1. July 19, 2011
Asia Pacific: Technology: Semiconductors
Equity Research
Another inventory correction: 3Q down, 4Q up; Buy TSMC (on CL)
3Q outlook: Wafer -10% qoq, but packaging and semi up qoq
OUR ASIA-PAC SEMI COVERAGE
We now estimate TSMC/UMC revenues to decline 6.5%/12% qoq in 3Q11, due
to the recent order cuts across nearly all applications. Further, semi packaging Upside/downside
Stock & Ticker Rating 12m TP Price potential
orders have also weakened, but shipment is still tracking up 5% qoq in 3Q, TSMC (2330.TW) Buy* NT$90 NT$70.7 27.3%
TSMC ADS (TSM) Buy* US$15 US$12.2 23.0%
consistent with semi industry leader Fairchild’s 3Q guidance. For Mediatek and UMC (2303.TW) Neutral NT$14.9 NT$13.8 8.0%
UMC ADS (UMC) Sell US$2.6 US$2.4 8.3%
MStar, we expect rev to increase 12%-15% qoq with stable margins in 3Q11, Mediatek (2454.TW) Neutral NT$290 NT$258 12.4%
MStar (3697.TW) Buy NT$250 NT$157 59.2%
partially due to handset inventory restocking among Chinese handset makers.
Meanwhile, our Asia-Pacific tech hardware team estimates about 15% qoq Note: *denotes stock is on our regional Conviction List.
Stock prices are as of the market close of July 14, 2011.
increase in most PC OEMs orders in 3Q11. In terms of visibility, PC OEM/semi
packaging companies expect improving clarity in Aug/Sept. We revise our For important disclosures, please go to
http://www.gs.com/research/hedge.html.
2011E-2013E EPS for our coverage by -27.3% to +1.8% to reflect inventory
Source: Datastream, Gao Hua Securities Research
correction, competition. Consequently, we lower our 12-m TPs by up to -14%. estimates.
UPCOMING EVENTS
Inventory correction to end in 3Q; demand to pick up in 4Q
We attribute the inventory correction in 3Q11 to overstocking post the Japan CY2Q11 result reporting schedule
Company Name Ticker Date
earthquake, soft demand, and macro concerns leading to minimal inventory. TSMC 2330.TW Thursday, July 28
UMC 2303.TW Wednesday, August 3
On a positive note, downstream is trending much better than upstream— Mediatek 2454.TW Wednesday, July 27
indicating effective inventory clearing—Chinese handset makers have started MStar 3697.TW Early August
to re-stock; Nokia component order should recover in late 3Q11 based on our Source: Company data
supply chain checks; and CNY is early in 2012 (late January).
Maintain Buy (on CL) on TSMC
We note that TSMC outperformed when its utilization was low (as seen
since late-April, TSMC +2% (incl. cash div) vs. TAIEX -6%). We expect
TSMC’s capex to decrease from US$7.8 bn/US$6.5 bn to US$6.9 bn/US$6
bn in 2011E/2012E given the inventory correction, potentially alleviating
market concerns over excess foundry capacity. We think TSMC’s 28 nm
capacity is on track to reach 10K WPM by end of 2011 for the next wave of
mobile computing and arrival of ARM-CPU. In our view, TSMC’s upcoming
3Q guidance should help remove uncertainty over the demand outlook.
Mediatek: Muted seasonal growth in 3Q11; maintain Neutral
Our supply chain checks indicate healthy demand for 6252 (low-cost SOC) and
6236 (EDGE smart feature phone), while 6253 is being potentially phased out.
We expect Mediatek’s rev to increase 14% qoq in 3Q11 due to seasonality and
a lacklustre 2Q. Mediatek has recently cut 6252/6253 prices, but its overall ASP,
margin should remain stable due to increasing share of 6236 in the mix.
