On January 29, National Silicon Industry Group Co.Ltd(688126) announced that the subsidiary intends to sign a long-term supply agreement and related party transactions, and signed a long-term supply agreement with Changjiang storage for 300mm silicon wafer (i.e. 12 inch silicon wafer) products for integrated circuits.
According to the announcement, the company’s subsidiary Shanghai Xinsheng plans to sign long-term supply agreements with Changjiang storage and Wuhan Xinxin respectively. The total amount of the above long-term supply agreements is expected to be more than 30 million yuan, accounting for more than 1% of the company’s total assets audited in the latest period.
For the long order signed this time, National Silicon Industry Group Co.Ltd(688126) said that this transaction will help to further establish a strategic partnership with customers, commit to mutual benefit and win-win results, and lay a good foundation for long-term cooperation.
“This long order reflects at least two messages: one is that the supply of 12 inch semiconductor silicon wafers continues to exceed the demand this year; the other is that the shipment volume of National Silicon Industry Group Co.Ltd(688126) can continue to increase significantly.” For the long order announcement of National Silicon Industry Group Co.Ltd(688126) , some people in the semiconductor industry disclosed that National Silicon Industry Group Co.Ltd(688126) will be fully produced and sold in 2021, and the production capacity can not meet the needs of China’s major wafer factories; In 2022, under the situation of short supply, China’s major wafer factories have signed long-term order agreements with Chinese wafer manufacturers such as National Silicon Industry Group Co.Ltd(688126) .
The reporter noted that National Silicon Industry Group Co.Ltd(688126) disclosed that the estimated amount of related party transactions between the company and Changjiang storage from January to June was 155 million yuan, and the estimated amount of related party transactions with Wuhan Xinxin was 80 million yuan. From January to November 2021, National Silicon Industry Group Co.Ltd(688126) had commodity transactions with Changjiang storage and Wuhan Xinxin, with the amount of 143 million yuan and 103 million yuan respectively. A simple comparison shows that in the first half of this year, National Silicon Industry Group Co.Ltd(688126) shipments to Changjiang storage and Wuhan new core are expected to catch up with the whole year of last year, and the growth rate of shipments is considerable.
A background that needs to be emphasized is that the global demand for semiconductors is growing rapidly, and the silicon wafer industry has started a new upward cycle. Based on the price increase in 2021, the industry generally believes that the price of silicon wafer will still be in the rising channel in 2022. Many industry insiders believe that semiconductor silicon wafer will be one of the most deterministic segments in 2022.
In addition, National Silicon Industry Group Co.Ltd(688126) disclosed two investment Announcements: first, the company subscribed for Xinhua semiconductor’s new registered capital of 16.32 million yuan (holding 1.0323% after investment) with 32 million yuan; second, Shanghai Xinsheng plans to invest 3.457 billion yuan in the construction of “integrated circuit silicon material engineering R & D supporting” project in Lingang New Area.
Statistics show that Xinhua semiconductor was founded in December 2015 with a registered capital of 1.479 billion yuan. It is mainly engaged in the R & D, manufacturing and sales of semiconductor materials, electronic materials, high-purity materials and by-products. The company’s main products are electronic grade polysilicon materials. In 2021, the unaudited operating revenue of Xinhua semiconductor was 798 million yuan and the net profit was -812.368 billion yuan.
The site area of the “integrated circuit silicon material engineering R & D supporting” project is about 100 mu, and the planned construction land area is 66757 square meters. It will build public auxiliary facilities such as R & D comprehensive office building, R & D pilot test line, test and verification platform, laboratory, warehouse, power station and power supporting facilities, as well as living supporting facilities such as employee single apartment and restaurant. The project plans to build a silicon material engineering technology R & D experimental base, including a public testing platform that provides services to third parties.
For the investment in Xinhua semiconductor, National Silicon Industry Group Co.Ltd(688126) said that at present, Xinhua semiconductor has developed into one of the enterprises in China that systematically master the purification technology of high-purity electronic grade polysilicon and successfully mass produce and form downstream batch sales. The company has demonstrated the production and use of its electronic grade polysilicon materials and made some progress; The capital increase of the company will further cultivate Chinese electronic grade polysilicon suppliers and promote the local supply of raw materials.
National Silicon Industry Group Co.Ltd(688126) said that the completion of the “integrated circuit silicon material engineering R & D supporting” project will change China’s deficiencies in silicon material engineering research and application, drive the development of China’s silicon material supporting industry, drive regional scientific and technological innovation, and effectively drive the continuous innovation of local upstream and downstream industries related to silicon materials.
“Electronic grade polysilicon is an important raw material and an indispensable part of the integrated circuit industry, especially silicon wafer factories. Investing in silicon materials will help National Silicon Industry Group Co.Ltd(688126) build a more stable supply chain.” The above semiconductor industry insiders believe that, more importantly, National Silicon Industry Group Co.Ltd(688126) investment in Xinhua semiconductor will help more integrated circuit materials, including electronic grade polysilicon, complete engineering and mass production.
