The demand of China's semiconductor market promotes the growth of voice chip market

Zhitong finance app learned that GF Securities published a research report that semiconductors are highly capital intensive and technology intensive industries and are a must for major countries in the world. As the largest consumer market of semiconductors in the world, the rise of China's semiconductor industry is imperative, and the whole semiconductor industry chain is expected to continue to benefit, both from the regional supporting advantages and the national will. It is recommended to pay attention to wafer foundry enterprises with a certain scale, SMIC International (00981), Huahong semiconductor (01347) and ASM Pacific (00522), a global semiconductor packaging and testing equipment manufacturer.
The global semiconductor industry returns to the upward cycle. From the perspective of the industrial chain, the upstream of semiconductor mainly includes equipment and materials, the midstream IC production includes several links of "design manufacturing packaging testing", and the downstream applications are mainly concentrated in computer, consumer electronics, network communication, automotive electronics and other fields. According to different types, semiconductor products are mainly divided into four parts: integrated circuit (IC), optoelectronics, discrete devices and sensors. According to WSTS statistics, in 2016, integrated circuit sales accounted for 82%, optoelectronics accounted for 9%, discrete devices accounted for 6% and sensors accounted for 3%.
Over the years, IC sales have accounted for more than 80% of semiconductor sales, so IC is generally referred to as semiconductor in the market. In addition, integrated circuits are divided according to different functions and uses, mainly including four categories: microprocessor (about 18%), memory (about 23%), logic chip (about 27%) and analog chip (about 14%). At present, there are two business models in the global IC industry: IDM (integrated device manufacturer) model and vertical division of labor model. IDM refers to a business model that is completed by one company from design, manufacturing, packaging and testing to sales of its own IC products; Vertical division of labor refers to the business model in which the design, manufacturing and package testing of IC are undertaken by professional IC designers (fabless), IC manufacturers (Foundry) and IC package & testing respectively; At present, IDM mode still plays a major role in the world.
In 2016, the total revenue of the top 20 global manufacturers accounted for about 80% of the global semiconductor sales. Among the top 20, the revenue scale of IDM manufacturers accounted for about 68%, fabless accounted for 18% and foundry accounted for 14%. Semiconductor industry is a cyclical industry, and its development is highly correlated with GDP, which is positively correlated as a whole. In recent years, with the development of new generation information technology in artificial intelligence, big data, Internet of things, AR / VR, wearable devices and other fields, the semiconductor industry has entered a new round of business cycle.
According to the statistics of the world semiconductor trade statistics organization WSTS, the compound growth rate of global semiconductor sales from 2003 to 2016 was 5.21%, of which the global semiconductor sales realized US $338.9 billion in 2016, a year-on-year increase of 1.12%. WSTS predicts that the global semiconductor sales scale will reach US $396.6 billion in 2017, with a year-on-year growth rate of 17%. By 2020, the whole market is expected to reach US $400 billion.
In recent years, China's semiconductor market has strong demand, and the growth rate of voice chip IC market is significantly higher than that of the world. According to WSTS statistics, in 2016, China's semiconductor consumption was US $107.5 billion, accounting for 32% of the global total, surpassing the United States, Europe and Japan and becoming the world's largest market. Meanwhile, according to the statistics of China Semiconductor Industry Association (CSIA), China's integrated circuit sales have maintained a double-digit growth rate in recent years, of which the year-on-year growth rate of China's integrated circuit sales in 2016 reached 20.1%. However, on the whole, the self-sufficiency rate of the domestic IC market is still at a low level, and the products are mainly imported from abroad.
IC materials: domestic manufacturers have stepped into the fast lane of development. IC materials are mainly divided into IC manufacturing materials and IC packaging materials. IC manufacturing materials mainly include silicon wafer and substrate, photomask, photoresist, electron gas, CMP material, target, etc; IC packaging materials include laminated substrate, lead frame, welding wire, molding compound, underfill, liquid sealant, crystal bonding material, tin ball, etc.
According to the semi report, the global IC manufacturing material market in 2016 was US $24.7 billion and the packaging material market was US $19.6 billion. Among IC manufacturing materials, silicon wafer accounts for the highest proportion, up to 32%, and silicon wafer and mask, electronic gas, CMP material and photoresist account for nearly 80%, which is the most important material affecting IC manufacturing process. Wafer is the substrate of IC processing, and from the development process of wafer materials, it can be roughly divided into three generations: the first generation is represented by germanium and silicon; The second generation is mainly gallium arsenide and indium phosphide; The third generation is gallium nitride, silicon carbide, etc.
