(Report Producer/Author: Caixin Securities, Zhang Kan)
1 Investment Analysis
According to WSTS data, the global storage market size will be US$158.2 billion in 2021, accounting for 28.61% of the semiconductor market share, and is an important component of the global semiconductor industry. part. In contrast, the domestic storage industry is relatively weak and its global share is not high. In 2020, the localization rate of mainland China's memory will be 1%. Based on the six major domestic memory listed companies, the storage sector has accelerated growth in the past five years, with total revenue increasing from 3.406 billion yuan in 2017 to 18.887 billion yuan in 2021, with a CAGR of 53.45%; the total net profit attributable to the parent company increased from 4.12 billion yuan in 2017 billion increased to 4.217 billion yuan in 2021, with a CAGR of 78.87%. GigaDevice , Beijing Junzheng and Juchen Technology are globally competitive in the fields of NOR Flash, automotive DRAM and EEPROM respectively. We select the highly competitive NOR Flash industry in China, learn from its rise path, and analyze the current layout of domestic Fabless storage companies and the possibility of advancement in the niche storage industry.
Sudden changes in the supply and demand relationship in the industry have led to the reallocation of resources by participating companies, while product technology iterations have weakened entry barriers. As the storage industry, dominated by IDM, faces the end of its product life cycle, its capital expenditure plans are becoming increasingly cautious. When facing external shocks, resource constraints will force it to abandon low-end production lines or even completely abandon the market. Product standardization and weakened technology iterations have lowered entry barriers, which will give new companies room to fill their niche. Domestic enterprises have entered the market through cost advantages and market opportunities, and gradually formed a substitution from low to high. By seizing the opportunities of SPI NOR penetration rate and consumer electronics, GigaDevice has completed the rapid increase in capacity and unit price and ranked among the top three in the industry; Puran Technology has taken advantage of the cost advantage of SONOS process and the growth of small and medium-sized capacity demand. Shipment volume exceeded 2.6 billion pieces. The new demand for
provides space to match the advantages of domestic enterprises, while the increase in the self-sufficiency rate of domestic wafer and foundry production capacity provides production capacity guarantee. The rapid growth of the Internet of Things and wearable devices has provided new space for the industry, and the downstream demand for small and medium-sized capacity is more in line with the competitive advantages of domestic companies. The increase in the self-sufficiency rate of domestic wafer foundry production capacity provides Fabless companies with production capacity guarantee. But at the same time, it brings about the dispersion of industry concentration to a certain extent. The changes in the DDR3 market are similar to the changes in NOR Flash in 2016-2017, and domestic companies are expected to copy this path to achieve industrial advancement. 1) The boom in the semiconductor industry has led to the reallocation of limited resources. The withdrawal of leading manufacturers and Samsung has released more than 30% of the industry's share; 2) Small and medium-capacity DDR3 products still have strong demand in the consumer electronics field, and they do not require high-end automotive electronics industry industry certification barriers and price sensitivity to costs, which is in line with the growth logic of domestic companies penetrating from low-end to high-end; 3) In recent years, the increasing maturity of technology in domestic wafer foundry companies has provided production capacity support. Due to the capital expenditure constraints of Taiwan-based IDM companies, domestic Fabless companies have the upper hand in the competition for share; 4) The domestic model of using advanced processes to produce niche products will constitute a cost advantage.
SLC NAND also faces domestic substitution opportunities, and domestic companies are expected to gain share. Overseas companies are gradually turning to the industrial control and automotive fields, and are gradually withdrawing from the low- and medium-capacity NAND market below 4Gb. The main players of SLC NAND are gradually turning to domestic mainland and Taiwanese companies. With the expansion of emerging application scenarios such as communications, automotive electronics, Internet of Things, wearable devices and industrial control, the demand in the downstream market for small and medium-capacity memory chips with high reliability, low power consumption and other characteristics has also continued to rise, which has also brought about domestic enterprises Domestic substitution opportunities.
