[ET Net News Agency, 15 January 2021] Citi Research raised its target price for ASM
Pacific Technology (00522) to HK$130 from HK$107 and reaffirmed its "buy" rating.
The research house said TSMC guided upbeat 2021 capex of US$25-28bn (up 45-63%). The
breakdown of the guidance is 80% for advanced nodes, 10% for packaging and masking, 10%
for specialty. Citi believes this is an important event for ASM's 2021 and long-term
earnings growth as it is the direct beneficiary in advanced packaging.
TSMC mentioned automotive demand to grow higher than the corporate average (e.g., 15%)
in 2021. Citi expects this to benefit at least a half portion of the SMT (surface mount
technology) (40-50% of revenue and op profit) segment.
Citi kept its 2020 earnings forecast largely unchanged but raised its 2021/22 earnings
estimates by 21%/11% based on higher contribution from HPC (High Performance Computing)
and auto for ASM. (KL)