At present, most wafers still use silicon as the main raw material. From the global competition pattern of silicon wafer materials, this market is mainly dominated by Japanese manufacturers. According to the statistics of semi in 2015, shinyue and sumco are the leading manufacturers in the silicon wafer production industry, accounting for about 50% of the market share. According to SEMI report, the Chinese mainland IC manufacturing material market in 2016 was 6 billion 530 million US dollars, and has become the world's fourth largest IC manufacturing material market, second only to Taiwan, Korea and Japan.
IC equipment: the trend of localization is beginning to appear. IC equipment is the upstream supporting equipment for IC production. IC equipment is basically needed in IC design, manufacturing, packaging and testing. According to different functions and uses, IC equipment is generally divided into three categories: IC manufacturing equipment, IC packaging equipment and IC test equipment. Among them, IC manufacturing equipment has the most types and accounts for the largest proportion, such as lithography machine, etching equipment, film deposition and other core wafer processing equipment; IC packaging equipment mainly includes bonding machine, plastic sealing machine, etc; IC test equipment mainly includes sorting machine, testing machine, probe table, etc., which is suitable for the end test of IC design, manufacturing and packaging.
IC equipment industry has high technical barriers. At present, European, American and Japanese manufacturers still occupy an absolutely dominant position. Applied materials, ASML, Tokyo electronics and Lam research are the top four semiconductor equipment manufacturers in the world, with market shares of about 19%, 18%, 16% and 15% respectively. The rapid development of domestic downstream IC production links has driven the vigorous demand of domestic IC equipment market. According to semi's survey, the scale of China's semiconductor equipment market in 2016 was US $6.46 billion, with a year-on-year increase of 31.8%. It has the fastest growth rate in the world and has become the third largest semiconductor equipment market after Taiwan and South Korea. According to semi estimates, the demand for IC equipment by Chinese local enterprises will increase rapidly from 2018 to 2020. It is estimated that the investment in IC equipment will be US $10.8 billion, US $11 billion and US $17.2 billion respectively.
With the continuous improvement of market demand, domestic IC equipment manufacturers continue to increase R & D efforts, and China has made breakthroughs in many key equipment fields in the past two years. IC Design: domestic manufacturers are emerging. Integrated circuit design is the process of transforming the design requirements of system, logic and performance into specific physical layout. The IC design process is divided into several steps: specification customization, hardware language description, simulation verification, logic synthesis, circuit simulation verification, circuit layout and surround, circuit detection, mask fabrication and so on.
According to IC insights data, in the field of pure IC Design (fabless), the United States accounted for the largest market share. In 2016, the total capacity of American IC fabless manufacturers accounted for 62% of the world. Qualcomm and Broadcom are the leading manufacturers in the IC fabless industry, and their total revenue accounts for 51% of the total revenue of the top ten. In 2016, Qualcomm's revenue was $15.4 billion and Broadcom's revenue was $15.3 billion. Benefiting from the demand of domestic downstream mobile, communication and other fields, the competitiveness of domestic IC designers began to appear. According to IC Insights statistics, only 1 Chinese mainland enterprises were in the global TOP50 Fabless business in 2009, and by 2016, the number of Chinese mainland enterprises has reached 11, and the share of the merged market has increased to 10%. Among them, Huawei Hisilicon and Spreadtrum have ranked among the top ten fabless businesses in the world.
IC manufacturing: with the greatest policy support, domestic manufacturers catch up. IC manufacturing is the process of etching integrated circuits on wafers. IC manufacturing process includes surface grinding, cleaning, coating, multiple lithography, ion implantation, etching, heat treatment, defect removal, polishing, cleaning, inspection, packaging and other processes. At present, international leading manufacturers have developed the process to 10nm level. Leading manufacturers such as TSMC and Samsung have achieved mass production of 10nm process. Intel and grofangde are expected to achieve mass production by the end of this year. In addition, TSMC is taking the lead in developing 7Nm process technology.
According to IC insights data, in the field of pure IC manufacturing, Taiwan accounted for the largest market share. In 2016, the total capacity of foundries in Taiwan accounted for 73% of the world. Among them, TSMC's revenue was US $28.57 billion, accounting for 58% of the global market share. IC manufacturing is a capital and technology intensive industry, which is the focus of national policies and funds. Among the funds invested in IC manufacturing, 12 inch wafer factories account for the largest proportion. This is mainly because the global demand for 12 inch wafers is the largest, while the capacity of domestic enterprises accounts for a very low proportion.
According to the statistics of China Electronics Network, at present, the global monthly demand for 12 inch semiconductor silicon wafers is about 5.1 million, and the total monthly production capacity of the existing 12 inch factories in the mainland is only about 460000. The huge capital injection has driven the rapid growth of domestic 12 inch wafer production line. According to the SEMI estimates, 62 new Fabs will be put into operation in the world from 2017 to 2020, and 26 of them will be located in Chinese mainland, accounting for 42% of the total world. Most of the 26 new Fabs are 12 inch fabs.
