Core view
IGBT: demand growth + domestic substitution, China’s IGBT industry is expected to achieve large-scale growth
With the advantages of MOSFET and BJT devices, IGBT is known as the “CPU” of power electronics industry. IGBT is a composite fully controlled voltage driven power semiconductor device composed of BJT (bipolar triode) and MOS (insulated gate field effect transistor). It also has the advantages of high input impedance of MOSFET, low device driving power, fast switching speed, low saturation voltage of BJT device, high current density and low on voltage drop of GTR. For more than 30 years, IGBT has developed to the seventh generation, and its performance has been continuously optimized in all aspects. As the mainstream device of new power semiconductor devices, IGBT’s application fields include traditional industrial fields such as industry, 4C (communication, computer, consumer electronics and automotive electronics), as well as strategic emerging industrial fields such as rail transit, new energy, smart grid and new energy vehicles.
Domestic substitution space is huge, and the relationship between supply and demand remains tight. Benefiting from the gradual recovery of the industrial control and power supply industry market and the rapid development of downstream variable frequency household appliances, new energy vehicles and other fields, the global and Chinese IGBT market scale continues to grow. According to WSTS data, it is estimated that the global IGBT market will reach nearly US $5.7 billion in 2022, and the CAGR will reach 7.04% in 2017-2022. At present, the IGBT market is mainly occupied by large overseas manufacturers. Chinese enterprises started late, the self-sufficiency rate of high-end products is still low, and there is more room for domestic substitution. At present, the phenomenon of global IGBT shortage and price rise is still obvious. Chinese enterprises are expected to seize the opportunity to accelerate domestic substitution, and the market share may increase rapidly.
There is strong market demand for new energy vehicles, charging piles, photovoltaic and wind power, and the market demand for IGBT continues to expand. IGBT is widely used downstream. The rapid development of emerging fields such as new energy vehicles, charging piles and renewable energy power generation will drive the continuous expansion of market space.
(1) New energy vehicles: the trend of vehicle electrification drives the rapid growth of IGBT market demand. It is expected that the scale of IGBT in Shanxi Guoxin Energy Corporation Limited(600617) vehicle market will reach 38.5 billion yuan in 2025 and 33.8% CAGR in 2019-2025. (2) Charging piles: the rapid development of new energy vehicles drives the continuous increase in the number of supporting charging piles. It is estimated that the number of charging piles in China will rise to 12.4 million in 2025. According to the market cost of various charging piles and the cost of IGBT in charging piles accounting for 20%, it is estimated that the market scale of IGBT in charging piles in China will reach 32.4 billion yuan in 2025 and 49.1% CAGR in 2021-2025. (3) renewable energy (photovoltaic & wind power): under the background of actively promoting carbon neutrality in all countries around the world, the development of renewable energy has entered the fast lane. As the core component of photovoltaic inverter and wind power frequency converter, it is expected that the market scale of photovoltaic inverter and wind power frequency converter power devices and IGBT in China will reach 10.55 billion yuan and 27.774 billion yuan respectively in 2025, and the CAGR will reach 17.2% and 10.4% respectively in 2021-2025.
Investment suggestion: for overseas leading enterprises, it is recommended to focus on leading enterprises in each segment with strong overall R & D strength and high-end product layout.
Risk statement
(1) The downstream demand is lower than expected (2) the progress of domestic substitution is lower than expected (3) the risk of price decline caused by market competition
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