ASML Draws a $129M Vote of Confidence as Brussels Writes New Chip Rules and India Signs On

Australian pension fund invests $129M in ASML, betting on its EUV monopoly amid EU regulatory push. India expansion and sold-out capacity reinforce long-term appeal.

The Australian pension fund Construction & Building Unions Superannuation Fund has placed a $129 million bet on ASML, buying into the Dutch lithography giant on May 29. The move comes at a moment when Brussels is pushing for greater control over Europe’s most critical semiconductor supply chain, and just days after the chip-equipment maker announced a strategic partnership to build India’s first commercial 300-millimeter wafer fab. Institutional investors appear willing to look past near-term political noise in favor of ASML’s technological stranglehold on advanced chip production.

The European Commission has been drafting what is being called the European Chips Act 2.0, a legislative package that would grant it emergency powers to monitor and intervene in critical semiconductor supply chains during crises. Reports from May 28 detail that the commission wants direct oversight of companies such as ASML, which controls roughly 90% of the lithography market and holds an effective monopoly on extreme ultraviolet (EUV) systems. Those machines are indispensable for producing the high-performance chips that power artificial intelligence, data centers, and advanced electronics. While the bill has not yet been adopted, the direction of travel is unmistakable: more state influence over a company that already operates in a politically sensitive zone between Europe, the US, China, and Asia’s leading chipmakers.

The stock has held up well despite the regulatory overhang. In Amsterdam, ASML shares trade near €1,407, just shy of their 52-week high of €1,420.80. The US-listed equivalent closed at $1,605.77, up 0.49% on the day. Year to date, the stock has gained more than 42%. The pension fund’s purchase — executed at a time when many retail investors might hesitate — underscores the conviction among long-term allocators that ASML’s competitive moat dwarfs near-term political friction.

Operationally, the company continues to deliver. First-quarter 2026 revenue came in at €8.77 billion, beating expectations. Management has guided for full-year sales of €36 billion to €40 billion, with gross margins of 51% to 53%. For the current second quarter, the company expects net revenues between €8.4 billion and €9.0 billion, while the analyst consensus sits at €8.89 billion. Demand for EUV systems remains robust, and capacity for 2026 is effectively sold out. The company plans to ship around 60 low-NA EUV tools this year and is rolling out its next-generation high-NA EUV technology alongside.

Meanwhile, ASML is broadening its geographic footprint. A new partnership with Tata Electronics will see the company supply advanced lithography equipment — including EUV systems — for India’s first commercial 300-millimeter frontend semiconductor fab in Dholera, Gujarat. The agreement also covers training, supply chain support, and joint research. For India, the deal represents a meaningful step into the global chip manufacturing ecosystem. For ASML, it provides a growth channel that reduces reliance on the established hubs of Taiwan and South Korea, and aligns with the global push for regionalized chip production.

The valuation story is more nuanced. ASML’s trailing price-to-earnings ratio stands at 51.63, well above the five-year median of 39.07. The GF Value model pegs fair value at $1,101.63, implying the stock is overvalued by about 46%. The market capitalization has swelled to roughly $621.7 billion. A PEG ratio of 1.34 also sits slightly above the semiconductor sector average of 1.29, suggesting that the current price already discounts considerable future growth. Every miss — whether on earnings or on new export restrictions — could hit a stock that leaves little room for disappointment.

To support its elevated valuation, ASML continues to return capital to shareholders. A €12 billion share buyback program is running through 2028. Analysts project 2026 revenue of around €39 billion and earnings per share of about €31.40. The broader AI boom provides a structural tailwind: in late May, memory makers SK Hynix and Micron each crossed the $1 trillion market-cap threshold, while Nvidia has touched $5 trillion. Those companies are among ASML’s most important customers, and their insatiable demand for HBM memory and AI accelerators directly drives orders for ASML’s lithography systems.

The next major catalyst will be the second-quarter earnings release. If management confirms that EUV capacity remains fully allocated through 2026, the buy narrative retains its force. Any softening in the tone — particularly around export controls or the pace of high-NA adoption — would carry disproportionate weight given the premium already baked into the stock. The legislative process surrounding the Chips Act 2.0 will continue to shadow the shares in the months ahead, but for now, the world’s largest pension funds are voting with their dollars.