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TSMC posts strong Q1 profit, more gains ahead

TAIPEI, April 27 (Reuters) - TSMC 2330.TW, the world's biggest contract chip maker, posted a sharp rise in quarterly profit that beat market expectations, as the company sold more chips for new computers and high-tech gadgets.

Taiwan Semiconductor Manufacturing Co Ltd (TSMC) TSM.N booked a net profit of T$33.66 billion ($1.1 billion) in January-March, compared with T$1.56 billion a year ago, the company said in a statement on Tuesday.

It was the biggest quarterly profit since the fourth quarter of 2007.

TSMC was expected to earn T$30.76 billion in the first quarter, according to a consensus forecast by Thomson Reuters I/B/E/S.

Analysts expect TSMC and No. 2 chip foundry UMC 2303.TWUMC.N to reap bigger profits this year as they ride a boom in new computers, mobile phones and flat-screen TVs that require more powerful microchips.

TSMC's Taipei-listed shares have risen about 11 percent since the year's low in early February on its bright earnings outlook, helping Taiwan's main TAIEX .TWII up 13 percent in the same period. UMC shares were flat in the same period. (US$1=T$31.3) (Reporting by Baker Li; Editing by Jean Yoon)