Asia Vital Components price target raised to NT$1,200 by JPMorgan

JPMorgan has raised its price target for Asia Vital Components Co Ltd (TPE:3017) to NT$1,200.00 from NT$1,145.00, maintaining an Overweight rating, driven by the expanding liquid cooling total addressable market and increased cold plate content in GPU and ASIC systems. While the firm notes potential negative impacts from Micro-Channel Lid (MCL) adoption in Rubin GPUs by H2 2026, it anticipates new large-sized cold plate modules in Rubin CPX GPUs will mitigate this, positioning AVC as a primary beneficiary through 2026-2027 due to accelerating ASIC liquid cooling and new Rubin CPX GPU cold plate demand.

Analysis

JPMorgan has upgraded its price target on Asia Vital Components Co Ltd (TPE:3017) to NT$1,200.00 from NT$1,145.00, reiterating an Overweight rating. The revision is predicated on an expanding total addressable market (TAM) for liquid cooling, driven by increased cold plate content in advanced GPU and ASIC systems essential for AI infrastructure. The firm identifies AVC as a primary beneficiary of this trend through 2026 and 2027, citing accelerating demand from the ASIC liquid cooling market and new orders for Rubin CPX GPU cold plates. However, the analysis also flags a specific long-term risk: the anticipated adoption of new Micro-Channel Lid (MCL) technology in Rubin GPUs in the second half of 2026, which could negatively impact AVC's cold plate business. This risk is potentially mitigated by the deployment of new large-sized cold plate modules on additional Rubin CPX GPUs, which JPMorgan suggests could not only offset the MCL impact but possibly increase the total cold plate content within the Vera Rubin compute tray.

Key Decisions for Investors

• Investors with a bullish thesis on AI data center infrastructure may view the increased price target and Overweight rating as a positive signal, given AVC's strategic position as a leading supplier in the growing liquid cooling market.
• It is crucial to monitor a key technological risk: the adoption of Micro-Channel Lid (MCL) technology, which is projected for H2 2026 and could create a future headwind for AVC's cold plate demand.
• Consider the investment horizon carefully, as the positive outlook is supported by near-term growth drivers through 2026, while a significant technology transition risk is expected to emerge in the latter half of that year.
• Watch for company and industry updates regarding the adoption of large-sized cold plates for Rubin CPX GPUs, as this is the primary factor JPMorgan identifies to mitigate the potential negative impact from MCL technology.