Hot Stock: Holy Stone Hits Two-Day Limit-Up, Reclaims NT$1,000 and Sets New Record High

MLCC manufacturer Holy Stone (3026-TW) reported strong June revenue, following yesterday's trading limit-up that propelled it past Yageo (2327-TW) to become the market leader in the passive components sector. Today (9th), the momentum continued, with shares hitting the daily limit-up at NT$1,045 during trading, reclaiming the NT$1,000 mark and setting a new record high.

Holy Stone's June revenue reached NT$1.378 billion, up 6.75% month-on-month and 33.9% year-on-year. Second-quarter revenue totaled NT$4.097 billion, up 13.2% quarter-on-quarter and 25.2% year-on-year. First-half 2023 revenue amounted to NT$7.715 billion, a 15.6% increase from the same period last year.

Holy Stone Chairman Tang Jin-Rong stated that AI continues to drive strong, rigid demand for MLCCs, describing market conditions as the strongest ever seen this year and forecasting even tighter supply next year. With total production capacity constrained and unable to scale up rapidly in the short term, the company plans to reduce the proportion of mid-to-low-end products and focus on high-end products, which will also help improve gross profit margins.

In response to rising demand, Holy Stone is expanding production capacity. Chairman Tang indicated that new equipment will be delivered sequentially from Q3 2023 to Q1 2024. Production capacity is expected to increase by 20-30% this year and 30-40% next year. Currently, delivery lead times for high-end equipment have extended to 12 to 18 months.