Based on the advancement path of the domestic NOR Flash industry after 2016, we focus on two stages and three indicators: The first stage is the redistribution of the leading exit shares, and the core indicators are the multiple expansion of shipments and product numbers and numbers. Accelerated coverage of capacity; the second stage is profit release. In a certain period, supply and demand are reversed due to supply shocks or new incremental demands. Based on capacity and sales, a large amount of profits are captured through price increases.
2 NOR Flash basic characteristics and competitive landscape
NOR Flash market is small and tends to be niche industries. In the non-volatile storage industry, because NOR Flash has a greater disadvantage compared to NAND in terms of capacity cost, it is almost not cost-effective above 1Gb, and the market size is relatively small. According to SEMI data, the market size of NOR Flash and EEPROM in 2021 is approximately US$4 billion, while the global market size of NAND Flash is approximately US$63.6 billion, and the market size of DRAM is approximately US$87 billion. NOR Flash and EEPROM account for approximately 2.6% of the storage industry. The degree of product standardization is high and technological progress is not obvious. The storage industry has a high degree of commercialization. At the same time, NOR 1Gb and above are affected by NAND substitution, and its capacity increase path is blocked. The overall technological progress of the industry is not obvious. Taking product diversity and process iteration as a measure, Macronix, the current leading NOR Flash company, proposed a 48nm development plan in 2015. Since then, the plan has been extended to 2021 before changing to 45nm and sending samples to customers. At the same time, there has been almost no development in recent years. Include NOR Flash in R&D investment. In terms of process proportion, the proportion of Macronix 55nm process has increased from about 5% in 2017 to 62% in 2022Q1. Compared with the logic node, its penetration rate is not fast. Similarly, after GigaDevice launched large-scale sales of 65nm node products in 2013, The focus turned to capacity improvement, and a series of products were launched on 55nm only in 2019. The advantages of mid-to-high-capacity products are not based on cost and volume, which will not affect the rapid increase in manufacturers' shipments.
Participating companies use adjustment of business structure as the main means, and some strategically withdraw from the market. With Samsung withdrawing from the industry in 2010 and the merger of Cypress and Spansion at the end of 2014, NOR Flash suppliers mainly include Cypress, Macronix, Micron , Winbond and GigaDevice. Among them, Cypress significantly reduced the scale of its business in consumer electronics after being merged by Infineon , focusing on the automotive and communications fields; Micron also reduced the scale of related businesses again due to losses after acquiring Hengyi; existing Macronix and Huawei Bangdian is focused on adjusting the NOR business structure, increasing the proportion of high-capacity product business, and tilting the business to industrial control/automotive/communications and other fields, while new capital expenditures are mainly invested in DRAM and NAND.
The market concentration of rises and falls cyclically with mergers, acquisitions and exits, and the dispersion will intensify in 2020. Affected by the gradual replacement of feature phones by smartphones, the NOR Flash market size dropped to less than US$2 billion from 2009 to 2016. Major storage manufacturers successively announced their withdrawal or reduction of business. During this stage, the share of CR5 gradually declined; The demand for capacity-based consumer electronics and Internet of Things equipment is increasing, and there are many new players entering the market. The market dispersion will increase in 2020. The share of the company with the largest market share dropped from 32% in 2010 to 25% in 2020, and CR5’s share dropped from 92% in 2017 to 78% in 2020. Looking back at the entire process, the core changes in the industry's competitive landscape are related to changes in industry outlook expectations and adjustments to leading strategies. The changes in dispersion in 2020 are related to the rapid rise of domestic companies.
3 Old path: Advanced review of the domestic NOR Flash industry
Taking advantage of cost and technology advantages, domestic companies have increased their participation. We use listed/planned listed companies as the research set ( Gigabit Innovation /Puran Shares/Dongxin Shares/Hengshuo Semiconductor/ Core World ) to review the past growth paths of leading and emerging companies in mainland my country. 3.1 Leveraging the power of consumer electronics, GigaDevice has gradually grown into the top three companies in the industry. From volume increase to price increase, GigaDevice NOR has experienced three stages of growth. According to the company's average price and sales changes, the company's development history can be divided into three stages:
1) From 2014 to 2016, the company's memory chip sales increased from 1.108 billion to 1.686 billion, with a compound growth rate of 23.36%. The main benefits Due to the increase in share and the increase in demand for multi-wafer packaging of mobile phone memory chips, the change in single ASP is relatively small due to competition and pricing strategies.
