TSMC(US:TSM) Zhi Tong Cai Jing·2025-08-01 03:24Core Viewpoint - The price gap between TSMC's American Depositary Receipts (ADR) and its shares listed in Taipei has surged to the highest level in over 16 years, raising concerns about a potential overheating in the AI market [1][2] Group 1: Price Discrepancy - TSMC's ADR in July had a premium of 24% compared to its local shares, up from 17% in April and significantly higher than the 10-year average of 7.4% [1] - The current price difference is the largest since April 2009, indicating a significant divergence in market perception between the U.S. and Taiwan [1] Group 2: Market Dynamics - The increase in ADR premium is attributed to heightened investor interest in TSMC's role in the global AI supply chain, leading to increased demand for its ADRs in the U.S. market [1] - The supply of ADRs is relatively fixed, with limited room for new issuances and more challenging conversion processes, which has contributed to the widening premium [1] Group 3: Investment Trends - Since the release of ChatGPT in 2022, TSMC's ADR has risen over 190%, while its Taipei-listed shares have increased by less than 140% [2] - Foreign ownership of TSMC's local shares has risen to nearly 74%, still below the historical high of 80% recorded in 2017 [2] Group 4: Cautionary Signals - Market observers, including Owen Lamont from Acadian Asset Management, suggest that the expanding price gap may signal caution, as excessive premiums for popular tech companies' ADRs relative to local stocks often indicate market bubbles [2]