1. Wei Shaojun: The development of AI chips is too hot. Most startup companies will become martyrs;
On the 9th of March, micro-electronics department director of the Department of Microelectronics and Tsinghua University, Wei Shaojun, director of Microelectronics, said in an activity speech that AI chips are now too hot and killer applications have not yet emerged. Most of the current AI chips Entrepreneurs will become 'martial'.
2. Zhao Jinrong, president of North China Development Co., Ltd.: China-made equipment has entered the high-production line of integrated circuit mainstream factory;
In the field of integrated circuit chip manufacturing, North China Chuang Microelectronics has seven types of products: etching machine, PVD, monolithic annealing equipment, oxidation furnace, annealing (alloy) furnace, LPCVD and cleaning machine.
After unremitting efforts in 2017, these products have been steadily mass produced in several of China's most mainstream integrated circuit chip factories.
The plasma silicon etching machine applied to the 14nm advanced process independently developed by the North Huachuang, Hardmask PVD, Al-Pad PVD, ALD, monolithic annealing system, LPCVD has officially entered the integrated circuit mainstream foundry.
Hardmask PVD, Al Pad PVD equipment has successfully entered the international supply chain system; the 12-inch 65/55nm cleaning machine has exceeded one million mark in the cumulative stand-alone flow-through chip; deep-silicon etching equipment has also successfully entered the Southeast Asian market.
In addition, it is applied to the 28nm Hardmask PVD system process equipment, applied to the 28/40nm monolithic annealing equipment, applied to the 55nm silicon etching machine, and has been designated as the Baseline platform by the domestic leading integrated circuit chip manufacturing company.
In the field of advanced packaging, the plasma etching machines, PVD and Descum of North China Microelectronics have been fully applied, such as WLCSP, TSV, Copper pillar bump, and Gold bump.
In the application of CIS WLCSP, the PVD of North Huachuang Microelectronics is the world's first 12-inch production line base machine. With stable and excellent performance, it continuously obtains repetitive orders and helps customers continue to obtain high-end field orders.
In the new market in recent years, the North China TSV etching machine has an absolute advantage in mainland China, maintaining a relatively large market share.
In terms of Copper Pillar Bump, PVD equipment has entered the production lines of the two largest sealing and testing plants in mainland China, and Descum equipment has also received duplicate orders from the top two sealing and testing plants; Gold Bump regards North China's PVD equipment as the main gold bump in the mainland. Packaging and testing plants have achieved sales.
With the advancement of advanced packaging technology to high density and high integration, the market will use more through-hole technology and rewiring technology, which means more plasma etching and PVD equipment demand. The core advantages of electronic products are highly consistent. North China Microelectronics will continue to provide newer technologies in this area, as well as more high-quality products and services.
In the past two years, due to the widespread application of Internet of Things, automotive electronics, and smart home appliances, the 8-inch wafer fab in the integrated circuit industry has suffered a severe shortage of production capacity, and the global 8-inch equipment is in tight supply.
North Huachuang has been accumulating on 8-inch devices for many years. At the beginning, North Huachuang Microelectronics started with a 100-nanometer lithography machine in the integrated circuit field, successfully achieved a major breakthrough in technology and the market, and won the second prize of 2009 National Scientific and Technological Progress Award. .
Today's market opportunities have followed the trend. The company is also constantly innovating and expanding. At present, we have a variety of 8-inch mature products and equipment, including silicon etching machine, silicon oxide etching machine, metal etching machine, PECVD, oxidation furnace , LPCVD, Monolithic Cleaning Machines, Automatic Trough Washers and many other core process equipment.
As a domestic equipment manufacturer, we understand the needs of the domestic market and customers better, provide more timely and high-quality services, and can further develop in-depth cooperation with customers based on our unique processes. We have great advantages in the 8 inch emerging applications and featured processes. Newsletter
3. Hangzhou Silicon's revenue is expected to increase by 20% to 30% this year;
According to the micro-network news, Hangzhou Silicon Lijie entered the peak season of industrial products shipments in the first quarter, and SSDs, smart meters, and IP CAM shipments were booming. Among them, SSD control ICs benefited from the top-rated Samsung market share of major customers. The continued heavy volume of goods will drive 2018 revenue growth from 20% to 30%.
In the year before last, Hangzhou Sileoger successively acquired the Meixin smart meter and the NXP LED lighting department. After one year of adjustment, the operation gradually took off. Last year, the revenue triple jump came to NT$ 8.608 billion, an increase of 20.58% year-on-year. Looking forward this year, In the first quarter of the year, the company entered the peak season for the shipment of industrial products. Driven by the awareness of global energy conservation and environmental protection, Hangzhou Silex smart meter control ICs shipped heavy volume, and market share in North America, Europe and South America gradually increased.
