Morgan Stanley names stocks to capitalize on the upgraded supercycle in artificial intelligence | Wilnesh News
Morgan Stanley says the market is underestimating a corner of artificial intelligence. The bank explains that this is advanced semiconductor packaging, which includes the technology of packaging integrated circuits to “enhance functionality and performance and lay the foundation for more powerful and efficient artificial intelligence chips” – which is designed in semiconductor manufacturing and the final step after manufacturing. It added that it is the process of packaging wafers to protect them and enable them to be connected to external devices. Morgan Stanley said that innovation in the industry will drive the capabilities of artificial intelligence chips. The report said that as artificial intelligence becomes increasingly popular, packaging is a “key means” to improve processing capabilities. “Unlike the traditional electronic packaging of PCs or smartphones, today’s AI systems require (graphics processing units), CPUs, high-bandwidth memory (HBM), I/O controllers and other components to operate at extremely fast speeds and with energy-saving efficiency. “Packaging, previously considered a ‘back-end’ and cost center, is now the primary way to improve performance as manufacturers strive to expand geometries to achieve profitability,” they said. “Engineers have realized that they can use all parts of the die, including the packaging, to improve performance. ” Morgan Stanley predicts that the advanced packaging market will be worth $116 billion by 2027, calling it an “upgrade super cycle” driven by artificial intelligence’s “insatiable appetite for computing power, memory and even new chip architectures” “Demand” drives. “We believe the market is underestimating the pace of innovation and its impact on growth,” the bank said. ” Morgan Stanley said it sees Japan, South Korea and the European Union as “huge winners.” It earmarks stocks to play into the advanced packaging trend, adding that they fall into one of two categories: technology companies at the forefront of artificial intelligence computing and companies that benefit from the packaging supply chain. Here’s what the bank has to say about some of its options. Amkor, USA: Morgan Stanley said the company will be “uniquely positioned” to benefit from the outsourced semiconductor assembly and test services industry (OSAT), which is in a “transformational moment.” The bank noted that the company plans to build an advanced packaging and testing facility in Arizona, where chips produced for Apple will then be packaged and tested at a nearby TSMC plant. “Amkor intends to build more than 500,000 square feet of clean room space with the goal of having it ready for production within the next 2-3 years,” Morgan Stanley said, referring to a highly controlled semiconductor manufacturing environment. “This will position Amkor as a leading end-to-end production enabler in the country.” ACM Research: The bank noted that SK Hynix, the world’s second-largest memory chip maker, is an important customer of ACM Research. The company said that if ACM can provide copper plating and advanced packaging products for SK Hynix’s high-bandwidth memory production line, the company’s business may have room for growth. This is expected to happen when SK Hynix’s HBM4 product is launched. It started production of the HBM3E earlier this year. TSMC, Taiwan: Morgan Stanley noted that the Taiwanese semiconductor company is a major supplier of CoWoS technology, a packaging technology. It pointed out that 6%-7% of TSMC’s total revenue in 2023 will come from advanced packaging and testing. But Morgan Stanley predicts that number will exceed 10% by 2024, with the company more than doubling its capacity for the technology this year. The bank added: “TSMC continues to develop different advanced packaging technologies to meet the different needs of customers.” AP Memory: Memory bandwidth and power consumption are critical for AI computing, and the company’s packaging technology may be the first to provide An “effective” solution to this problem, as it can achieve 10 times the memory bandwidth and 90% reduction in power consumption of HBM2E technology, which is a high-bandwidth storage technology. Morgan Stanley Japan said that among all companies in Japan that produce advanced packaging equipment, it favors Disco and Advantest the most. Disco is pursuing a strategy to maintain its position as a “highly profitable company” by being ahead of other companies in providing “appropriate solutions”, the company said. It added that Advantest is likely to benefit from “strong growth” in the advanced packaging tester market this decade. —CNBC’s Michael Bloom contributed to this report.
