced packaging growth trend and its diversified exposure to IDMs, foundries and OSAT, which will boost 2021F growth.

Impact

Rising demand on advanced packaging thanks to increasing 3DIC demand from leading IDMs & foundries. Advanced packaging technologies, such as the introduction of silicon interposers and the integration of HBM-memory or modularization through chiplet designs, are the rising trend, in which we’ve seen tremendous innovation over the past few years.

During 1H20, ASMPT’s advanced packaging sales already contributed 15% of its total sales, and we expect the growth trend will continue into 2021-22.

Aside from TCB, we also see hybrid bonding emerging on the back of thermal performance,
pin-count and throughput, and we expect TSMC (2330 TT, NT$436.0, OP) to ramp up its hybrid bonding technology soon in 2021.

We expect ASMPT’s backend business to see secular growth at a 25% sales CAGR during 2020-22F.

5G to drive SMT business upgrade.

ASMPT’s SMT business peaked out in 2018 as iPhone designs changed to substrate-like PCB. Despite rising auto electronics demand, AMPT’s SMT business has been muted in the past two years. With 5G picking up and high fine-pitch requirements for more advanced substrate designs such as SAP (semiadditive process), we expect SMT business decline to stabilize in 2021-22F.

Diversified business to overcome cyclical nature.

We note that ASMPT’s share price has been highly correlated to its booking momentum. Due to the COVID-19 outbreak, the company’s booking visibility has been low. Nevertheless, we expect a better outlook into 2021 thanks to a robust growth outlook in advanced packaging and the SMT upgrade cycle for 5G.

We expect a recouping capex cycle for the OSAT sector following strong momentum from upstream foundry makers, which will benefit ASMPT and bring an earnings recovery into 2021F.


Valuation & Action

ASMPT’s earnings have seen YoY growth recovery since 2Q20 and we see an intact outlook in 2021F, with 80% YoY earnings growth.


Trading at 20x our 2021 EPS estimate, at the cyclical low-end of the five-year average PE (26x), we think its current share price is attractive.

We initiate coverage on ASMPT with an Outperform rating and a target price of HK$123, based on 25x average 2021-22F EPS, in the mid-range of its historical PE band, versus peer average of 42x.

Risks
Slower-than-expected advanced packaging capex; economic downturn.

Source: KGI

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ASM PACIFIC (00522.HK) Shatters Privatization Rumors

ASM PACIFIC (00522.HK) is in talks with potential investors for proposed privatization, aiming to be relisted on Shanghai’s STAR Market with sharply higher valuations, as Reuters learnt from people with knowledge of the matter.

ASM PACIFIC has denied the news, whereas ASM International remains yet to respond.

Source: AAStocks Financial News

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Hong Kong-listed semiconductor maker ASM Pacific plans to go private — sources

by Kane Wu & Julie Zhu

HONG KONG (Sept 22): Hong Kong-listed semiconductor equipment manufacturer ASM Pacific Technology Ltd is in talks with potential investors to help take it private, people with direct knowledge of the matter told Reuters.

ASM is aiming to eventually relist itself on Shanghai's Nasdaq-like STAR Market to take advantage of its sharply higher valuations, said the people, who declined to be named as the information is confidential.

The company's parent Dutch chip maker ASM International NV , which holds about 25% of the Hong Kong arm, supports the proposal but doesn't plan to divest its stake, said one of the people.

ASM denied that it was planning to go private.

ASM International didn't immediately respond to a request for comment.

Based on ASM's current market value of $4.2 billion, a potential deal would cost outside investors at least $3.2 billion, without taking into account a premium paid on the stock price.

Hong Kong-listed companies have announced take-private deals worth $17.8 billion so far this year, more than double last year's annual volume, according to Refinitiv data, often citing undervalued shares as a reason for the deals.

The average premiums paid by buyers for those deals jumped to 46% in 2019 and this year, from 34% in 2018, the data showed.

ASM, which produces chip assembly and packaging machinery, has since earlier this year approached a number of private equity and venture capital firms in the hope they can help fund a buyout, the people said.

The company has also talked to several banks for the deal financing, said one of the people.

ASM's proposal comes as private equity interest in Chinese take-private deals is rising, with investors pouring money into new-economy companies listed on China's year-old STAR Market amid the intensifying Sino-U.S. tech war.

Companies raised $14.4 billion via IPOs on STAR in the first eight months of 2020, making it the second-biggest market globally, just behind Nasdaq, Refinitiv data showed, and ahead of New York and Hong Kong.

STAR Market-listed companies enjoy an average price to earnings of over 93 times, according to the Shanghai Stock Exchange. Eikon data showed Nasdaq 100 companies have an average PE of 35.84 times.

Beijing has been spending billions of dollars in an effort to speed up improvements to its domestic chip industry, a campaign which has gained fresh urgency as Washington intensifies pressure on Huawei.

Chinese investors have also driven the country's 45 listed chipmakers to over 100 times the companies' earnings, making semiconductors the priciest sector in the stock market.

Founded in 1975, Singapore-headquartered ASM claims to be the only company in the world that offers high-quality equipment for all major steps in the electronics manufacturing process - from carrier for chip interconnection to chip assembly and packaging to Image result for surface-mount technology (SMT).

It has been listed in Hong Kong since 1989 and counts China for half of its revenue, according to its website and filings.

Source: Reuters

https://www.theedgemarkets.com/article/ ... te-sources

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VOLUNTARY ANNOUNCEMENT

This is a voluntary announcement made by ASM Pacific Technology Limited (“ASMPT” or
the “Company”).

It has come to our attention that a Reuters article was published on 22 September 2020
alleging that ASMPT is talking with potential investors to help take the Company private.

We categorically state that the aforesaid allegation is untrue. The Company has not made any
such approach to any institution or organization.

There are no plans to take the Company private or to consider listing the Company elsewhere.
By Order of the Board
ASM Pacific Technology Limited
Robin Gerard Ng Cher Tat
Director

https://www1.hkexnews.hk/listedco/listc ... 200987.pdf

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July 6, 2020

Riding on semi equipment upcycle

World’s largest back-end semiconductor production equipment (SPE) supplier

Back-end SPE on an investment upcycle in 2021F

Beneficiary of supply chain localisation in China

Initiating coverage with BUY and TP of HK$118

We expect net profit to grow 27% in FY20F and climb 139% in FY21F, amid back-end semiconductor production equipment (SPE) investment upcycle starting 2021F.

Source: DBS

https://researchwise.dbsvresearch.com/R ... fdgekfhgbh

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ASM PACIFIC (00522.HK) 1-3Q Net Profit HK$620M, Up 54%

ASM PACIFIC (00522.HK) announced the first three quarters result ended September 2020.

The revenue rose 4.7% year on year to HK$11.969 billion.

The net profit amounted to HK$621 million, up 54.2%.

EPS was HK$1.52.

Source: AAStocks Financial News

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ASM PACIFIC: 4Q20E Gross Margin Flat QoQ; Upbeat on 5G Biz Outlook

In the light of macro uncertainties, ASM PACIFIC (00522.HK) has followed its peers and stopped making new order bookings and gross margin forecasts since the interim period, said CEO Robin Gerard Ng Cher Tat.

Stepping into a 5G equipment upgrade cycle, Ng noted a growing demand for high performance computing (HPC).

He was optimistic about the firm's business outlook, given more gear needed for 5G infrastructure upgrade and higher technological requirements.

Source: AAStocks Financial News