Nomura Large Cap Growth Fund on Taiwan Semiconductor Manufacturing Co. Ltd.
Thesis
Taiwan Semiconductor was a major positive contributor and is viewed as the dominant manufacturer of leading-edge semiconductors. The fund sees TSMC as a critical bottleneck in advanced chip production, which supports strong demand visibility and pricing power. Its growth opportunity is substantial as leading-edge capacity remains scarce. The principal constraint identified by the fund is the pace at which the company can expand capacity.
“the company enjoys high visibility, pricing power, and growth limited only by capacity expansion”
Key risks
- Growth is constrained by the pace of capacity expansion.
- A broader slowdown in AI infrastructure spending could reduce leading-edge semiconductor demand.