In the LED lighting segment, after Silicon Power acquired NXP, it extended its tentacles from indoor LED lighting to high-priced outdoor LED lighting drivers. In particular, NXP owns its special outdoor lighting patents, which complements Hangzhou Silicon Lijie's technology in indoor LED lighting, Hangzhou Silicon. Li Jie received both NXP, Europe and the United States market customers, and expanded the source of emerging market customers, the first quarter shipments increased.
In addition, solid state hard disk drive ICs in the industry's solid state drives and IP CAM segments have steadily grown in the first half of the year as Samsung, a major customer, has steadily grown, while penetration rate of TV products has increased in China and South Korea, and AC/DC market share has increased. Continue to expand.
4. Deep cultivating special techniques SMIC still insists on 'walking on two legs';
On March 1, 2018, the SMIC Semiconductor Manufacturing (Shaoxing) Co., Ltd. project jointly funded by SMIC, Shaoxing City Government and Shengyang Group formally signed a contract. The total investment of the project is 5.88 billion yuan, targeting MEMS and power devices and other fields. Wafer and module foundry, after the completion of the construction will form a comprehensive specialty manufacturing base.
For SMIC, most of the industry’s current concerns are focused on the development and mass production of 28-14 nm advanced processes. However, in fact, mature features have always played an important role in the development of SMIC, not only in the company’s With half of the revenues and profits being captured and satisfying a large number of customer needs, SMIC has long been adhering to the development strategy of 'advanced process and mature process walking on two legs'. With the current transition into the transition period of SMIC, we will strengthen our specialty process. More special significance.
Advanced process mass production reveals light
Taiwan Semiconductor Manufacturing Co., Ltd., Samsung's global foundry giants are rapidly evolving towards 10nm and 7nm processes, igniting the industry’s enthusiasm for the advancement of Moore’s Law, and focusing on SMIC’s observations at 28-14nm. Above the development of advanced processes, the industry recognizes that 28nm is a long-life node. According to IBS' forecast, with the gradual maturation of the 28nm process, the market demand presents a trend of rapid growth, with 913,000 films starting from 2012, and 2014. The 2.945 million pieces have been increasing to 4.633 million pieces in 2017. It is predicted that even by 2020, the market demand will still reach 4.287 million pieces/year.
After continuous exploration in the past two years, SMIC made great progress at 28nm. A few days ago, SMIC released the fourth quarter 2017 financial report, which shows that the proportion of 28nm revenue has increased dramatically from the third quarter. 8.8% increased to 11.3% in the fourth quarter, and the total sales in 2017 accounted for 7.9% of the total sales volume. This production scale shows that SMIC's grasp of the 28nm PloySiON process has been relatively stable. Sharply increase production.
SMIC CEO Liang Mengsong said in the fourth quarter 2017 earnings conference call that it will mass-produce 28nm HKMG and HKMG+ in mid-2018 and mass production in the second half of the year. Once this plan is successful, the 28nm process technology node will be completely opened. The special status of the 28nm process means that SMIC has taken a big step forward in the development of advanced processes. In addition, SMIC is actively advancing 14nm. Recently, SMIC increased its capital. In SMIC South, the shareholding ratio was changed to 50.1%. The National IC Industrial Investment Fund and Shanghai IC Fund respectively owned 27.04% and 22.86% of SMIC, becoming the second and third largest shareholder. SMIC’s development in the south The focus is 14nm. It is expected that SMIC's 14nm will be put into operation in the first half of 2019.
SMIC enters transitional transition period
Looking back at 2017, SMIC’s sales amounted to approximately US$3.101 billion, gross profit US$741 million, and annual gross profit margin was approximately 23.9%. Although overall growth was equal to the industry average, gross profit margin was comparable to 2016. The decline fell from 30.2% in 2016 to 23.9% in 2017. The breakthrough in advanced process mass production was a bright spot in the fourth quarter of 2017, but the gross profit margin cast a shadow on the company's performance. The company said that although the proportion of 28-nanometer revenue was higher than the expected 10%, due to intense product competition, ASP of 28-nanometer products has declined, which also has a certain impact on gross margin in the fourth quarter of 2017.
In fact, over the past few years, SMIC has promoted double-growth of revenue and earnings by virtue of its high capacity utilization rate. However, the development of all companies is in the cycle of accumulation and growth. According to SMIC's joint CEO Zhao Haijun Viewpoint: SMIC is currently undergoing a transitional period of transition and needs to be prepared to quickly meet customers' technology transitions in order to face the ever-changing industrial environment.