Donald Lu, Ph.D Goldman Sachs does and seeks to do business with
+86(10)6627-3123 donald.lu@ghsl.cn Beijing Gao Hua Securities Company Limited
Lingling Hu
companies covered in its research reports. As a result,
+86(10)6627-3520 lingling.hu@ghsl.cn Beijing Gao Hua Securities Company Limited investors should be aware that the firm may have a conflict of
Evan Xu interest that could affect the objectivity of this report. Investors
+86(10)6627-3176 evan.xu@ghsl.cn Beijing Gao Hua Securities Company Limited
should consider this report as only a single factor in making
their investment decision. For Reg AC see the end of the text.
For other important disclosures, see the Disclosure Appendix,
or go to www.gs.com/research/hedge.html. Analysts
employed by non-US affiliates are not registered/qualified as
research analysts with FINRA in the U.S.
The Goldman Sachs Group, Inc. Global Investment Research
2. July 19, 2011 Asia Pacific: Technology: Semiconductors
TSMC (2330.TW, Buy, on Conviction List)
TSMC reported in-line 2Q11 sales of NT$110.5 bn (+4.9% qoq, +5.3% yoy), nearly
reaching the high end of its guidance of NT$109-$111 bn. We expect TSMC to meet its
margin guidance in 2Q11, as well.
We estimate TSMC’s rev to decline 6.5% qoq in 3Q11 due to recent order cut across
nearly all applications based on our industry checks. Therefore, we now forecast
TSMC’s utilization rate to decline from 100% in 1Q11 to 98%/87% in 2Q11/3Q11,
respectively. We attribute the 3Q weakness to inventory clearing after the restocking post
the Japan earthquake, softening demand especially in Europe, and concerns over
deteriorating economic growth leading to minimal inventory. In 3Q11, we expect foundry rev
correction of 10% qoq vs. packaging (up 5% qoq), Mediatek and MStar (up 10%+ qoq), and
most PC OEM’s current PC orders (up 15%-20% qoq). We believe this inventory correction
is a typical pattern in the semiconductor supply chain.
We still expect the correction to end mostly in 3Q11 and foundry wafer shipment to
increase qoq in 4Q11 despite a weaker-than-expected 3Q11 for five reasons: (1) Most
Chinese handset makers have cleared their excess inventory in 2Q11 so that their demand
should increase almost seasonally in 3Q and 4Q11; (2) Nokia’s inventory correction should
complete mostly in 3Q11 based on our supply chain checks and Nokia demand should
normalize in 4Q11; (3) potential iPhone 5 introduction may stimulate iPhone replacement
demand; (4) Our Asia-Pacific tech hardware team has recently indicated that PC ODM
shipment is above expectations in 2Q11 and most PC OEMs (except Acer) expect 15%-20%
qoq growth in PC orders in 3Q11; and (5) wafer inventory clearing seems decisive in 3Q11
on the aforementioned pattern of bifurcation of 3Q growth between upstream and
downstream companies.
We expect TSMC capex to decrease from US$7.8 bn/US$6.5 bn to US$6.9 bn/US$6
bn in 2011E/2012E, respectively given the inventory correction, alleviating some
market concerns of foundry excess capacity. We note that GlobalFoundries (GF) has
recently had a senior management restructuring partially due to weak execution in R&D, 32
nm yield, and 28 nm qualification. In addition, SMIC announced on July 18 that its COO has
been promoted as SMIC’s chairman, Executive Director and acting CEO with effect from
July 15. In our view, these recent management issues at GF and SMIC may result in
reducing the effectiveness of capex, potentially alleviating concerns over excess supply in
the near term. Furthermore, our new capex assumptions indicate TSMC’s depreciation
increasing 30% in 2011E (which could be a cause for market concern) would decline to
5.5% in 2012E.
We view 28nm dominance, mobile computing for smartphone and tablet, and ARM-based
CPU for PC as TSMC’s major growth drivers in 2012E-2013E. We think TSMC’s 28nm
capacity is on track to reach 10K WPM by end of 2011 for the next wave of mobile
computing and arrival of ARM-CPU. In our view, GF or Samsung not having any significant
foundry design-wins at 28nm may be partially due to their choice of gate-first technology.