2) From 2017 to 2019, the company's memory chip sales increased from 1.736 billion to 2.875 billion, with a compound growth rate of 28.69%. At this stage, the industry leader strategically exited, and the company's core change was to continue to maintain rapid sales growth while , accelerating the switch from low-capacity to high-capacity products. In 2017, the company's products were concentrated below 128Mb, and then accelerated the launch of 256Mb and above products. By 2019, thanks to the introduction of consumer electronics customers and the explosion of wearable devices, GigaDevice's shipments increased 45.57% year-on-year to 2.875 billion units, basically tying the shipment data of Macronix and Winbond. At the same time, from the description in the annual report, its product launch speed has been significantly accelerated.
3) From 2019 to 2021, GigaDevice’s shipments of innovative memory chips (mainly NOR Flash, only NOR products are considered here) increased from 2.875 billion to 3.288 billion, ranking second in the world, second only to Winbond. 3.793 billion pieces, but the compound growth rate dropped to 6.94%. The main revenue growth comes from changes in price. The average price of memory chips increased from 0.79 yuan in 2019 to 1.66 yuan in 2021, gradually approaching Winbond's NOR Flash average price of 1.92 yuan, lagging behind Macronix's 2.84 yuan (due to Macronix It is strongly tied to the Japanese game console industry, with the largest customer accounting for more than 40%, which has certain special characteristics).
Driven by price increases, the company's gross profit margin has steadily increased. Before 2020, the company's microcontroller business accounted for a relatively small proportion (between 15% and 20%), and its gross profit margin was relatively stable (between 43% and 47%). The main influencing factor on its operating profit was memory chips. . We examined the changes in the gross profit margin of sales of the company's memory segment. After Micron/ Cypress successively announced the withdrawal of low-end products, benefiting from the improvement of the competitive landscape and price increases in 2017, the company's gross profit margin rose from below 25% to 37.61% and basically maintained at this level. In the new round of prosperity in 2021, the company will further increase the gross profit margin to 39.71% through product adjustments and price increases. After
completed its technology accumulation, it further expanded its share in the industrial control and automotive fields. The company's full range of GD25/55 and GD5F products have passed AEC-Q100 automotive grade certification, achieving a comprehensive layout of automotive grade products from SPI NOR to SPI NAND. At present, the company's automotive-grade Flash products have been adopted in batches by many well-known domestic and foreign automobile companies, and can provide large-capacity, high-reliability, and high-performance products and solutions for automotive applications. (Report source: Future Think Tank)
3.2 Emerging companies are all established together, mainly undertaking medium and low-capacity products
currently listed/planned to be listed companies Puran Shares/Xintianxia/Hengshuo Shares and unlisted Zhuhai Boya/Douqi Technology, etc. They were all established between 2014 and 2016. Their main capacity covers products below 256Mb. The compound growth rate of each enterprise exceeds the industry average.
As major NOR participants continue to compress the scale of low-capacity business, the rapid growth of products including IoT devices, TWS headsets, AMOLED, TDDI and other products has created strong demand for small and medium-sized capacity. The capacity of these application products ranges from 4Mb to 128Mb. Conducive to the participation of small and medium-sized enterprises. According to Puran’s prospectus, TWS Bluetooth headsets are expected to bring a new market for NOR Flash of US$300 million, the AMOLED screen market is expected to bring a new market for NOR Flash of US$100 million, and the growth of TDDI is expected to bring a new market for NOR Flash. market growth of RMB 500 million. The representative company Puran Co., Ltd. has used its technological advantages and low-price strategy to achieve sales of 2.759 billion units in 2021, and revenue reaching the 1 billion level. From the perspective of profitability and value, emerging companies with large revenue scale are concentrated in the field of consumer electronics, and their capacities are concentrated at 128Mb and below.
