Summary of the latest developments 1 The US Department of Commerce will include 33 Chinese entities in the so-called “unverified list”. On February 7, the Bureau of industry and security (BIS) of the U.S. Department of Commerce announced that 33 Chinese entities would be added to the export control “unverified list” (UVL) from February 8, including semiconductor equipment company Shanghai microelectronics. We believe that the impact of the sanctions on the semiconductor industry is mainly short-term sentiment, and the actual impact on the company’s actual business and the development of China’s semiconductor industry is very limited. First of all, the list is the one with less impact among the six major lists currently used by the United States in China. Compared with the entity list (hereinafter referred to as EL), the scope of impact on the supply chain related to the United States is relatively limited. Secondly, compared with the entity list, the UVL list is easier to move out. BIS has a clear statement on the “exit mechanism” in the relevant items of UVL, and enterprises that meet the relevant conditions can apply for moving out. We believe that this sanction will not change the trend of domestic substitution of semiconductors, but will accelerate the localization of China’s industrial chain. 2. The trend of global wafer factory expansion is obvious, driving the demand for semiconductor materials. Considering that the expansion of semiconductor plants will take about the second half of 2022-2020, which will lead to a significant shortage of materials, we believe that the expansion of semiconductor plants will take about 2022-2020. Since the Sino US trade friction, the demand for the localization of semiconductor materials has become stronger and stronger. To meet China’s growing demand for high-end semiconductor materials, Chinese semiconductor material enterprises have accelerated product technology R & D and capacity expansion. It is recommended to pay attention to domestic silicon wafer manufacturers National Silicon Industry Group Co.Ltd(688126) , Hangzhou Lion Electronics Co.Ltd(605358) , layout Jiangsu Yoke Technology Co.Ltd(002409) of precursors and electronic special gas materials, polishing liquid faucet Anji Microelectronics Technology (Shanghai) Co.Ltd(688019) , target enterprise Konfoong Materials International Co.Ltd(300666) , high-end photoresist enterprise Jingrui shares, Jiangsu Nata Opto-Electronic Material Co.Ltd(300346) , etc.
Driven by the strong demand for 5g terminals and automotive electrification, the profit side of the electronics industry will accelerate growth in 2022 and maintain the “recommended” rating. In terms of domestic substitution of semiconductors, it is suggested to pay attention to the field of wafer OEM Semiconductor Manufacturing International Corporation(688981) (0981. HK), Huahong semiconductor (1347. HK), etc; Maxscend Microelectronics Company Limited(300782) (300782. SZ), Wingtech Technology Co.Ltd(600745) (600745. SH), Montage Technology Co.Ltd(688008) (688008. SH) with core competitiveness in the design field; In terms of equipment, it is recommended to pay attention to Naura Technology Group Co.Ltd(002371) (002371. SZ), Advanced Micro-Fabrication Equipment Inc.China(688012) (688012. SH), etc. In terms of automotive electronics, it is recommended to pay attention to intelligent cockpit company Foryou Corporation(002906) (002906. SZ), camera enterprise Shunyu optical technology (2382. HK), Lianchuang Electronic Technology Co.Ltd(002036) (002036. SZ), Ofilm Group Co.Ltd(002456) (002456. SZ) and vehicle specification CIS supplier Will Semiconductor Co.Ltd.Shanghai(603501) (603501. SH). In terms of consumer electronics, it is recommended to pay attention to the leading VR manufacturer Goertek Inc(002241) (002241. SZ) and the core targets of the iPhone industry chain Luxshare Precision Industry Co.Ltd(002475) (002475. SZ), Avary Holding (Shenzhen) Co.Limited(002938) (002938. SZ), etc. In terms of LED, it is suggested to pay attention to the downstream display faucet Leyard Optoelectronic Co.Ltd(300296) (300296. SZ), LED chip faucet Sanan Optoelectronics Co.Ltd(600703) (600703. SH) and China led solid crystal machine faucet Shenzhen Xinyichang Technology Co.Ltd(688383) (688383. SH).
