2026 Taiwan Stock Market Gold Rush Guide: Grasp the "Shortage" Pulse, How ABF Concept Stocks and AI Supply Chain Are Set to Take Off?

The key word in Taiwan’s tech market in 2025 is not “rise,” but “shortage.” From chip foundries to heat dissipation materials, from advanced packaging to power systems, the entire supply chain is playing out a battle for capacity. Huang Renxun frequently visits Taiwan to expedite orders, positioning Taiwan as NVIDIA’s global R&D hub. This signal is enough to explain everything—Taiwanese manufacturers are stuck in the most profitable position of the AI wave. As the new generation ETF is rapidly listed and the list of billion-dollar stocks continues to expand, how will the investment landscape evolve in 2026?

Shortage = Opportunity: Spreading from IC Design to the Entire Supply Chain

Ultimately, this year’s story in Taiwan stocks is summed up in one word: “shortage.” By the end of last year, the number of billion-dollar stocks surged to 28, setting a record. The key change is that the increase is no longer limited to IC design companies but has spread to heat dissipation, PCB, materials, power, testing interfaces, and other comprehensive segments. This is a real-world demonstration of the spillover effect of AI demand.

Xinhao, as this year’s stock king, benefited from BMC chips becoming standard in AI data centers, with stock prices more than doubling and once surpassing NT$7,300. But what truly stands out is the heat dissipation group, with Qihong and Jiance simultaneously rising to billion-dollar stocks, with annual gains approaching or exceeding 100%. On the material side, Taiwan Optical Electronic (Tai Guang Dian), due to the shortage of high-speed copper foil substrates(CCL) and fiberglass cloth, saw its stock price surge by 159%, becoming a dark horse of the year.

Chuanhu, Yingwei, Wangxi, and other groups all gained over 140%, once again confirming the market logic that “shortage equals value.” Even the long-term stable Delta Electronics also broke into the billion-dollar club due to the surge in power demand from AI data centers, rapidly climbing in the market cap rankings.

Material Upgrades Trigger a Rare Decade-Long Supply Chain Gap

Upgrades in AI server specifications have directly triggered a shortage of upstream materials. High-end fiberglass cloth and low-loss copper foil substrates are in severe short supply, with prices continuously rising. Foreign analysts point out that NVIDIA’s next-generation platform will adopt higher-grade copper foil substrates and copper foil materials, making material upgrades an irreversible trend.

This wave of material shortages has significantly improved the gross margins of related Taiwanese manufacturers. Besides Taiwan Optical Electronic, Lianmao and Taiyao have benefited from rising material prices. Downstream PCB and substrate manufacturers Zhen Ding and Xinxing maintain full capacity operation. ABF concept stocks and ABF substrate demand are strong, and these companies have already laid the groundwork for operational growth in 2026. As the core material for high-end servers, the supply tightness of ABF substrates even exceeds some chips, making the profit elasticity of related upstream and downstream companies worth close attention.

New ETF Listing Sparks Immediate Attention, Institutional Deployment Clearly Visible

Retail investors chase individual stocks, while institutions adopt a more systematic approach. Fuhua Future 50(00991A) recently listed, raising over NT$10 billion. Although it slightly broke the debut price on the first day, its trading volume exceeded 230,000 units, making it the top ETF in trading volume, demonstrating market enthusiasm.

Looking at its top ten constituent stocks, it is almost a map of AI investment: TSMC, Hongjin, Qihong, Weiying, Taiwan Optical Electronic, Delta Electronics—none are missing. The stock selection logic of this active ETF is clear—semiconductors account for 35-45%, AI data center components 35-45%, AI servers and networking 5-15%, plus some financial and traditional industry allocations as risk buffers.

Manager Lü Hongyu straightforwardly states that AI remains Taiwan stocks’ strongest growth engine. Profit growth for Taiwanese companies is expected to reach about 20% in 2026. Coupled with a moderate interest rate environment, the bullish trend has a high probability of continuing.

Next Wave Winners: VR Platform Upgrade Wave, Silicon Photonics, and Liquid Cooling Penetration

The focus of Taiwan stocks in 2026 will be on NVIDIA Vera Rubin(VR) platform launch, which will trigger a new server upgrade wave. The new platform features comprehensive upgrades in heat dissipation, power consumption, and interconnect bandwidth. ODMs like Quanta, Weiying, and Foxconn have become core partners, and related power, heat dissipation, and PCB supply chains will benefit again.

On the technical front, silicon photonics and CPO( co-packaged optics) are key to solving high-speed transmission bottlenecks. Taiwan has formed a complete strategic ecosystem from epitaxy, optical components to packaging, with companies like Lianya and Wunmao showing considerable growth potential. Another trend worth noting is liquid cooling— as GPU power consumption surpasses one kilowatt, the penetration rate of liquid cooling will rapidly rise from less than 10% now to over 60% in the coming years. Companies like Qihong, Shuanghong, and Jiance have already taken the lead in positioning.

Investment Strategy: Focus on “Shortage Segments,” Valuation Not to Be Overlooked

After a significant rise, Taiwan stocks are prone to fluctuations and valuation concerns. However, from an industry fundamentals perspective, the shortage of AI-related capacity is unlikely to ease before 2026, especially in advanced packaging, high-end materials, heat dissipation, and power systems. In other words, shortages are the most stable source of profits. Grasping the key players in the supply chain is equivalent to unlocking the next wave of growth.