“AI Isn’t the Only Star! Taiwan Stock Exchange Launches the ‘Taiwan Hidden Gems Index’ to Bring Undervalued Quality Companies Into the Spotlight”
▲ Taiwan Stock Exchange Chairman Sherman Lin. (Photo by Chen Chun-Sung, same below.)
Taiwan’s capital market is undergoing a historic structural transformation. Today (18th), the Taiwan Stock Exchange hosted the forum “AI Leadership × Hidden Gems Shining: Creating a New Era of Dual Momentum for Taiwan Stocks,” aiming to guide the Taiwan stock market from being driven solely by AI toward a “dual-engine” model jointly powered by AI leaders and promising hidden-gem companies, thereby offering investors a richer and more diversified range of investment opportunities.
During his opening remarks, Sherman Lin emphasized that Taiwan now stands at the core of the global semiconductor and technology industries, backed by deep technological expertise. Beyond AI and semiconductors, he noted, there is also a group of “core enterprises” that have long focused on their core businesses and maintained stable profitability, and these companies deserve greater recognition from investors.
“These hidden gems that have yet to be fully recognized by the market will become an important cornerstone supporting the steady long-term advancement of Taiwan stocks,” he said. To this end, the TIP Taiwan Index Plus Corporation launched the “Taiwan Hidden Gems Index” in January this year. Through a rigorous screening mechanism, the index selects hidden-gem companies that have quietly cultivated their core businesses while maintaining stable profitability and dividend payouts, with the goal of providing the market with diversified investment options that also offer downside resilience and defensive characteristics.
The forum opened with a keynote speech by Hsieh Chin-ho, president of Wealth Magazine, titled “Industrial Resonance: From Hidden-Gem Core Enterprises to AI Semiconductors.” Hsieh stated that beyond the strong stock price performance of AI-related shares, AI’s greater contribution to Taiwan lies in strengthening supply chain localization. Recently, some companies that have entered the semiconductor supply chain have become successful examples of transformation and upgrading within traditional industries. Against this backdrop, the Taiwan Stock Exchange’s launch of the Taiwan Hidden Gems Index selects high-quality companies with stable profitability, reliable dividend payouts, and sufficient liquidity, allowing more promising enterprises to gain market visibility.
“If Taiwan’s semiconductor industry achieves tenfold growth in the future, there will inevitably be even more SMEs that will have the opportunity to shine as well.”
▲ Hsieh Chin-ho, president of Wealth Magazine.
The discussion then continued with Hsieh Chin-ho, Tsung-Sheng Liu, chairman of Yuanta Financial Holdings, and Alex Lee, founder and CEO of Quantum International Corp, in a panel discussion titled “How Traditional Industries and AI Are Reshaping a New Landscape for Taiwan Stocks.” The session provided in-depth analysis of market capital flows and investment strategies.
Alex Lee observed that Taiwan’s stock market investor base is composed of foreign investors, institutional investors, and retail investors in a “40-30-30 golden ratio,” making it one of the fairest markets in the world in terms of liquidity for small-cap stocks, and that Taiwan should make full use of this advantage.
He further noted that beyond the semiconductor supply chain, there are in fact many other high-quality companies in Taiwan. “At present, both valuations and market participation in Taiwan’s stock market are highly active, making it difficult to find truly inexpensive investment targets. Nevertheless, we still need to position ourselves for the next five years. Hidden-gem companies and entrepreneurs are the new species most in need of cultivation, and Taiwan’s capital market should provide them with greater encouragement.”
▲ Alex Lee, founder and CEO of Quantum International Corp.
Tsung-Sheng Liu noted that the launch of the “Taiwan Hidden Gems Index” provides an excellent allocation tool that enables capital to flow toward high-performing companies with strong potential that have yet to be fully discovered by the market. As a result, future portfolio allocation for investors will no longer be a zero-sum dynamic between large-cap and small-cap stocks, but rather one of competition, cooperation, and even diversified integration between companies of different sizes.
“If we emphasize the concept of ‘small but beautiful,’ the development of the Hidden Gems Index is more comparable to the Russell 2000. The constituent companies may have smaller market capitalizations, but the index encompasses consumer sectors, AI, and startups. Through a single index, investors can gain a comprehensive panorama of Taiwan’s economy.”
The Taiwan Stock Exchange also announced that it will host a themed earnings presentation event for the “Taiwan Hidden Gems Index” from May 20 to 22 (detailed agenda provided below). Eight constituent companies from the Taiwan Hidden Gems Index will participate, presenting their current business conditions and future outlooks to investors. Registration for the event is now open, and investors may register online
In addition, COMPUTEX Taipei will take place in June, when major global AI industry leaders are expected to gather in Taipei. During the COMPUTEX exhibition period in June, the Taiwan Stock Exchange will also invite representatives from Taiwan’s AI industry to come together on the international stage to exchange insights and share their operational performance and technological advantages, showcasing to both domestic and international audiences the solid capabilities and diversified development of Taiwan’s industries.
Looking ahead, the Taiwan Stock Exchange stated that it will continue working closely with all market participants to provide investors with comprehensive and diversified investment options, while striving to build a more complete, resilient, and robust capital market.
News Source: https://www.wealth.com.tw/articles/8a66f289-a4ad-41d9-9829-45d59cff719f