We expect 28nm to be TSMC’s fastest ramping node and believe that 28nm should
generate healthier returns than 40nm node.
Historically, we note that TSMC’s stock troughed at the beginning of each inventory
correction and outperformed when its utilization was low (since late April, TSMC +2% (incl.
cash div of NT$3 per share) vs. TAIEX -6%). The stock outperformed TAIEX from
September 2008 to March 2009 when utilization rate had troughed (see Exhibit 2). In our
view, TSMC’s upcoming 3Q guidance should help remove the uncertainty over the demand
outlook.
We revised our 2011E-2013E EPS by -6.3% to +1.8% to reflect inventory correction.
Consequently, we lower our 12-month P/E-based TP for TSMC/ADS by 1% to NT$90/US$15.
Key risks include USD depreciation.
Goldman Sachs Global Investment Research 2
3. July 19, 2011 Asia Pacific: Technology: Semiconductors
Exhibit 1: We revise down our EPS for 3Q11E by 14.6% due to worse-than-expected
inventory correction
TSMC estimates revisions
TSMC 3Q2011E 2011E 2012E 2013E
New Old Diff. New Old Diff. New Old Diff. New Old Diff.
Revenue (NT$ mn) 103,266 112,794 -8.4% 430,781 449,011 -4.1% 499,513 529,289 -5.6% 560,010 573,321 -2.3%
Gross margin (%) 43.0% 45.0% -197bps 45.9% 46.6% -67bps 47.4% 46.4% 99bps 45.6% 43.7% 188bps
Operating margin (%) 30.2% 33.3% -305bps 33.8% 35.0% -116bps 35.7% 35.4% 33bps 34.1% 32.5% 161bps
Net margin (%) 28.1% 30.1% -204bps 31.0% 31.7% -74bps 31.8% 31.4% 34bps 30.1% 28.9% 121bps
EPS (NT$)-local $1.12 1.31 -14.6% 5.15 5.49 -6.3% 6.12 6.42 -4.6% $6.50 6.38 1.8%
Source: Goldman Sachs Research estimates.
Exhibit 2: We note that TSMC stock has generally troughed at the beginning of the first
quarter of declining utilization
TSMC stock price vs. utilization rate
120% 90
TSMC Quarterly Utilization Rate (LHS) TSMC Stock Price (RHS)
110% 80
100%
70
90%
60
Close Price (NT$)
Utilization rate
80%
50
70%
40
60%
30
50%
20
40%
30% 10
20% 0
Jan-94
Nov-94
Jan-97
May-98
Sep-99
Jun-01
Jan-04
May-05
Sep-06
Feb-07
Jan-08
Nov-08
May-09
Jun-94
Aug-96
Jul-97
Feb-00
Jan-01
Nov-01
Aug-03
Jul-04
Aug-07
Jun-08
Dec-11
Mar-96
Dec-97
Jul-00
Mar-03
Dec-04
Aug-10
Feb-11
Apr-95
Oct-95
Oct-98
Apr-99
Apr-02
Oct-02
Oct-05
Apr-06
Oct-09
Mar-10
Jul-11
Source: Datastream, company data, Goldman Sachs Research estimates.