At present, the capacity of the 12 inch wafer factory under construction is about 630000 pieces, and the monthly capacity of the 12 inch wafer factory in the mainland will be as high as 1.09 million pieces in the future. The rapid expansion of domestic manufacturers' production capacity has also led to the rapid improvement of their own sales scale. As the leading enterprises in the domestic IC manufacturing industry, SMIC international and Huahong semiconductor have followed the trend, and their market share has increased year by year in recent years. At present, both enterprises are among the top ten foundries in the world.
IC packaging test: domestic manufacturers have certain competitive strength. IC packaging test is a labor-intensive industry, and the overall entry barrier of the industry is not high. From the perspective of regional distribution, it is mainly concentrated in the Asia Pacific region. According to IC insights, rimoonlight, Amkor, Changdian technology and silicon products are the top four packaging and testing manufacturers in the world. With the advantage of low labor cost, China has a certain competitive strength in the labor-intensive IC packaging and testing industry. At the same time, it is also the most internationally competitive link in China's IC industry chain.
At present, the domestic packaging and testing industry presents a tripartite situation of wholly foreign-owned, Sino foreign joint venture and domestic capital, and the domestic packaging industry has formed a certain competitiveness. According to the statistics of IC insights, domestic enterprises such as Changdian technology, Huatian technology and Tongfu micro power have entered the top 20 sealing and testing enterprises in the world. With the continuous overseas acquisition, reorganization and merger of domestic enterprises, domestic manufacturers are expected to further improve their market share in the future.
In recent years, with the increasing gap between supply and demand in China's semiconductor market, the state has also issued a series of policies to vigorously support the development of China's IC industry. From the perspective of investment destination, the National IC industry investment fund is now more focused on IC manufacturing; From the perspective of investment strategy, the fund focuses on investing in backbone enterprises in each link of the industrial chain; From the perspective of regional distribution, the investment in Beijing, Shanghai, Wuhan, Fujian, Jiangsu and Shenzhen accounts for 90% of the total investment. The establishment of large funds has greatly boosted the investment confidence of the industry and society in the IC industry. At present, local governments have also set up funds to support the IC industry.
By the first half of 2017, the scale of integrated circuit investment fund established by local governments had exceeded 300 billion yuan. Driven by policies and funds, the semiconductor industry has achieved initial results: in the field of IC materials, China has broken through the 12 inch silicon wafer technology, and mass production is expected by the end of this year. Advanced high-end targets, high-purity chemical reagents, photoresists and other materials have been put on the market; In the field of IC equipment, domestic high-end lithography machines, etching machines and other equipment have achieved zero breakthrough, and are gradually catching up with the international advanced level; In the field of IC design, domestic manufacturers represented by Hisilicon and Spreadtrum began to emerge, and their market share gradually increased; In the field of IC manufacturing, China has broken through the 28nm process, and 12 inch wafer factories are also growing rapidly; In the field of IC packaging and testing, domestic manufacturers already have a certain competitive strength.
Semiconductor is a highly capital intensive and technology intensive industry. It is an indisputable place for major countries in the world. GF Securities believes that China, as the largest consumer market of semiconductors in the world, will usher in the best growth opportunity for China's semiconductor industry from the perspective of regional supporting advantages or national will, and the overall industrial chain is expected to continue to benefit. It is suggested to pay attention to SMIC, Huahong semiconductor and ASM Pacific, a global semiconductor packaging and testing equipment manufacturer with a certain scale.
SMIC: China's leading foundry maker, SMIC, was founded in 2000, and is the largest and the fourth largest foundry in Chinese mainland. At present, SMIC is the only IC manufacturer in the mainland that has broken through the 28nm process. The company currently provides foundry and technical services for 0.35 micron to 28nm wafers. In 2016, SMIC achieved sales revenue of USD 2.914 billion. The company's gross profit margin remained at a high level, reaching 29.2% in 2016. From the composition of product revenue, the proportion of advanced processes below 65nm is on the rise. From the perspective of product downstream applications, the company's customers mainly come from the fields of communication and consumption, which account for more than 85% of revenue.
According to IHS, Huahong semiconductor is the second largest 200mm wafer foundry in the world. As of June 2017, the company's 200mm wafer production capacity reached 159000 pieces per month. In terms of revenue scale and gross profit margin, it has shown an overall upward trend in recent five years. In 2016, the company's revenue reached US $721 million, with a gross profit margin of 30.5%. In terms of downstream applications, the company's products mainly focus on embedded nonvolatile memory and power devices, and are oriented to bank cards, bus cards, ID cards, IGBT and other fields.
ASM Pacific: ASM Pacific (ASMP), the world's largest supplier of semiconductor packaging equipment, was established in Hong Kong in 1975. It is the world's largest collection of semiconductors and light emitting diodes

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