Each wafer foundry recently released Q1 quarterly financial report, with revenue and profit increasing by different ranges. Among them, TSMC Q1 achieved a revenue of US $17.57 billion, an increase of 36% over the same period in 2021; The gross profit margin was 55.6%, up 2.9% month on month. Samsung Semiconductor division Q1 achieved a revenue of US $21.2 billion, a year-on-year increase of 39%; The operating profit was US $6.67 billion, a year-on-year increase of 151.5%. Liandian Q1 achieved a revenue of US $2.22 billion, a year-on-year increase of 34.7%; The gross profit margin was 43.4%, an increase of 16.9% over the same period last year Semiconductor Manufacturing International Corporation(688981) q1 achieved a revenue of US $1.84 billion, a year-on-year increase of 66.9%; Gross profit was US $750 million, a year-on-year increase of 200%.
Affected by the rising cost of raw materials, each wafer foundry may raise the price to varying degrees. In the 2023 order meeting with customers, TSMC informed that the OEM price of advanced and mature processes will be comprehensively increased by about 5% - 8% from January 2023. Samsung expects to increase the price of wafer foundry fees by 15% - 20% in 2022. Liandian plans to carry out a new round of price increase in the second quarter of 2022, with a range of 4% Semiconductor Manufacturing International Corporation(688981) is also negotiating the price increase with customers, but the specific scheme has not been determined.
The test of bargaining power escalated again, and the gathering trend of fabless head intensified. The shortage of OEM and the rise in price have led to a new round of cost rise. Whether the industrial chain has the bargaining power, whether the price can be transmitted and whether the production capacity can be guaranteed has become the key to ensure profitability and gross profit margin. The process of OEM price increase will accelerate the industry to gather to the head manufacturers with more barriers to products. Manufacturers with weak bargaining power will face the risk of upstream and downstream squeeze and reduction of gross profit margin.
Downstream prosperity has also become a key factor. At a time when the quotation remains high, the current part
IC application demand has been revised, mainly in consumer IC for mobile phone, consumer PC related fields, home appliance microcontroller (MCU), etc. When the demand of the mainland market recovers becomes the key. If the situation continues to be depressed, more consumer IC applications will be adjusted in the second half of 2022, and suppliers in areas with strong demand such as automobile, industry and server will face opportunities.
Investment suggestions:
Focus on leading enterprises with high product barriers, more bargaining power and stronger downstream demand. It is recommended to focus on Montage Technology Co.Ltd(688008) , Guoxin technology, Giantec Semiconductor Corporation(688123) , Gigadevice Semiconductor (Beijing) Inc(603986) , Changsha Jingjia Microelectronics Co.Ltd(300474) .
Risk tips:
Cost transmission is less than expected, downstream demand is less than expected, and capacity supply is less than expected.