Exhibit 3: We also note that TSMC’s stock outperformed when its utilization was low and
underperformed when it reached 100%
TSMC relative performance vs. utilization rate
120% 4.5
TSMC Quarterly Utilization Rate (LHS) TSMC relative performance to TWSE index (RHS)
110% 4.0
100%
3.5
90%
Relative performance
3.0
Utilization rate
80%
2.5
70%
2.0
60%
1.5
50%
1.0
40%
30% 0.5
20% 0.0
Nov-94
Nov-08
Jan-94
Aug-96
Jan-97
May-98
Sep-99
Jun-01
Aug-03
Jan-04
May-05
Sep-06
Feb-07
Aug-07
Jan-08
May-09
Nov-01
Jun-94
Jul-97
Feb-00
Jan-01
Jul-04
Jun-08
Dec-11
Mar-96
Dec-97
Jul-00
Mar-03
Dec-04
Aug-10
Feb-11
Apr-95
Oct-95
Oct-98
Apr-99
Apr-02
Oct-02
Oct-05
Apr-06
Oct-09
Mar-10
Jul-11
Source: Datastream, company data, Goldman Sachs Research estimates.
Goldman Sachs Global Investment Research 3
4. July 19, 2011 Asia Pacific: Technology: Semiconductors
UMC (2303.TW, Neutral)
UMC reported 2Q11 parent sales of NT$28.15 bn (+0.1% qoq, -5.4% yoy), slightly above GS
forecast of NT$27.67 bn (-1.6% qoq, -7% yoy) and met company’s guidance of a flattish
quarter during the 1Q11 earnings release. We expect UMC’s 2Q GPM to be largely in line
with guidance at low-mid 20% and utilization rate at around 85% with 8” slightly higher
than 12”.
UMC is holding a conservative view about the 3Q11 outlook and has indicated that growth
in 3Q is not likely to match the seasonal level due to macro slowdown concerns. The
company noted that overall demand has not been strong since 2Q—relatively stable for
STB, Digital TV, and handset components, but ODD is showing slowdown during the past
few weeks. Communication (Baseband, Broadband, wireless infrastructure) demand is
weak as well. We estimate UMC’s 3Q revenue to decline 12% qoq, partially due to its large
exposure to Nokia.
The company indicated that ASP for 65nm and above has been under pressure as the
customers have more bargain power, while ASP of 40nm is relatively stable. So far, UMC
has 45 tape-outs in 40nm, 22 in production and 16 customers. The company maintains its
guidance that 40nm would account for 10% of total revenue in 2H11. Besides, UMC expects
pilot production for one client in 28nm in 3Q11.
We estimate that UMC would recognize higher non-operating income in 3Q due to the
dividend income from its non-core holdings in Farady, SiS, and Novatek, etc. We are also
reducing our capex estimates from US$1.8 bn/US$1.2 bn to US$1.5 bn/US$800 mn at UMC
in 2011E and 2012E, respectively given the inventory correction.
UMC has higher leverage than TSMC and has generally lost market share to TSMC when
the industry saw a correction in inventory. We expect UMC’s stock to be lacklustre as the
demand outlook remains uncertain and would await their 3Q guidance in late July/early
August. In near term, we think the stock may see some weakness during the earnings
season.
We lower our 2011E-2013E EPS by 2%-27% to reflect inventory correction and market share
loss. Consequently, we lower our 12-month P/B-based TP by 1% to NT$14.9. Risks: Upside -
strong IDM outsourcing; downside – market share loss in 40nm and 28nm.
Exhibit 4: We cut our estimates to reflect the demand and ASP pressures
UMC estimates revisions
UMC 3Q2011E 2011E 2012E 2013E
New Old Diff. New Old Diff. New Old Diff. New Old Diff.
Revenue (NT$ mn) 24,688 28,675 -13.9% 107,789 115,635 -6.8% 119,687 131,572 -9.0% 128,310 136,316 -5.9%
Gross margin (%) 14.4% 22.3% -798bps 20.9% 24.6% -371bps 21.7% 23.8% -207bps 21.7% 21.7% 0bps
Net margin (%) 8.6% 12.9% -430bps 10.4% 13.3% -293bps 10.7% 12.5% -179bps 10.6% 10.2% 44bps
EPS (NT$)-local 0.17 0.30 -42.6% 0.90 1.23 -27.3% 1.03 1.33 -22.1% 1.10 1.12 -2.0%
Wafer Shipment (K unit 1,004 1,131 -11.2% 4,339 4,582 -5.3% 4,812 5,239 -8.1% 5,319 5,609 -5.2%
Utilization rate 74.7% 84.2% -946bps 82.4% 86.9% -455bps 86.8% 93.4% -654bps 91.9% 95.1% -324bps
Source: Goldman Sachs Research estimates.
