H2 procurement tide revived, and the proportion of domestic products increased. In 2021, the leading local Fab Semiconductor Manufacturing International Corporation(688981) (Shaoxing), Changjiang storage and Huahong Hongli (including Huahong semiconductor and Shanghai Huali) completed a total of 899 equipment bidding, with a year-on-year increase of 54%. The procurement peak in the first half of the year was concentrated in January and April, and the main orders came from Huahong Wuxi and Changjiang storage respectively. The procurement peak in the second half of the year occurred in July and September, and the bidding for 91 units and 110 units were completed respectively, with the main increment contributed by Changjiang storage. Throughout the year, scalar equipment accounted for 21% of domestic equipment, and the localization rate of cleaning, degumming, gluing development, etching and CMP was high.
Details of bidding results of three wafer factories in 2021:
1) Hua Hong: 267 sets, 47 sets made in China, with a localization rate of 18%;
2) Changjiang storage: 475 sets, 71 sets made in China, with a localization rate of 15%;
3) SMIC Shaoxing: 157 sets, 70 sets made in China, with a localization rate of 45%.
In December, Huahong started a large number of bidding again. In December, Huahong announced the new bidding for 292 wafer plant equipment. It includes 7 photolithography units, 9 gluing and developing units, 58 film deposition units, 49 etching units, 80 furnace tubes, 18 ion implantation units, 20 CMPs, 26 cleaning units, 20 degumming units, 3 back channel packaging equipment and 2 auxiliary equipment. The main purchaser is Huahong Wuxi. This bid opening is unprecedented, exceeding the number of bidding completed in the whole year of 21 years. We are optimistic about Huahong’s capacity expansion in early 22.
2021 bid winning details of domestic equipment manufacturers:
1) Naura Technology Group Co.Ltd(002371) 27 sets, including film / etching / furnace tube;
2) Shengmei 18 sets, including wet cleaning / gluing development / rear packaging;
3) 16 medium and micro devices, all of which are dry etching;
4) Kingsemi Co.Ltd(688037) 16 sets, including gluing development / wet etching / wet cleaning / wet degumming;
5) Yitang 15 sets, including dry degumming / dry etching;
6) 13 sets of tuojing, all of which are thin films;
7) Huahai Qingke 10 sets, all CMP;
In addition, shengjisheng and jimsy won the bid for a total of 17 sets, and the second-hand equipment occupied a certain market share.
Investment suggestion: the active expansion of downstream wafer plants in 2021 has promoted the growth of bidding procurement of semiconductor equipment, and 22 years will still be a year for the accelerated implementation of local wafer production lines. Huahong’s substantial increase in bidding volume in December reflects the strong willingness of the wafer factory to expand production and the continued prosperity of the equipment market in 22 years. In addition, in the current low localization rate base, we see more and more domestic equipment manufacturers emerge. We believe that under the superposition of production expansion and localization, the equipment sector is expected to maintain high growth. We suggest paying attention to Naura Technology Group Co.Ltd(002371) , Advanced Micro-Fabrication Equipment Inc.China(688012) , Shanghai Wanye Enterprises Co.Ltd(600641) , Kingsemi Co.Ltd(688037) .
Risk tip: the downstream demand of the semiconductor industry is less than expected, the production expansion progress of the wafer factory is less than expected, and the equipment R & D progress is less than expected.
