2002/11/07 Today¡¦s Top Stories
TSMC (2330 TT, BUY, NT$51.0)
October sales forecast to grow 6% MoM to NT$13.5bn (we had forecasted a 7% MoM decline
Rush orders from both IDM and fabless are major reasons
Might signal pre-Christmas demand
TSMC might report better than expected October sales of NT$13.5bn, up 6% MoM due to some rush orders coming through, which is surly good news in light of our previous forecast of a 7% MoM decline. However, the official October sales figure has not yet been released. We believe that the better than expected October sales were driven by increasing rush orders from Motorola, nVidia, STM, and VIA, among others. UMC reportedly has received quick orders from TI, MediaTek, and STM. Since both foundry makers have or are expected to receive quick orders, we see this as an indicator that Christmas demand may be picking up, which comes as a bit of a surprise since expectations had fallen so low. It is reported that Motorola increased their wafer orders from 35,000 per month to 40,000 per month currently. NVidia is also forecast to place rush orders to TSMC, although this has not been confirmed. Given October sales that may be better than expected, we reiterate our BUY recommendation on both TSMC and UMC.
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