Mediatek (2454.TW, Neutral)
Mediatek released June quarter sales of NT$20.96 bn (+5.5% qoq, -30% yoy), in line with
our estimate of NT$20.8 bn (+4.7% qoq, -30.6% yoy), at the low end of its guidance of
NT$20.9bn-22.3bn.
Our supply chain checks indicate that demand for 6252 (low cost SOC) and 6236
(EDGE smart feature phone solution) has been healthy, while 6253 is being
Goldman Sachs Global Investment Research 4
5. July 19, 2011 Asia Pacific: Technology: Semiconductors
potentially phased out. We believe demand should improve significantly qoq in 3Q11 due
to seasonal demand and a low base in 2Q11 when the industry had liquidated inventory
and went through restructuring. Mediatek also recently cut prices on 6252 and 6253 to
compete with Spreadtrum and MStar. But, we expect its overall handset ASP and margins
to remain stable due to increasing higher-ASP 6235/6236 in the product mix. Mediatek
indicated that the mix of 6235/6236 should increase from 15% in 1Q11 to 20% in 2Q11. We
forecast Mediatek 3Q rev to increase 14% qoq in 3Q11.
Mediatek sampled the second smartphone platform (HSUPA, 3.75G, 650MHz processor)
with several clients in the second quarter and indicated that the customers may launch
products in the near term at the earliest. This second platform is based on Android 2.3 OS.
The company noted that it has shipped less than 2 mn smartphone so far in 2011, but
maintained its full year target of 10 mn smartphones, implying a back-end loaded year.
Mediatek also expects to ship 10mn WCDMA feature phones and 12mn TD chips.
Besides, the company is positive on the TV SOC market and expects it to be the highest
growth segment this year with a stable ASP outlook.
On July 13, Mediatek announced a new share buyback program of 8mn shares (0.73% of its
outstanding shares) at the price range of NT$247-371 within two months till Sep 13.
Mediatek shares have contracted significantly post its cash div ex-date. We believe that its
3Q guidance and share buyback should help stabilize the share price near-term. However,
the growth outlook of its 3G smartphone remains challenging due to Qualcomm’s
intensifying competition. Unless its smart feature phone shipment could reach 30%-40% of
product mix in the next 12 months, trading at 19X NTM consensus P/E, Mediatek’s
valuation appear to lackluster (sector at 13.5X 2011E P/E), in our view. We maintain our
Neutral rating.
We lower our 2011E-2013E EPS by 2%-7% to reflect increasing competition. Consequently,
we lower our 12-month P/E-based TP by 5% to NT$290. Key Risks: upside – fast
smartphone adoption in emerging countries; downside – intensifying 2G competition.
Exhibit 5: We lower our estimates due to weak demand in low-end feature phones and
ASP pressure due to competition
Mediatek estimates revisions
Mediatek estimates 3Q2011E 2011E 2012E 2013E
(GAAP) New Old Diff. New Old Diff. New Old Diff. New Old Diff.
Revenue (NT$ mn) 23,900 24,863 -3.9% 89,221 90,680 -1.6% 102,491 106,641 -3.9% 106,448 110,740 -3.9%
Gross margin (%) 46.8% 47.1% -102bps 46.6% 47.1% -50bps 47.4% 48.9% -146bps 47.4% 48.9% -149bps
Operating margin (%) 19.3% 19.6% -340bps 17.8% 18.2% -45bps 20.7% 21.9% -124bps 21.3% 22.6% -127bps
Net margin (%) 19.3% 19.6% -321bps 18.1% 18.5% -42bps 19.8% 21.0% -113bps 20.3% 21.5% -114bps
EPS (NT$) 4.25 4.41 -3.8% 14.89 15.24 -2.3% 18.74 20.12 -6.9% 19.95 21.22 -6.0%
Source: Goldman Sachs Research estimates.
