The silicon wafer market continues to grow and is an oligopoly. Silicon wafer is the most upstream material in the semiconductor industry chain. According to semi statistics, in 2020, silicon wafer accounted for 36.64% of the global wafer manufacturing material market, which is the material with the highest proportion in the wafer manufacturing material market. In 2021, the global silicon wafer market increased significantly: the market scale reached US $12.62 billion, a year-on-year increase of 13%; Shipments reached 14.165 billion square feet, a year-on-year increase of 14%. The main producers of silicon chips are concentrated in Japan, China, Taiwan, Germany and Korea. The global silicon wafer market is oligopoly, and the top five companies account for 86.6% of the global silicon wafer market
Silicon wafers are in short supply, and industry leaders actively expand production. Since the fourth quarter of 2020, the global chip shortage crisis has continued to ferment. As the upstream material of IC manufacturing, the problem of insufficient supply of silicon wafer is also serious. The shortage of silicon wafer supply is expected to continue until 2026. Silicon wafer manufacturers have announced investment plans to deal with the shortage of silicon wafer supply. Sumco plans to invest 228.7 billion yen (about US $2.05 billion) to expand the production of advanced process 12 inch silicon wafers. Universal wafer announced that it would spend a total of NT $100 billion (about US $3.6 billion) from 2022 to 2024 to expand its existing plant and build new plants. Sk silon, a silicon wafer manufacturer under SK group, announced that it would invest 1.05 trillion won (about US $860 million) in the next three years to expand its 12 inch silicon wafer manufacturing plant.
Wafer factories continue to expand production, and there is room for silicon wafer prices to rise. Semi predicts that 38 12 inch wafer plants will be built in the world from 2020 to 2024. The increase in capacity and market share of newly released factories in Chinese mainland will stimulate the market demand of upstream semiconductor materials industry. The expansion of wafer factories will stimulate the demand for upstream silicon wafers. It will take time for silicon wafer manufacturers to release their new production capacity. The silicon wafer market may continue to face a market situation in which supply exceeds demand. There is room for silicon wafer prices to rise. It is suggested to continue to pay attention to the silicon wafer sector.
The market of electronic sector is weaker than the market
From March 21 to March 25, the Shanghai Stock Exchange fell by 1.19%, and the electronic sector fell by 3.27%, underperforming the market by 2.07 percentage points. Year to date, the Shanghai index fell 11.75%, CITIC electronics fell 23.12%, underperforming the market by 11.37 percentage points.
Increase in electronic industry segments
From March 21 to March 25, there was no rise in the segments of electronics industry. Year to date, the electronic industry segments are negative returns.
Rise and fall of individual stocks: A shares
From March 21 to March 25, the top five companies in the electronics industry were Wuxi Etek Microelectronics Co.Ltd(688601) , Ocean’S King Lighting Science & Technology Co.Ltd(002724) , Zhejiang Mustang Battery Co.Ltd(605378) , Shen Zhen Australis Electronic Technology Co.Ltd(300940) , Suzhou Recodeal Interconnect System Co.Ltd(688800) , up 28.12%, 14.61%, 13.70%, 11.69% and 9.91% respectively.
Investment advice
It is recommended to pay attention to Hangzhou Lion Electronics Co.Ltd(605358) , National Silicon Industry Group Co.Ltd(688126) , Tianjin Zhonghuan Semiconductor Co.Ltd(002129) , Konfoong Materials International Co.Ltd(300666) , Naura Technology Group Co.Ltd(002371) , Advanced Micro-Fabrication Equipment Inc.China(688012) , Thinkon Semiconductor Jinzhou Corp(688233) , Huahong semiconductor, etc.
Risk tips
Industry development is less than expected, industry competition intensifies, and downstream demand is less than expected.
