Semiconductor industry performance differentiation in the first half of the year, multiple equipment companies expect a significant increase in net profit

39 semiconductor listed companies on the A-share market have disclosed their 2023 interim performance forecasts. Among them, 30 companies are expected to make profits, 9 are expected to incur losses, and the proportion of companies with expected profits exceeds 70%. Specifically, 8 companies are expected to see an increase in performance, 21 are expected to see a decrease, 8 will experience their first loss, 1 will turn a loss, and 1 will see an increase in losses.

The main business of companies with expected year-on-year increase in net profit is mostly semiconductor equipment. Several equipment companies expect a significant increase in net profit, for example, Zhongwei Company expects a year-on-year increase of 109.49% -120.18% in net profit attributable to shareholders in the first half of the year. The company stated that the market share of its key customers for etching equipment continued to increase during the reporting period. In addition, Wanye Enterprise expects its net profit attributable to the parent company to increase by about 316% year-on-year in the first half of the year, and its equipment manufacturing business revenue to increase by about 18% year-on-year.

Li Keyi, Chief Expert of Yuanhe Semiconductor Technology Co., Ltd., told Securities Daily reporters that there is still a demand gap in key areas such as semiconductor equipment and materials, and related listed companies are expected to continue to benefit. Most listed companies with relatively mature core technologies and innovation capabilities have dominant advantages in the industry chain and strong risk resistance capabilities. In the long run, semiconductor companies still need to master core technologies to enhance their voice.

The listed companies with expected net profit reduction are mainly focused on SoC chip research and development, IC design (integrated circuit design), packaging and testing, and most of their cutting-edge technology project development and research are in the early stage of investment.

Leaders in segmented industries such as Zhaoyi Innovation and Shanghai Beiling are expected to see a net profit decline of over 50% in the first half of the year. The lower than expected demand in the consumer electronics market and the pressure on product sales prices have become important factors affecting company performance. Semiconductor packaging and testing leader Huatian Technology expects a net profit decline of 86.38% -90.27% in the first half of the year. The company stated that the demand for end market products has decreased during the reporting period, and the company's orders are not full.

Song Jia, director of the Integration and Collaborative Innovation Center of the Machinery Industry Economic Management Research Institute, said in an interview with Securities Daily, "Due to the fact that the consumer electronics industry still needs to recover, the performance of semiconductor companies may continue to be under pressure in the second half of this year. However, with the sudden breakthrough of processes and the continued enthusiasm for capital, we still have a positive outlook on the industrial chain development and investment opportunities brought by the localization process of semiconductor equipment in the long run

"In the past year, the global semiconductor market experienced a cyclical decline. At present, the terminal market has not fully recovered, and the inflection point of the semiconductor industry may be delayed to next year. However, with the gradual release of the inventory pressure of semiconductor enterprises and the recovery of demand, market confidence will continue to improve." Guo Tao, an angel investor and well-known Internet expert, believes.

At the same time, the localization process of various links in China's semiconductor industry chain is also accelerating, and equipment enterprises are maintaining countercyclical high-speed growth.

Currently, there are huge opportunities for localization in multiple sub sectors of the semiconductor industry. At the same time, applications such as large models and autonomous driving are accelerating their large-scale implementation, which will also drive the semiconductor industry to enter a high-speed growth stage in the coming years. Driven by artificial intelligence technology, digital chips, semiconductor equipment, and packaging and testing have become important directions for institutions to increase their holdings, and market investment activity has increased, "said Chen Jia, a researcher at the Institute of International Monetary Studies at Renmin University of China.

In this context, listed companies in the semiconductor industry chain that seize development opportunities are expected to continue to benefit.

An Guangyong, an expert from the Credit Management Committee of the All Union Mergers and Acquisitions Association, suggested that relevant listed companies should achieve diversification of their supply chains, increase investment in research and development of new technologies, and establish effective management mechanisms for cost control. Relevant departments should also continue to provide policy support and financial guidance to provide a favorable development environment for listed companies. Source: Securities Daily