After 2016, domestic product capacity/process advancement will accelerate, and it will gradually have unique advantages in cost/technology. Judging from the evolution of technology, the NOR Flash product upgrade route is relatively clear. New products will be steadily launched around more advanced processes/higher capacities, and R&D - tape-out - mass production - sales will be achieved. With Micron and Cypress announcing their withdrawal from NOR low-capacity in 2016 and 2017, and tilting resources towards more cost-effective NAND in the direction of non-volatile storage, the domestic industry began to enter the fast lane.Emerging companies have been established one after another, and the leading Gigabyte innovative has also significantly accelerated the launch rate of product . In 2017, 256Mb products were mass-produced, and by 2020, the GD25, which represents the highest level of the SPI NOR Flash industry, with a capacity of up to 2Gb and high performance, will be launched. /GD55 B/T/X series products, the product competitiveness is basically approaching the international mainstream level on an annual basis.
is different from the three giants that mainly focus on medium and high capacity. Since the competition in the medium and low capacity market is relatively fierce, and most of the downstream products are Internet of Things and consumer electronics equipment, participating manufacturers often upgrade their processes to meet the downstream demand for cost and volume. Most companies' processes The node has reached below 55nm, which is basically the same as or even lower than GigaDevice/Winbond/Macronix, etc., and it also shows a stronger willingness to upgrade the process. In addition, some participating manufacturers have gradually developed special technical routes. For example, the SONOS process authorized by Puran Semiconductor can reduce the number of necessary masks and processing steps, and reduce the overall size and area of the chip; SONOS is not susceptible to drain conduction and floating gate interference, and is resistant to stress-induced leakage current (SILC). ) is insensitive, can achieve faster programming and lower write/erase voltage, and upgrade the process node to 40nm to achieve competitiveness in low and medium capacities.
3.3 Summary: The typical path for the advancement of the domestic NOR Flash industry
NOR Flash industry—a typical path for realizing domestic substitution from the bottom up. Here we define domestic substitution more broadly, that is, the process by which domestic enterprises shift from domestic market substitution to participating in global competition. From the path, we can classify the process as follows: industry boom - resource constraints of overseas manufacturers - overseas manufacturers transfer market - entry of domestic enterprises - rapid expansion of scale - R&D/equipment reinvestment - technology approach - participation in mainstream competition. Its potential constraints and favorable conditions include:
1) The supply and demand relationship in the industry changes suddenly, and the main participating companies strategically abandon part of the low-capacity market under resource constraints, or even completely withdraw from the industry. The main participants in the storage industry are mainly IDMs. As the industry enters the end of its life cycle, its capital expenditure plans become increasingly cautious. In the face of external shocks, resource constraints will force it to abandon the low-end market, which will give There is room for new businesses to fill the gap. During 2016-2017, Micron switched its NOR production line to NAND, and Cypress sold its 12-inch wafer fab in Bloomington, further reducing its production capacity.
2) Domestic companies enter the market through cost advantages and market opportunities. According to the company's investor relations activity record sheet, GigaDevice's central node was approximately 64Mb in the initial stage of listing. Later, with the help of SPI NOR Flash's application in the low-power field, its shipments and central nodes increased rapidly, quickly becoming the SPI in the Chinese market. NOR Flash ranks first in market share; Puran Technology relies on the cost advantage of SONOS technology in 64Mb, and its shipments have grown rapidly to 2.759 billion units in 2021.
3) Provide space for new demand, matching the advantages of domestic enterprises. After mobile phones are replaced by NAND, the main increase in the NOR Flash market is OLED/Internet of Things/wearable devices, with specifications and capacities concentrated in 8-128Mb, which is the main growth area for domestic enterprises. Provide room for revenue growth.
