[China Merchants Securities: Huawei's 'Tao Law' Expected to Drive Industry Chain Technology Upgrades, Recommend Paying Attention to Fields like Foundry Services] According to a report by Jinse Finance on May 26, China Merchants Securities stated that Huawei has introduced the 'Tao (τ) Law,' an innovative guiding principle in the semiconductor field. This law is expected to reshape the paradigm of semiconductor iterative technology and drive technology upgrades across the upstream and downstream industry chains. It is recommended to focus on areas such as foundry services, advanced packaging and testing, and equipment. The analyst team led by Yan Fan pointed out in the report that the core logic of the 'Tao (τ) Law' lies in folding and 3D stacking technologies, which are based on multi-layer chip vertical stacking and hybrid bonding. This, in turn, demands stricter requirements for copper plating technology, surface smoothness, cleanliness, and bonding alignment precision. These requirements will systematically elevate the demand for related copper plating equipment, chemical mechanical polishing (CMP) equipment, hybrid bonding equipment, cleanrooms, and associated consumables. Currently, domestic companies like SMIC and Hua Hong Semiconductor are experiencing capacity shortages, with a supply-demand gap in advanced processes. The long-term healthy growth of domestic demand is expected to accelerate capacity expansion. Huawei's commercial validation of logic folding and 3D stacking is creating a strong incremental boost for advanced packaging. The multi-layer vertical heterogeneous architecture imposes higher precision requirements on equipment, and it is recommended to focus on the new demand for advanced packaging and testing equipment, including TSV etching equipment, CMP equipment, and others.