This Taiwanese manufacturer is now Asia’s most valuable company after China’s crackdown on big tech firms

FILE PHOTO - A logo of Taiwan Semiconductor Manufacturing Co (TSMC) is seen at its headquarters in Hsinchu, Taiwan August 31, 2018. Picture taken August 31, 2018. REUTERS/Tyrone Siu
A logo of Taiwan Semiconductor Manufacturing Co (TSMC) is seen at its headquarters in Hsinchu Reuters
  • Taiwan Semiconductor Manufacturing Company, has surpassed Tencent to become Asia’s most valuable company.
  • The breaking point came on Tuesday when a dip in Tencent stock officially made TSMC the most valuable Asian company by market cap.
  • The company has doubled its share price since the start of the pandemic in March 2020.
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Taiwan Semiconductor Manufacturing Company, the world’s biggest semiconductor maker, has surpassed Tencent to become Asia’s most valuable company after Beijing’s harsh stance against Chinese tech battered Tencent and its peers.

Tencent shares have fallen nearly 30% since the beginning of June amid a smattering of new rules and regulatory efforts. That has let TSMC, whose share price has remained mostly flat since June, creep up on Tencent’s valuation.

The breaking point came on Tuesday when a dip in Tencent stock officially made TSMC the most valuable Asian company by market cap, at $579 billion on Wednesday. Tencent’s market cap was sitting around $557 billion, while Alibaba, the next biggest Asian company, came in at $481 billion.

TSMC has soared as overwhelming global demand for its wafers has hit industries from autos to gaming. During the pandemic, too, a rise in stay-at-home purchases like video game systems and computer gear made for bountiful business in the chip industry.

The company has doubled its share price since the start of the pandemic in March 2020 – during which time TSMC has declared several multi-billion dollar capex rounds, now totaling north of $100 billion.

Even still, the massive worldwide chip shortfall combined with the slow pace of ramping up production means business is set to boom for years.

TSMC’s market position, earning over half of global chip manufacturing revenue, is so dominant that some analysts have even argued the company could become a flashpoint in cross-strait relations between Taiwan and mainland China.

In July, TSMC chairman Mark Liu addressed fears around a potential Chinese invasion of Taiwan, which considers the island part of its territory.

“Everybody wants to have a peaceful Taiwan Strait. Because it is to every country’s benefit, but also because of the semiconductor supply chain in Taiwan – no one wants to disrupt it,” he said.