4) After completing the accumulation of technology, it leverages its price and cost advantages to impact high-end products. Due to the similarity in NOR Flash structure, the peripheral control circuit determines the chip's control algorithm , and the memory unit affects basic parameters such as the chip's unit area and operating voltage. After domestic chip design companies have accumulated profits and technology on small-capacity NOR products, they have achieved lower prices on high-capacity products by optimizing circuit drivers and combining manufacturing and reliability-oriented chip design technology and production processes to improve yields. With cost advantage, the product asp is close to that of foreign enterprises.
4 New opportunities: Niche market DDR3 and SLC NAND bring new space
4.1 DDR3: The current stage is expected to reproduce the growth path of NOR Flash
DDR3 The market size has stabilized and gradually shifted to the niche market. The scale is expected to be approximately US$7.5 billion in 2021. . As DDR4's replacement of DDR3 in the mainstream market comes to an end, DDR3's share of the overall DRAM scale has gradually stabilized. Its market is expected to account for 8% of the DRAM market in 2021, with a scale of approximately US$7.535 billion, and is expected to grow to US$8.4 billion by 2022. Dollar.Among the participants in the low- and medium-capacity niche DDR3 market, Samsung and Micron will still retain DDR3 production capacity in 2021. Nanya, a major Taiwanese niche DRAM manufacturer, accounts for about 30% of DDR3, and the three together account for more than 80% of the market share. , the revenue scale of other manufacturers is roughly the same (200-300 million US dollars). In terms of product structure, Samsung has stopped investing in DDR3 and only has about 75 1/2/4 Gb products. Micron has a complete 1-8Gb product line but only 51 models. Nanya is deeply involved in products with capacities below 4 Gb. The line is relatively rich, with as many as 135 models.
The withdrawal of leading manufacturer Samsung will unlock industry opportunities, and the industry is facing a key node of share reshuffle. In terms of time points, 2022-2023 will become an important year for the redistribution of DDR3 market share. On the one hand, Samsung and others on the supply side will no longer receive new orders after the second half of 2022. Most of the installation and mass production time nodes of IDM Taiwan factories will be after 2023. , while downstream demand such as communications, automobiles, security monitoring and industrial demand are relatively stable, which will provide opportunities for domestic Fabless companies to expand their market share.
DDR3 still has strong vitality in some market segments. Although DDR4 is the current mainstream choice in the server/PC field and is gradually iterating to DDR5, DDR3 is still widely used in fields such as equipment/communications/IoT devices with long operating cycles and need to be compatible with old memory technologies, such as those used in the Internet of Things. If the development board and expansion board are not updated, compatible DDR3 products will continue to be used. Currently, security monitoring, gateway routers, WiFi and set-top boxes can all use DDR3 memory ranging from 1Gb to 4Gb. The process technology is relatively concentrated compared to , and has potential cost advantages in China. Among the major manufacturers in the niche DDR3 market, Winbond focuses on expanding 25nm process technology and researching and developing the next generation; Jinghao Technology will initially complete 25nm development and enter mass production in 2021; Nanya Technology completed 20nm DDR3 certification and production in 2017 Mass production work. Domestic enterprise GigaDevice relies on Hefei Changxin to produce 17nm DDR3, while Beijing Ingenics (ISSI) and Dongxin Co., Ltd. both use 25nm. The overall DDR3 preparation process is relatively concentrated, and GigaDevice has a process lead.
The current DDR3 changes are similar to the NOR Flash changes in 2016-2017, and domestic companies are in a more advantageous position. Looking back on the development history of NOR Flash, as Cypress and Micron, which ranked first and third in market share respectively, successively announced their withdrawal from small and medium-capacity NOR, the shipment growth rates of Macronix and Winbond in 2016-2017 were respectively 16.73%/40.34% and 15.86%/28.01% became the biggest winners in this round of industry clearing. In 2018, the market share quickly rose to the top two. As , SMIC, and Hua Hong Semiconductor Technology catch up, domestic companies catch up, with growth rates higher than the industry average. We believe that the current DDR3 opportunities are similar to NOR Flash in 2016-2017, and domestic companies have certain advantages in the competition for share. The reasons are: 1) The boom in the semiconductor industry has led to the reallocation of limited resources, and the withdrawal of the leading manufacturer Samsung has released more than 30% of the industry. % share; 2) Small and medium-capacity DDR3 products still have strong demand in the consumer electronics field. They do not require higher industry certification barriers in the automotive electronics industry. At the same time, they are price sensitive to costs, which is in line with the penetration of domestic enterprises from low-end to high-end. Growth logic; 3) In recent years, the increasing technological maturity of domestic foundry companies has provided production capacity support. Compared with the capital expenditure constraints of Taiwanese IDM companies, domestic Fabless companies have an advantage in the competition for share; 4) Domestic utilization of advanced technology The process-based production of niche products will constitute a cost advantage.
