Stock market today: S&P 500 extends monthly win streak despite Nvidia-led stumble
Investing.com -- Morgan Stanley analysts say NVIDIA’s plan to resume shipments of its H20 GPUs to China could create clear winners and losers across the semiconductor supply chain, depending on capacity, inventory levels, and pricing dynamics.
According to Morgan Stanley (NYSE:MS), “around 1mn units of H20 chip inventory [are] being prepared by the Taiwan semi supply chain,” though there are no new wafer starts of H20 at TSMC yet.
The firm believes the move is “positive for some stocks including TSMC (wafers; OW) and KYEC (chip testing; OW),” while calling it “negative for China domestic GPU foundry, SMIC (EW).”
Morgan Stanley’s checks suggest roughly 700,000 chips are finished, with “another 200k-300k chips” potentially tested by KYEC, bringing [the] estimated inventory to 1 million units. TSMC ADR shares rose 3.62% following the news, outpacing the Nasdaq’s 0.18% gain.
CoWoS-S packaging will likely be a bottleneck. Morgan Stanley said it sees “limited upside for CoWoS-S capacity expansion,” maintaining an Equal Weight rating on packaging equipment maker AllRing.
Longer term, new orders remain uncertain. “It remains to be seen whether there will be new H20 orders after the 1mn units chip are sold,” analysts wrote. No fresh wafer starts at TSMC have been observed.
Meanwhile, NVIDIA’s upcoming RTX Pro 6000D (B40), a potential China-specific alternative to the H20, could sell for 30% less, according to the bank.
“The performance gap with H20 (tokens per second, memory bandwidth) will be critical,” Morgan Stanley noted.
Cloud service providers in China will likely evaluate options based on price-performance tradeoffs.
“The final performance of the RTX Pro 6000D remains to be seen,” the analysts said, with demand potentially hinging on cost and compute power.