MStar (3697.TW, Buy)
MStar’s 2Q11 sales stood at NT$8.35 bn (+1.8% qoq, +8.9% yoy), in line with our estimate
of NT$8.3bn (+1% qoq, +8% yoy), reaching the mid range of its revenue guidance of
NT$8.07bn-8.55bn.
MStar indicated that its orders have been within expectations and stable in the past two
weeks. The company indicated that 3Q is normally a seasonally high growth quarter, and
expects to outperform the industry growth average with stable margins. We note that the
European TV market has been muted and expect MStar’s 3Q rev to increase 12% qoq vs up
23% qoq in 3Q10.
Goldman Sachs Global Investment Research 5
6. July 19, 2011 Asia Pacific: Technology: Semiconductors
For the TV business, MStar indicated that its market share has increased among Japanese
brands, and remained stable at domestic Chinese TV brands and LG. Meanwhile, our
supply chain checks indicate that Novatek may have potentially secured Samsung’s (one of
MStar’s customers) TV orders, but this appears to have largely come at the expense of
Trident. MStar expects its overall TV market share to remain stable in 2011-2012.
Our channel checks indicate that MStar is making progress in the handset market.
Some of its major customers are ramping up volumes after testing its mid-range
solutions for several months. We forecast MStar to ship 12 mn chipsets in 3Q11.
MStar noted that handset shipment was up 30%-50% qoq in 2Q11, same as 1Q11, and
expects the momentum to continue throughout 2011. According to the company, handset
ICs contributed more than 5% of total revenue in 1H11 and is targeted to reach double digit
revenue share for this year. MStar sampled TD IC with clients in 2Q11 and expects mass
production in 4Q11 or early next year. The company also noted the expansion of its
handset business in the emerging markets such as in India, where the number of
customers increased significantly. Currently more than 50% of its handset shipment is for
markets outside of China. MStar aims to sample its smartphone IC in 4Q11. But we believe
that MStar’s handset cost is not competitive with that of Mediatek and so a fast handset
volume ramp up could potentially have negative impact on margins. We lower our handset
shipment forecasts from 45mn/120mn to 44mn/88mn in 2011E and 2012E, respectively.
MStar announced another share buyback plan for 6mn shares till the end of July after it
bought back 4mn during the last round from Jan 24 to Mar 18. It has completed 3.86mn out
of the 6mn shares by June 24.
We note that 40% of its shares were locked up immediately after its IPO in Dec 2010, of
which 15% were unlocked 3 months post IPO in late March 2011 (among which 7%-8%
were MStar employee shares). Around 10% is held by management and locked for two
years. The rest 15% are held by institutional and other investors and would gradually
unlocked through 3 months to 2 years post IPO. Upon its initial listing, employee shares
accounted for about 50% of its total shares (10%-15% were locked up) and currently
employees hold about 40% of the stake (10% is locked up). The company noted that it has
not seen any significant shareholding changes yet.
Despite our earnings cut, we maintain Buy on MStar based on its high ROE and healthy
new product portfolio. We lower our 2011E-2013E EPS by 4%-13% to reflect slower-than-
expected ramp up in handset segment. Consequently, we lower our 12-month TP by 14%
to NT$250. Our TP is based on 14X NTM P/E, down from 16.5X as we estimate lower
earnings growth CAGR (19% vs. previously 24%) for 2011E-2013E. Key risks include slower
than expected volume ramp up in the handset market.
Exhibit 6: We cut our MStar estimates due to its slower than expected ramp up in
handsets segment
MStar estimates revisions
MStar estimates 3Q2011E 2011E 2012E 2013E
New Old Diff. New Old Diff. New Old Diff. New Old Diff.