Based on the advanced path of the domestic NOR Flash industry after 2016, we focus on two stages and three indicators: The first stage is the distribution of the leading exit share, and the core indicators are the multiple expansion of shipments and product material numbers and Accelerated coverage of capacity; the second stage is profit release. In a certain period, supply and demand are reversed due to supply shocks or new incremental demands. Based on capacity and sales, a large amount of profits are captured through price increases.
4.2 SLC NAND: Domestic companies are aggressive
SLC NAND has a niche position in the high-reliability market. According to the number of bits that each NAND flash memory cell can store, NAND flash memory can be divided into SLC/MLC/TLC and QLC.In pursuit of higher density and lower cost, TLC occupies a larger market share among mainstream market products, and some have begun to use QLC particles with larger capacity. Correspondingly, the larger the capacity, the lower its durability and the fewer times it can be erased and written. Even with the help of increasingly developed controller and firmware technology, MLC/TLC products are not suitable for high-end applications such as industrial control. The reliability market is mainly reflected in three aspects: 1) The more storage units, the more precise and complex algorithms the circuit needs to distribute charges, resulting in slower reading and writing speeds; 2) In Copyback/Partial programming, MLC/TLC has /Write/modify or small block operations perform worse; 3) The more storage units, the fewer times it can be erased and written, which is not suitable for scenarios where frequent updates or reliability are pursued. Therefore, in the field of small-capacity NAND, serial port SPI NAND provides a code and data storage solution for the past use of NOR Flash, which requires high reliability/small packaging and requires a capacity of more than 1GB; while parallel port PPI SLC NAND products Suitable for high bandwidth applications.
Relying on the expansion of high-reliability market and emerging scenario applications, the SLC market has grown steadily. According to Gartner data, the global SLC NAND market size was approximately US$1.671 billion in 2019 and is expected to grow to US$2.324 billion by 2024, with a compound growth rate of 6%. With the expansion of emerging application scenarios such as communications, automotive electronics, Internet of Things, wearable devices and industrial control, the downstream market's demand for small and medium-capacity memory chips with high reliability, low power consumption and other characteristics continues to rise. Including communication applications such as 5G base stations/CPE, PON, routers and set-top boxes, Internet of Things applications such as security monitoring, smart homes and automotive electronics, etc., support the market demand for SLC NAND.
At present, the main participants in the SLC NAND niche market include foreign Samsung, SK Hynix , Micron and Kioxia. Taiwanese companies in my country mainly include Macronix, Winbond and Jinghao Technology, etc., and domestically GigaDevice. , Beijing Junzheng, Dongxin Co., Ltd. and Xintianxia, etc. As overseas companies gradually shift to the industrial control and automotive fields and gradually withdraw from the mid- and low-capacity NAND market below 4Gb, the main players of SLC NAND gradually turn to domestic mainland and Taiwanese companies. From a technical level, Macronix 19nm SLC NAND has been successfully shipped and accounted for 59% of the bits in 2021Q4. The remaining manufacturers are concentrated in 24nm and 38nm. Dongxin's SLC NAND mass-produced products are mainly SMIC 38nm, and are actively Some electronic 28nm products have been put into mass production, SMIC's 24nm products have reached mass production standards, and products based on SMIC's 19nm process node have entered the research and development stage. (Report source: Future Think Tank)
5 New layout: Domestic enterprise niche market product strategy
5.1 GigaDevice Innovation: From NOR to MCU to DRAM
Focusing on the advantages of cost and domestic substitution, GigaDevice Innovation has realized the dual wheel from NOR to MCU Drive strategy. The company's performance and stock price since its listing can be roughly divided into two stages: growth driven by the rapid development of NOR Flash from 2017 to 2019, and market value increase brought about by the NOR boom and the rapid growth of MCU from 2020 to 2022. It can be seen from the path that the company's NOR product focused on sales volume over price in the initial stage, achieving rapid improvements in shipment volume/product capacity/product material numbers, and achieved profit growth with the help of two industry booms. Based on the initial investment in R&D and the pin-to-pin replacement of STM32, MCU products have further enriched the diversity of main frequency, memory, and peripheral pins, forming 32 series with more than 400 products. , its shipments have grown rapidly from 109 million units in 2019 to 394 million units in 2021, with a compound growth rate of 90.12% in the past two years.
