Recent news of price increases in the electronics industry has continued. According to the “Science and Technology Innovation Board Daily” summary, these price increases news are concentrated on passive components and semiconductor industry chains. Entering April, many companies’ price increase letters are about to take effect. Investment opportunities are also expected to attract market attention again.
The price increase effect of passive components has been reflected
Yageo, the leader in passive components, has always been at the forefront of price increases. A few days ago, the factory notified customers to increase the price of MLCC by at least 10% from April. After the price increase of 5%-15% at the beginning of this month, its aluminum capacitor factory, Kaimei, issued a price increase notice again. The price increases are aimed at medium-sized contract customers and agents. , the price increase is 6%, effective from April 1. In addition, the market expects that Yageo’s tantalum capacitor prices will also increase in April.
It is reported that Huaxinke has also issued a notice to increase the MLCC quotation by 30% to 40% recently, which is at least twice as high as that of Yageo.
The effect of price increases has been reflected in performance. According to statistics, the A-share passive component industry will return to the growth track as a whole in 2020, and the net profit attributable to the parent will generally increase by more than 50% year-on-year. The 20Q4 single-quarter performance growth of Sanhuan Group, Hongda Electronics, Hongyuan Electronics, and Fenghua Hi-Tech has exceeded 100% year-on-year.
A new round of price increases in April is expected to boost the Q2 performance of the above-mentioned manufacturers again. Guosheng Securities released a research report on March 28, saying that benefiting from the recovery of demand for smartphone, PC, notebook, and automotive electronics, the accelerated penetration and popularization of 5G, the rising demand for downstream products, the active replenishment of end customers, and the difficult supply and demand gap for passive components. The delivery period of Japanese Murata remains high, and Samsung Motors of South Korea has raised its quotations. Domestic manufacturers are expected to follow up strongly, and prices have started an upward cycle. In the future, the ease of chip shortages may further boost the market demand for passive components, and a high degree of prosperity can be expected throughout the year.
The tide of semiconductor price hikes spreads to every link
Following the 8-inch wafer, TSMC’s 12-inch wafer will increase in price from April, and the wafer will increase by about US$400/piece. Another news said that TSMC will increase the driver chip foundry quotation from April, and the driver chip price will increase. The trend is further upgraded, and the semiconductor products of UMC and NSMC are also expected to increase by 10% in April.
In addition, the supply chain said that Taiwan-based MOSFET manufacturers Dazhong, Fuding, and Nexen have the fastest chance to increase their quotations in the second quarter, with an increase of 10%-20%. Once these manufacturers start to rise, they will have the opportunity to drive other MOSFET manufacturers to increase their quotations at the same time. Holtek, a major MCU manufacturer, has also issued a notice to customers that it will increase the prices of all chip products in April this year by 15%.
CITIC Securities pointed out that this round of tight supply and demand, on the one hand, due to the fact that most of the fabs reduced their expectations for capacity utilization during the epidemic, resulting in insufficient capacity additions on the supply side, on the other hand, the demand side has recovered strongly, and mobile phones have been upgraded to 5G, fast charging and other features. , demand for computer graphics cards, mining machine chips, Display panels, photovoltaics, and new energy vehicles is strong.
According to industry research, the current chip gap of mobile phone and personal computer manufacturers is about 15%-20%, and the delivery time of semiconductor equipment has reached 6-9 months, some equipment needs more than 1 year, and the recent expansion of the fab needs at least The production capacity will be formed in one year, and the shortage may extend to the end of 2021 to 2022.
Among the A-share companies, CR Micro is the main domestic company with the R&D and manufacturing capabilities of all mainstream MOSFET device structures, covering -100V-1500V. The company is also the MOSFET manufacturer with the largest operating income and the most complete product series in China. Among the MCU targets, the MCU companies in the first echelon in China are mainly Zhaoyi Innovation and Zhongying Electronics.
The price increase of copper clad laminates may release the profitability of enterprises
In addition to the above-mentioned price increase categories, it can be traced back to copper clad laminate (CCL), an important raw material of PCB, and there has also been news of price increases recently. Nanya Electronics, Changxing Materials, Lianmao Electronics, Taiyao Technology and other CCL manufacturers have recently stated that due to the continuous rise in prices of copper and copper foil processing fees, glass fiber cloth and epoxy resin, the three major raw materials of CCL, and the tight supply, the Since April 1, the price of copper clad laminate products has been increased by 15%-20%.
It is worth noting that the market concentration of CCL is relatively high. The total market share of the top ten manufacturers in the world is about 75%, while the total market share of the top ten PCB manufacturers in the world is only 53%. The competition pattern of CCL is excellent. on the PCB.
The historical trend is reviewed, and each round of price increases will drive CCL corporate profits upward. Through tracking and analysis of the price increase process of CCL raw materials in 2016-2017, Zhongtai Securities found that CCL enterprises have strong bargaining power in the industrial chain, and can timely digest cost pressure through price adjustment, while further releasing profit space.
Judging from the previous cycle, the gross profit margins of major companies in the industry have been greatly improved in the short term, increasing the flexibility of profits; while the current round of CCL price increases is the same as the driving factor in 2016-2017. Judging from this, from the perspective of short-term performance, it is expected that Major companies are expected to usher in the release of performance, the industry’s prosperity will continue to rise in the first half of 2021, and there will be ample growth momentum throughout the year.
Minsheng Securities recommends paying attention to Jinan Guoji and Kingboard laminates with low customer concentration and layout of upstream raw materials, as well as mainland high-quality CCL companies Shengyi Technology, Huazheng New Materials and Nanya New Materials.