Top Stock Market Highlights of the Week: NXP Semiconductors, Nvidia and iFAST Corporation – The Smart Investor
Welcome to this week’s edition of top stock market highlights.
NXP Semiconductors NV is partnering with Vanguard International Semiconductor Corp (“Vanguard”) to build a US$7.8 billion chip wafer plant in Singapore.
Vanguard is partially owned by Taiwan Semiconductor Manufacturing Co (NYSE: TSM), the world’s largest semiconductor manufacturer.
The announcement is a big win for Singapore as it aspires to attract more technology giants to set up shop here.
Both Vanguard and NXP will begin construction in the second half of this year with initial production slated for 2027.
Vanguard will invest US$2.4 billion for a 60% stake in the joint venture while NXP will inject US$1.6 billion for a 40% stake.
After this initial US$4 billion investment, each firm will then provide US$1.9 billion to support the plant’s long-term capacity.
This new facility will construct 300 mm wafers and by 2029, it should produce 55,000 such wafers per month.
The wafers will be used to produce mature technology-node chips used by vehicles, mobile devices, consumer electronic goods, and industrial products.
Such legacy chips are increasingly being produced in Singapore as players are attracted by low taxes and close geographical proximity to China, the world’s largest semiconductor market.
A spokesperson from NXP commented that this Singapore investment was one of the largest in the company’s history and will help to improve its geographical diversity.
The good news is that this joint venture, which will be operated by Vanguard, will help to boost Singapore’s economy by creating around 1,500 jobs.
Nvidia continues to impress with CEO Jensen Huang announcing plans to upgrade its artificial intelligence (AI) accelerators every year.
The stock has shot up by 154% year to date and surpassed the US$3 trillion market capitalisation mark, making the graphics processing unit (GPU) manufacturer the second most valuable company in the world behind Microsoft (NASDAQ: MSFT).
Huang announced a Blackwell Ultra chip for 2025 and a next-generation platform in development named Rubin in 2026.
The company also introduced new tools and software models on the eve of the Computex trade show held in Taiwan.
Huang believes that generative AI will herald a new industrial revolution and expects this new technology to play a major role in the shift towards personal computers.
Nvidia is also attempting to diversify its customer base beyond the crop of cloud computing giants to reduce reliance on these behemoths.
A larger swath of companies in various sectors such as shipbuilders and drug developers are well-positioned to embrace AI.
Huang’s vision of accelerated computing can help to deliver 98% cost savings and use 97% less energy if Nvidia’s technology is used.
Meanwhile, Nvidia is also releasing a new design for server computers built on its chips.
This programme, called MGX, allows companies such as Hewlett-Packard (NYSE: HPQ) and Dell Technologies (NYSE: DELL) to market faster with products used by corporations and government agencies.
Nvidia also provides a service called Nvidia Inference Microservices, or NIM, which supplies “AI in a box” – companies that deploy these services will have to pay Nvidia a usage fee.
Huang also announced the Omniverse and promoted the use of digital twins to conduct more sophisticated weather pattern modelling and other complex tasks for Earth.
iFAST has launched its inaugural bond issue from its recently established S$300 million multicurrency debt issuance programme.
The size of the launch is S$100 million for 5-year notes that pay a coupon rate of 4.328%.
These notes are due in 2029 and will be issued on 11 June.
The proceeds from this issue may be used to refinance existing borrowings, be spent on capital expenditure, be used for capital injections into the group’s digital bank iFAST Global Bank, or as general working capital.
CEO Lim Chung Chun said that these notes will help iFAST diversify its funding sources and that the maiden issuance saw an encouraging response.
Both institutional and accredited investors warmed up to the issue, helping it to achieve an over-subscription rate of 2.5 times.
A unique feature of this bond is that investors were able to purchase it in denominations of S$10,000 with incremental amounts of S$5,000.
As far as iFAST is aware, this is the smallest minimum issue denomination for a Singapore-dollar-denominated bond issue.
Such a low threshold will open up more opportunities for investors to diversify their bond holdings as it will allow them to purchase a wider range of bonds to include in their portfolios.
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Disclosure: Royston Yang owns shares of iFAST Corporation.
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