DRAM has shifted from consignment sales to self-developed products, using its process advantages to enter the niche DRAM market. The company announced daily related transactions in 2022 in December 2021. It is expected to sell US$170 million of Changxin storage DRAM products in 2022, which is equivalent to the transaction volume in the same period last year; it is expected that its own brand procurement and OEM sales will be US$135 million, compared with 1-1 last year. The total purchase amount in November was US$30 million. Company information shows that the first 19nm 4Gb DDR4 product has been mass-produced in 2021, which is widely used in consumer electronics (including set-top boxes, TVs, smart homes, etc.), industrial security and network communications and other fields.The company's 17nm DDR3 products are currently progressing as planned and are expected to start contributing revenue in 2022. According to the product material number data in the official website information, the company mainly enters the mass supply (MP) stage of DDR4 4Gb products, with rates covering 2400Mbps-3200Mbps; DDR3 material number numbers are relatively small and are all in the sample stage, mainly concentrated in 4Gb and 2Gb There are a total of 8 commercial and 12 industrial products, with speeds ranging from 1866Mbps to 2133Mbps and voltage parameters of 1.35/1.5V. At present, with the withdrawal of Samsung, the mainstream DDR3 process is 25nm, and Nanya Technology is relatively leading. GigaDevice will have a technological advantage by relying on Hefei Changxin to produce 17nm DDR3.
5.2 Beijing Junzheng: Using ISSI to enter the automotive market
By acquiring ISSI, the company quickly acquired a complete automotive-grade storage product line, avoiding the long development and certification process required to enter this segment, and at the same time brought Analog and interconnect chip products. According to Omdia statistics, ISSI SRAM, DRAM, and Nor Flash product revenue ranked second, seventh, and sixth respectively in the global market in 2021, ranking at the forefront of the international market. According to the company's 2021 annual report, Beijing Silicon Technology (ISSI) achieved revenue of 4.083 billion yuan, accounting for 77.42% of the company's revenue, and net profit of 608 million yuan, accounting for 65.66% of the profit. In terms of products, DRAM revenue accounted for 62% from January to May 2019, followed by SRAM at 19%; in terms of downstream application fields, automotive and industrial accounted for the main shares, 39% and 31% respectively; consumer electronics accounted for Small, only 16%.
According to the product selection manual published on the official website, ISSI covers a total of 6 categories: RLDRAM, DRAM, LPDRAM, NOR Flash, MCP and SRAM. Among them, DRAM, the main source of revenue, includes SDR, DDR, DDR2, DDR3 and DDR4. Among them, DDR4 products are mainly large-capacity above 4Gb, with 5 subcategories each for automotive specifications (IS46) and non-automotive specifications (IS43); DDR3 is the company's main product The product capacity covers 1-16Gb, and the voltage is divided into 1.35V and 1.5V categories, totaling 29 subcategories each for automotive specifications (IS46) and non-automotive specifications (IS43). It also includes 1.8V DDR2, 2.5V DDR SDRAM and 3.3VSDRAM.