Revenue (NT$ mn) 9,332 9,561 -2.4% 35,976 38,150 -5.7% 42,550 48,017 -11.4% 46,501 54,899 -15.3%
Gross margin 41.7% 41.6% 0.1% 41.6% 41.6% 0.0% 41.8% 41.5% 0.3% 42.0% 41.7% 0.3%
Operating margin 19.8% 19.7% 0.1% 19.8% 19.9% -0.1% 21.4% 21.1% 0.2% 21.7% 21.5% 0.2%
Net margin 19.7% 18.8% 0.9% 19.7% 19.1% 0.5% 21.1% 20.2% 1.0% 21.4% 20.5% 0.9%
Diluted EPS (NT$) 3.81 3.73 2.3% 14.58 15.12 -3.5% 18.47 19.96 -7.4% 20.15 23.05 -12.6%
Diluted share account (mn) 483 483 0.0% 485 483 0.5% 487 485 0.3% 495 488 1.4%
Source: Goldman Sachs Research estimates.
Goldman Sachs Global Investment Research 6
8. July 19, 2011 Asia Pacific: Technology: Semiconductors
Reg AC
I, Donald Lu, Ph.D, hereby certify that all of the views expressed in this report accurately reflect my personal views about the subject company or
companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific
recommendations or views expressed in this report.
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market. The four key attributes depicted are: growth, returns, multiple and volatility. Growth, returns and multiple are indexed based on composites
of several methodologies to determine the stocks percentile ranking within the region's coverage universe.
The precise calculation of each metric may vary depending on the fiscal year, industry and region but the standard approach is as follows:
Growth is a composite of next year's estimate over current year's estimate, e.g. EPS, EBITDA, Revenue. Return is a year one prospective aggregate
of various return on capital measures, e.g. CROCI, ROACE, and ROE. Multiple is a composite of one-year forward valuation ratios, e.g. P/E, dividend
yield, EV/FCF, EV/EBITDA, EV/DACF, Price/Book. Volatility is measured as trailing twelve-month volatility adjusted for dividends.
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GS SUSTAIN
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Disclosure Appendix
Coverage group(s) of stocks by primary analyst(s)
Compendium report: please see disclosures at http://www.gs.com/research/hedge.html. Disclosures applicable to the companies included in this
compendium can be found in the latest relevant published research.
Company-specific regulatory disclosures
Compendium report: please see disclosures at http://www.gs.com/research/hedge.html. Disclosures applicable to the companies included in this
compendium can be found in the latest relevant published research.
Distribution of ratings/investment banking relationships
Goldman Sachs Investment Research global coverage universe
Rating Distribution Investment Banking Relationships
Buy Hold Sell Buy Hold Sell
Global 32% 54% 14% 52% 41% 37%
As of July 1, 2011, Goldman Sachs Global Investment Research had investment ratings on 3,167 equity securities. Goldman Sachs assigns stocks as
Buys and Sells on various regional Investment Lists; stocks not so assigned are deemed Neutral. Such assignments equate to Buy, Hold and Sell for
the purposes of the above disclosure required by NASD/NYSE rules. See 'Ratings, Coverage groups and views and related definitions' below.
Price target and rating history chart(s)
Compendium report: please see disclosures at http://www.gs.com/research/hedge.html. Disclosures applicable to the companies included in this
compendium can be found in the latest relevant published research.
Goldman Sachs Global Investment Research 8
9. July 19, 2011 Asia Pacific: Technology: Semiconductors
Regulatory disclosures
Disclosures required by United States laws and regulations
See company-specific regulatory disclosures above for any of the following disclosures required as to companies referred to in this report: manager
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managed public offerings in prior periods; directorships; for equity securities, market making and/or specialist role. Goldman Sachs usually makes a
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Goldman Sachs Global Investment Research 9
10. July 19, 2011 Asia Pacific: Technology: Semiconductors
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Goldman Sachs Global Investment Research 10
