Immersion DUV productivity
330Premium research · ASML · 5 August 2026
China built a machine.
It has not yet built a competitor.
China threatens ASML's local revenue. Valuation remains the more immediate investor risk.
MITUXA VERDICT
HOLD / WATCHHigh business conviction · Medium-high riskReference price€1,462.60
Base value€1,560
Disciplined entry< €1,250
Horizon3–5 years
BEYOND THE OBVIOUS
The moat is a system,
not a patent.
China may have built a machine. It has not yet proved that it has built an economically viable competitor.
A lithography tool is not competitive merely because it can expose a wafer. It must deliver resolution, overlay accuracy, throughput, uptime and yield repeatedly across thousands of production cycles — supported by software, service, spare parts and process knowledge.
Outside China, there is no public evidence that ASML's global moat has been broken. Inside China, however, supply security changes the equation: a less productive domestic tool can still be economically rational if the alternative is losing access to foreign equipment and support.
THE INVESTMENT CASE
Three facts define the debate
China exposure
29.1%of 2025 group sales
Domestic substitution and export controls make Chinese DUV revenue a material risk, even without a global challenger.Innovation scale
€4.7B2025 R&D investment
ASML's moat compounds through engineering scale, its supplier ecosystem, installed base and accumulated fab knowledge.VALUATION
Exceptional quality.
Limited margin of safety.
Our bear, base and bull cases produce values of €1,050, €1,560 and €2,100 per share. The probability-weighted value is approximately €1,540 — only about 5% above the reference price before dividends.
WHAT COULD BREAK THE THESIS
- A Chinese system proves competitive throughput, overlay, uptime and yield in high-volume manufacturing.
- ASML loses meaningful immersion DUV share outside China.
- Multiple leading customers delay EUV orders or AI capital expenditure weakens materially.
- Further export controls remove both sales and service revenue without capacity being absorbed elsewhere.
COMPLETE RESEARCH
Read the full
MITUXA report.
The complete 15-page report covers ASML's economic system, China's immersion DUV effort, the distinction between domestic substitution and global competition, financial quality, AI capital-expenditure risk, valuation scenarios and thesis invalidation conditions.
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