Affected by multiple factors, China's IC output fell month by month after reaching the peak in August 2021, and the monthly growth rate fell sharply from 43.9% in June last year to 1.9% in December.
According to the latest operation monitoring report of the electronic industry in the first quarter of 2022 released by the China Academy of communications and communications, since this year, the output of integrated circuits has continued the downward trend. In March, the output fell to 28.5 billion pieces, a year-on-year decrease of 5.1%. In the first quarter, the cumulative output of integrated circuits reached 80.7 billion pieces, a year-on-year decrease of 4.2%. The quarterly cumulative output shrank for the first time since the second half of 2019.
The Academy said that the decline in output was mainly due to factors such as the unexpected changes in China's external environment, the weak demand side situation and the hoarding of chips in the market. Considering the continuous warming of the epidemic in Shanghai since April, the production capacity of major manufacturers such as Shanghai and Kunshan has been impacted to varying degrees, and the logistics transportation of the supply chain has been blocked, it is expected that the IC production will bear greater pressure in the second quarter.
In addition to the Chinese market, the global IC supply and demand is still in an "unbalanced" state. According to the research of Susquehanna financial group, the waiting period for semiconductor delivery increased slightly in March, reaching a new high of 26.6 weeks.
Although consumer demand has shrunk, in the view of the upstream giants of integrated circuits, the current market demand for chips is still huge, and the upstream production capacity is still tight.
At the first quarter earnings briefing held last week, Peter Weininger, CEO of global lithography giant asmai, said that a large industrial group had begun to buy washing machines and dismantle the semiconductors for its own chip modules.
Although the name of the manufacturer was not disclosed, he said the situation was not "rare". In addition, Peter wenningke said that the full capacity of a major Chinese chip manufacturer by the end of next year had been sold out ahead of schedule.
"The utilization of ASMA machines is at an all-time high, which shows that customers buy more not for inventory, but because they can't keep up with market demand." Asmai said that in the second quarter of this year, the market demand for chip manufacturing equipment exceeded the supply, so it raised its long-term revenue expectation and maintained the revenue growth of 20% this year and the capacity expectation of 55 extreme ultraviolet lithography machines. However, due to capacity constraints, asmai can only meet about 60% of the demand of its deep ultraviolet lithography (DUV) system (one of the most commonly used tools for etching chip circuits).
In addition, affected by the rise in labor, parts, freight and energy prices, asmai's gross profit margin is expected to grow by only about 1% this year. Asmai's share price has fallen by more than 20% since the beginning of this year because its profit is less than market expectations.
In the Chinese market, the stock price of integrated circuit sector is also not optimistic.
According to the statistics of Minsheng electronics, from the beginning of this year to mid April, the CS electronics sector fell by 32.10%, ranking first in the decline list. In terms of valuation, the current electronic sector TTM PE is only 31.01 times, which is close to the bottom position in early 19. From the perspective of prosperity, mobile phones have fallen to the bottom. Affected by the epidemic, it is expected to delay to Q2 recovery.
Due to the recent epidemic in China, the production and operation of integrated circuit enterprises has also attracted the attention of the capital market.
In terms of the number of listed companies, nearly 30% of the 94 semiconductor companies listed on A-Shares are located in Shanghai, mainly semiconductor design companies (22), in addition to Semiconductor Manufacturing International Corporation(688981) , Huahong Hongli and other wafer foundries, as well as National Silicon Industry Group Co.Ltd(688126) , Advanced Micro-Fabrication Equipment Inc.China(688012) , shengmei Shanghai and other semiconductor materials and equipment companies.
The above institutions believe that although the overall operation of the industry has gradually returned to normal, some links such as logistics are still in a tight state. Recently, the Ministry of industry and information technology has sent a working group to Shanghai to concentrate resources and give priority to ensuring the resumption of work and production in key industries such as integrated circuits.
In addition, many institutions believe that the current market has been overly pessimistic about the electronic sector, and the sector correction is close to the bottom of history.
From the production expansion of upstream wafer equipment manufacturers, according to the statistics of Minsheng electronics, 171 sets of new equipment were tendered in March 2022, including 40 sets of Huahong Wuxi, 4 sets of Shanghai Huali, 103 sets of Jita, China Resources Microelectronics Limited(688396) (Chongqing) 11 sets and 13 sets of Fujian Jinhua. Compared with the bidding completion data, the new bidding data structure this month is richer, and more wafer factories show their willingness to expand production.
It is worth noting that in the first quarter of the quarter, Chinese mainland occupied 34% of asimai equipment sales, a big increase compared with the 22% share in the fourth quarter of 2021, indicating that the overall market demand is not pessimistic in the long run.
