Welcome to this week’s edition of top stock market highlights.
Taiwan Semiconductor Manufacturing Company (NYSE: TSM)
Taiwan Semiconductor Manufacturing Company, or TSMC, plans to invest an additional US$100 billion in US plants to boost its chip output.
The world’s largest artificial intelligence (AI) chip manufacturing company is doing this to support President Trump’s goal of increasing domestic production of microchips.
TSMC CEO C.C. Wei accompanied Trump at the White House recently to unveil the company’s plans to expand its US footprint.
This spending is in addition to the US$65 billion that TSMC has committed to the US and could create thousands of new jobs for Americans.
TSMC is the main chip manufacturing partner for companies such as Nvidia (NASDAQ: NVDA) and Apple (NASDAQ: AAPL).
The company’s first plant in Arizona is up and running, and early production yields have surpassed the yields for its factories back in Taiwan.
Still, TSMC’s planned investments will require approval from the Taiwanese government.
Officials from Trump’s administration also asked TSMC to mull over taking up a stake in Intel Corporation’s (NASDAQ: INTC) factories.
Such a move aims to provide support for Intel as the company is facing deteriorating financials which caused it to cut jobs and stop its global expansion.
TSMC was not the only company to announce spending pledges.
A host of other companies including trillion-dollar heavyweights Apple and Meta Platforms (NASDAQ: META), along with OpenAI, have committed to invest more than US$1 trillion.
Mixue Group (HKSE: 2097)
The Hong Kong IPO market may be gearing up for a revival, judging by the enthusiastic response for Mixue Group’s recent IPO.
China’s largest bubble tea chain had offered shares at HK$202.50 apiece.
The stock saw huge demand from mom-and-pop investors who bid for thousands of times the shares they could buy, causing it to pop by 29% on its debut.
Mixue is capitalising on the rage for drinks such as bubble tea, which boasts a market set to surge to US$71 billion in three years.
Founded in 1997, the floating of Mixue’s shares caused the wealth of both the founder Zhang Hongchao and his brother Zhang Hongfu to leap to US$8.1 billion.
Mixue’s IPO is giving Hong Kong’s IPO market its best year since 2021, with another popular company, CATL, planning to go public soon.
CATL, which stands for Contemporary Amperex Technology Co, is a Chinese battery manufacturer founded in 2011.
As of 30 September 2024, Mixue had 40,510 stores in China, a more than doubling of its number of stores from 19,731 back in 2021.
Its rapid expansion did not come at the expense of profits.
For the first nine months of 2024 (9M 2024), Mixue’s revenue rose 21.2% year on year to RMB 18.7 billion.
Gross profit improved by 32% year on year to RMB 6 billion while net profit surged 45.2% year on year to RMB 3.5 billion.
Its free cash flow more than doubled year on year from RMB 1.8 billion in 9M 2023 to RMB 3.9 billion in 9M 2024.
Nanofilm Technologies (SGX: MZH)
Nanofilm released its 2024 earnings which saw improved financials for the nanotechnology company.
The group’s revenue rose 15.4% year on year to S$204.3 million while gross profit increased by 15.7% year on year to S$75.9 million.
Net profit came in at S$7.5 million, more than doubling from 2023’s S$2.7 million.
Of its three divisions, the advanced materials business unit (AMBU), which made up 84.2% of 2024 revenue, saw its revenue rise 21.6% year on year to S$172.1 million.
The division enjoyed higher contributions flowing in from newly acquired 3C customers and the successful integration of its AxynTec acquisition.
Its nanofabrication business unit (NFBU) saw revenue increase by 12.4% year on year to S$18 million because of a higher allocation of its micro-lens array project.
Industrial equipment business unit (IEBU) saw revenue plunge by 38.5% year on year to S$11.3 million as the division experienced a slowdown in customer orders.
However, Nanofilm once again generated a free cash outflow.
This stood at S$28.8 million for 2024, slightly higher than the free cash outflow of S$24.3 million for 2023.
The nanotechnology company maintained its final dividend of S$0.0033 per share.
On the outlook, the group plans to launch decorative solutions for its industrial sub-division within AMBU to boost growth in the consumer products, automotive, and luxury segments.
Its expansion into different areas of the world has also allowed Nanofilm to be closer to customers’ supply chains and helped to broaden its customer base.
IEBU is optimistic that customer orders for equipment will recover this year.
As for NFBU, the division is broadening its solutions into new sectors.
It is also developing new inroads into automotive applications.
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Disclosure: Royston Yang owns shares of Apple and Meta Platforms.