process migration improves competitiveness and accelerates product expansion. The company's current main product DDR3 process is 25nm, which is equivalent to the mainstream process in the current market, and the process is constantly updated in line with market demand. The company mainly relies on its advantages in non-consumer electronics to gradually expand its product lines. According to the annual report, the company’s 8Gb LPDDR4 products are expected to begin sampling in 2022. The company continues to increase the market promotion of the Flash product line. Under the strong demand from the automotive, industrial, medical and high-end consumer markets, the Flash business has achieved rapid growth year-on-year, and the market sales of automotive-grade Flash products are growing rapidly. The company has completed the production of two Nor Flash chip products for the mass consumer market and launched market promotion. It is expected to achieve mass production and sales in 2022.
5.3 Dongxin Co., Ltd.: Mainly SLC NAND, taking into account DRAM and NOR Flash
The company focused on the design and development of planar SLC NAND Flash in the early days. Currently, based on the SMIC 24nm process platform, it has achieved full coverage of the design and development of 1Gb to 32Gb series products. And in 2021, the first tape-out of SLC NAND will be completed based on 19nm. The company later strengthened its technical reserves in DRAM, NOR and MCP products through the acquisition of South Korea's Fidelix. At present, the products sold by the company are mainly niche SLC NAND, the NOR series products are mainly targeted at the consumer market, and the DRAM products are mainly small and medium-capacity DRAM targeted at the niche market. According to the company's 2021 annual report, the company's NAND series products achieved revenue of 660 million yuan, accounting for 58.16% of business revenue, and NOR/DRAM/MCP revenue accounted for 16.53%/6.97%/15.72% respectively. According to the product data on the company's official website, SPI/PPI NAND product series is rich. SPI NAND includes 512Mb~4Gb capacity, can provide two voltages of 3.3V/1.8V, and has various packaging forms of WSON and BGA; PPI NAND includes 1Gb~8Gb Capacity, 3.3V/1.8V two voltages, products with multiple packaging methods to meet different application scenarios. The company's products are widely used in network communications, smart speakers, security monitoring, set-top boxes and other fields.
accelerates process catch-up and improves cost advantage.According to the prospectus, Dongxin's SLC NAND has mass-produced 38nm/28nm, SMIC's 24nm products have reached mass production standards, and products based on SMIC's 19nm process node have entered the research and development stage. The 24nm NAND and 48nm NOR designed, developed and mass-produced by the company are currently the leading processes in mainland China. The company has also increased the development of automotive-grade products. The 38nm process can provide customers with automotive-grade PPI NAND and SPI NAND samples, with capacities ranging from 1G to 8G automotive-grade NAND Flash. Currently under development are 48nm medium and high-capacity NOR Flash automotive-grade products.
5.4 Summary: The niche market has great potential
We summarized the three companies from multiple perspectives such as revenue scale, main business structure, sales volume scale, mass production process, foundry and product portfolio, and gave a more intuitive response to the three companies. differences in business layout. In terms of
business layout, GigaDevice is the world's leading NOR Flash supplier and has gradually expanded into the DRAM business, including DDR3 and DDR4; Beijing Junzheng has acquired a relatively complete DRAM production line through the acquisition of ISSI, covering automotive and non-automotive specifications. level; Dongxin Co., Ltd. mainly focuses on SLC NAND products, and has gradually added NOR and DRAM; in terms of process and foundry distribution, new entrants are more receptive to new technologies, including the processes used by Ingenics and Dongxin's NOR They are 50/48nm respectively, and GigaDevice also adopts 17nm process to produce DDR3. The process level of domestic enterprises is not much different from the mainstream of the industry. SMIC is one of the important foundries in the domestic storage industry. Except for Beijing Ingenics, whose suppliers are relatively dispersed, the other two are concentrated in 2-3 wafer foundries. Each company's main production capacity relies on local wafer foundries. , the overall dependence on foundries in Taiwan is decreasing.
(This article is for reference only and does not represent any investment advice on our part. If you need to use relevant information, please refer to the original text of the report.)
Selected report source: [Future Think Tank]. Future Think Tank - Official website
