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Greater China Strategy / China Healthcare / China Property
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Strategy | Taiwan Tech: Strong Growth Outlook; Supply And Ramp Execution Remain Key
We organised a Taiwan trip last week, which included meetings with TSMC and MediaTek. Both companies highlighted strong multi-year AI demand, but continued constraints in leading-edge capacity, substrates and advanced packaging limit near-term growth and margins. Looking ahead, TSMC expects N2 to become highly profitable and it could ultimately generate higher margins than 3nm, while MediaTek’s AI ASIC business is expected to become a key growth engine.
Sector Update | China Healthcare
Most healthcare companies beat 1H26 expectations, led by drug innovators and CRDMOs on strong sales and licensing revenue. Medical device firms face ongoing VBP and anti-corruption pressure in China, but globalisation will fuel growth through 2026 and beyond. Maintain MARKET WEIGHT; our top picks are Innovent, BeOne, Hansoh Pharma, WuXi AppTec, WuXi Bio and Edge Medical.
Sector Update | China Property
Shanghai’s 15th Five-Year Plan calls for lower new residential supply and accelerated commercial facility upgrades, a template we expect other higher-tier cities to follow. Land-sale revenue across 300 cities fell 18.4% yoy in 8M26 and should weaken further from Sep 26 amid tighter pre-sale rules. New-home sales across 19 cities fell 3% yoy in August but rose 3% yoy in 1-6 September. Maintain UNDERWEIGHT; COLI remains our top pick.
Top Stories
Strategy | Taiwan Tech: Strong Growth Outlook; Supply And Ramp Execution Remain Key
We organised a Taiwan trip last week, which included meetings with TSMC and MediaTek. Both companies highlighted strong multi-year AI demand, but continued constraints in leading-edge capacity, substrates and advanced packaging limit near-term growth and margins. Looking ahead, TSMC expects N2 to become highly profitable and it could ultimately generate higher margins than 3nm, while MediaTek’s AI ASIC business is expected to become a key growth engine.
Sector Update | China Healthcare
Most healthcare companies beat 1H26 expectations, led by drug innovators and CRDMOs on strong sales and licensing revenue. Medical device firms face ongoing VBP and anti-corruption pressure in China, but globalisation will fuel growth through 2026 and beyond. Maintain MARKET WEIGHT; our top picks are Innovent, BeOne, Hansoh Pharma, WuXi AppTec, WuXi Bio and Edge Medical.
Sector Update | China Property
Shanghai’s 15th Five-Year Plan calls for lower new residential supply and accelerated commercial facility upgrades, a template we expect other higher-tier cities to follow. Land-sale revenue across 300 cities fell 18.4% yoy in 8M26 and should weaken further from Sep 26 amid tighter pre-sale rules. New-home sales across 19 cities fell 3% yoy in August but rose 3% yoy in 1-6 September. Maintain UNDERWEIGHT; COLI remains our top pick.
Analyst
Key Indices
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