As the company enters a transitional period and needs to prepare the technology and factories for the next stage of growth, R&D expenditures and capacity expansion costs for advanced processes, as well as depreciation expenses, will increase substantially. Feedback on financial performance will be a decline in gross profit margin. Under this circumstance, it is more important to strengthen the mature features. It will function as a stabilizer and ensure that SMIC can achieve relatively stable revenue and profit. With the arrival of an intelligent society, the Internet of things, The market for automotive, industrial control and other application fields is booming. The MEMS based on feature processing is one of the cores of intelligentization. The development of mature and characteristic processes is indispensable. Zhou Zixue, Chairman of SMIC also stated that SMIC is in the micro-electromechanical With nearly 10 years of hard work in the field of feature processing in power devices, we are confident to create a leading domestic, world-class specialty semiconductor company.
The characteristics of mature features highlighted
In 2018, SMIC had many challenges. Xiamen Lianxin’s 28nm production has been in volume production in 2017. This year, TSMC’s Nanjing plant’s 16nm is scheduled to reach volume production in May. In addition, the Grooved Chengdu Plant is expected to introduce 22nm in 2019. FD SOI process, etc. The international OEMs are fiercely competing for Chinese customers in advanced technology.
It is precisely because of this that it is very important for SMIC to walk on both legs of advanced technology and mature technology. On the one hand, it catches up with the progress of international advanced mainstream technology; on the other hand, it vigorously taps mature technology to play a differentiated advantage and provides value-added for customers. Services, for the company to obtain relatively stable income.
In this regard, semiconductor expert Mo Daikang pointed out that 28-nanometer HKMG and 16/14-nanometer FinFET process are all 'stumbling blocks' in advanced manufacturing processes, but they must be moved as quickly as possible. Adhere to 'advanced and mature processes to walk on two legs. 'The development strategy will make the road go more robust.
From the market perspective, with the rise of the Internet of Things, the importance of featured processes is becoming increasingly prominent. The IoT market is a killer application in the semiconductor industry, and does not require reliance on advanced process processes. Its product design and process models will be developed under mature process technology. It is perfectly matched with Chinese domestic companies. Therefore, SMIC's strategy to respond to the market is to focus on advanced process development, while cultivating specialties on featured crafts, sticking to walking on two legs to ensure competitive advantage in the industry.
According to the statistics, over the years, SMIC has made many breakthroughs in its characteristic processes, including CIS-BSI (back-illuminated CMOS image sensor), 55nm eFlash (embedded flash memory), 38nm independent NAND flash memory, and TDDIC (display driver IC) Developed MTE (Mature Technology Optimization) 95nm, and MEMS-IMU (Inertial Measurement Device) Process Technology etc. China Electronics News
5. Mass production of the Nanjing Sealing Plant Yanjing Nanjing Plant in the second quarter
According to the micro-message message, Zhang Jiming, general manager of IC Wafer Testing Plant in Taiwan, said yesterday that the next three years are important operating hours. This year's growth is good, and there are plans to merge in the future. Xinyi Nanjing Plant is expected to operate in the second quarter. Mass production.
Looking ahead to the trend of operations this year through 2020, Zhang Jiming said that Xin Yan actively ploughs into the fields of automotive electronics, internet of things, and high-performance computing. The next three years are important operating hours.
He pointed out that Xin Yan continued to expand the general microcontroller (MCU), automotive electronics, safety control, etc., and the Internet of things RF components have also made breakthroughs, established a power chip test line, and laid out other new applications. It should be in the next five years. Early stage of growth.
Looking ahead to this year's industry overview, Zhang Jiming pointed out that this year is currently cautiously optimistic and the trend is healthy. From the point of view of delivery of test machines to six months, it is expected that growth will continue to be good this year. This year the semiconductor industry still sees continued growth.
From the perspective of semiconductor applications, Zhang Jiming said that mobile phone chip makers continue to adjust inventory this year, and the growth of mobile phone applications is limited, but automotive electronics, the Internet of Things and high-performance computing continue to grow steadily.
Observing the scale of capital expenditures this year, Xin Chun, Director of the Financial Management Office, said that this year's scale will not grow much as compared to last year, and it is currently planning a scale of NT$2 billion.
In the future M&A plan, Zhang Jiming stated that Xin Yan will not exclude M&A plans in the future and will carefully select the target.
Looking ahead to the layout of the Nanjing plant, Gu Shangwei pointed out that the Nanjing plant was moved into the testing machine in December last year. In the first quarter of this year, the company obtained quality management system certification and major customer verification, and began testing operations. It is expected to start mass production in the second quarter, with quality and reputation as the Lord.
Investing in Taiwan, Zhang Jiming stated that Xinhan continued to invest in finished product testing in four plant sites in Taiwan. Overall, Xinyi has deployed Nanjing Plant to invest in Wafer Level Packaging (WLP) companies, and combined with Quanzhi Branch to expand the impact of the industry chain. force.
From the perspective of application, Xin Yan last year, the proportion of automotive and security control applications about 20.2%, the amount of 36% growth. From the perspective of test products, Yan Yan in the wafer test accounted for 88%, finished product testing accounted for 12%.
Zhang Jiming said that Xin Yan will make new progress in strategic product testing this year. The proportion of finished product testing in the future will be 15%, and long-term planning will be 20%.
Gathering micro-network news, April 26, 2017, TSMC's supporting project, Xinhan (Nanjing) IC Co., Ltd. Semiconductor test project started in Pukou Development Zone, covers an area of about 80 acres, with a total investment of 135 million US dollars.
Xinhan Technology Co., Ltd. was established in 1999. It is a professional semiconductor tester in Taiwan. It is mainly engaged in the test engineering development and test production of memory, logic and mixed-signal integrated circuits.
In recent years, Xinyi has made globalization arrangements, including setting up operating locations in Singapore and South Korea, and fought for orders for OEMs in the later stages of the local wafer foundry. After TSMC decided to set up a 12-inch fab in Nanjing, China, Xin Yan Also decided to follow up and set up a factory in Nanjing, set up a new 12-inch wafer test production line, in the future will undertake the TSMC wafer test OEM orders.
6. SMIC: Jedi fight back at 14nm node
Institution: Southwest Securities
Rating: Buy (Maintain)
Target price: HK$14.73
SMIC expects the 14nm to be put into production three months ahead of schedule, capital, technology, and management. The company recently announced the formation of a joint venture with China Integrated Circuit Industry Fund and Shanghai Integrated Circuit Industry Fund to establish SMIC South, with registered capital increased from the original 210 million US dollars to US$3.5 billion, focusing on advanced process R&D and mass production at 14nm and below. SMIC will complete plant construction and clean room renovation in 2018 as planned. The target will be put into operation in the first half of 2019. Double CEOs Liang Mengsong and Zhao Haijun bring SMIC Strong technical level and advanced management model have strengthened the construction of R&D team, adjusted and updated 14nm FinFET planning, locked 3D FinFET process in high performance computing, low power chip applications. SMIC pursues advanced technology The pace has increased and it is believed that the mass production in the future 14nm will be an important node of SMIC's revenue.
FinFET and FD-SOI are the key processes to solve the 14nm and below process. Compared to higher process technologies, the transistor channels of 14nm process are deeper, thinner, and closer to each other, so semiconductor performance, power consumption Significantly improved. As the process is reduced, the current control ability of the gate is drastically reduced, and current leakage will occur. The FinFET reduces the gate width while reducing the leakage rate by using a 3D structure. FD-SOI is more dominant than Bulk CMOS. An ultra-thin insulating layer called a buried oxide layer is located on top of the base silicon to form an ultra-thin transistor channel, which greatly reduces the leakage current.
SMIC expects UMC and G-Core to achieve a curve overtaking, and the gap with TSMC shows a narrowing trend. Intel used a second-generation FinFET structure at 14nm in 2014, and its 14nm technology outperforms all other competitors' 14nm. Process Technology. Samsung and Taiwan Semiconductor Manufacturing Co., Ltd. have mass-produced 14nm and 16nm technologies respectively in 2015, and their technical strength is on par with that. Both UMC and Globod have started mass production of 14nm process in 2017 and mass production time from 14nm technology. From the perspective of SMIC's 14nm technology, UMC and G-Core only have a gap of less than two years. SMIC is expected to achieve overtaking in the future and become the second largest pure wafer foundry in the world after TSMC. With Moore The slowing of the law, SMIC’s gap between the advanced manufacturing process below 28nm and TSMC’s years of age has narrowed.
Valuation and rating: SMIC's 28nm revenue ratio in 2017 is expected to reach the standard, 28nm yield rate will increase soon, 14nm R&D will accelerate, and it is expected to begin volume production at the beginning of 2019. We believe that the company's strategic position should be given a certain estimate. Value premium. In 2017, the company's net assets per share were 1.06 US dollars, which corresponds to 1.3 times the current PB. Considering PE and PB comprehensively, referring to the average PB of comparable companies, the company will ultimately give the company a 1.7x PB valuation in 2018, corresponding to a stock price of HK$14.73. Maintain 'Buy' rating.
Risk Warning: The company's capacity utilization rate or the risk of decline due to weakening demand for end products; Advanced process development and yield improvement progress may not be as expected; Wafer average price or risk of fluctuations Grundheim