Recently, China exportsemi net learned that CICC released a securities research report "Semiconductors and Components 2024 Outlook" and shared its research results. Through securities market data analysis, it was concluded that AI and the main line of cyclical recovery resonate, and production factors It’s time to increase the localization rate.
In this issue, China exportsemi net brings you the first half of the report. A review and summary of the semiconductor industry in 2023. As the saying goes, "review the past and learn the new", let us take a look at the domestic and global semiconductor industry in 2023. What's the result?
Semiconductors and components 202 3 -year summary
From the beginning of 2023 to December 22, 2023, the electronics sector rose by a cumulative 3.4%, ranking first among the 31 Shenwan first-level industries. Among the semiconductor and component-related sub-industries, the panels, semiconductor packaging and testing, and PCB sectors have led the growth, with increases of 15.9%, 14.2%, and 10.2% respectively since the beginning of 2023. Discrete devices have ranked second, with a cumulative decline of 29.6% since the beginning of 2023. .
Figure 1: Ranking of Shenwan’s primary sectors by rise and fall (YTD)
Figure 2: Ranking of gains and losses of electronics, communications and Shenwan three-tier sectors (YTD)
CICC Securities Research believes that the semiconductor industry will be in the destocking stage in the first half of 2023 , and the prosperity will generally bottom out in the second half of the year . Structural differentiation still exists, consumer electronics will recover moderately, and demand for automotive electronics and AI-related applications will remain Strong, while the industrial and photovoltaic categories are experiencing destocking pressure.
Data shows that the semiconductor secondary market began to bottom out in October 2022, and the semiconductor index (Shenwan Industry Classification) began to fluctuate and rise; in early 2023, AI industry chain-related targets drove the semiconductor sector to significantly outperform the market, and the semiconductor index started to rise from March 16, 2023. It has risen by 14% cumulatively from the highest point on April 7, 2023; the semiconductor sector as a whole has experienced a sharp correction since mid-to-late April 2023. Analysts believe that the main reason is that the performance of some companies in the first and second quarters of 2023 is lower than the recovery market expectations. , at the same time, the AI concept target with high market sentiment in the early stage has significantly corrected; in late October 2023, each manufacturer released its third quarterly report. Benefiting from the recovery of consumer electronics demand and customer replenishment, the chip design sector's third quarter performance increased year-on-year, indicating that the semiconductor industry It is expected to achieve a cycle reversal, with the semiconductor index rising by 4% from October 23, 2023 to December 22, 2023, against the backdrop of a decline in the broader market.
Looking at the semiconductor segment, the packaging and testing sector has led the gains since the beginning design . From the beginning of 2023 to the present, the semiconductor packaging and testing, semiconductor equipment, semiconductor materials, analog chip design, and digital chip design indexes have increased and decreased by +14.2%, +1.1%, -12.2%, -6.4%, and -5.5% respectively. However, if viewed in stages, the semiconductor upstream sector fell after the release of the interim report (2023/9/1-2023/12/11), with analog chip design and digital chip design rising by 4.9% and 4.3% respectively. Analysis believes that the main reasons are:
- In the first half of the year, the continued digestion of downstream inventories made the packaging and testing sector the first to recover from the bottom. At the same time, the equipment sector benefited from the expansion of wafer fabs and the increased certainty of domestic substitution, and the fundamentals maintained a positive trend;
- After the mid-term report, terminal manufacturers have come to the end of the inventory digestion of some categories of chips and have resumed the pace of delivery, which has a significant boost to the performance of chip design manufacturers. At the same time, the latter's own inventory levels have declined. In addition, the prices of some products have bottomed out, driving the market to the design sector. Enthusiasm for investment increases.
At the individual stock level, the A-share semiconductor companies with the highest gains since the beginning of the year are Baiwei Storage (+335.9%), Cambrian (+169.4%) and Haiguang Information (+87.8%). The companies with the largest declines are Acer Micro Technology (+87.8%). -54.4%), Dongwei Semiconductor (-52.1%) and Unisoc Microelectronics (-50.9%). Analysis believes that the main reasons for the high increase are:
- The expansion of AI application scenarios has driven strong growth in HBM demand since the beginning of the year. Storage prices bottomed out in August and September, ushering in another wave of rising storage prices.
- Nvidia chip sales were restricted in October, prompting leading domestic AI chip manufacturers to accelerate substitution.
The P/E of the semiconductor sector (Shenwan) will be at the bottom in the second half of 2022, and the valuation has continued to recover since the beginning of 2023. As of December 22, 2023, the valuation level is 61.1 times, which is close to the median since 2017. level. With terminal demand recovering modestly, downstream customers returning to normal delivery rhythms, capacity utilization returning to a higher level, and product prices stabilizing, analysts believe that the semiconductor industry may be reaching the bottom of the cycle.
Figure 3: Top 10 A-share semiconductor companies with the largest price increases and decreases (YTD)
Figure 4: Quarterly inventory scale and inventory turnover days of the semiconductor design segment (covered by CICC)
The proportion of semiconductor sector fund holdings continued to rise in 3Q23, reaching a record high. Since 4Q18, the proportion of semiconductor holdings and overweight ratio have maintained an upward trend. As of 3Q23, the proportion of A-share full fund semiconductor holdings has reached 7.26%, an increase of 1.75ppt from the end of 2022, significantly higher than the historical average of 2.35%; the overweighting margin has increased to 3.68%.
Figure 5: A-share full fund semiconductor holding ratio and overweight/underweight range
The global semiconductor market is expected to reach US$588.4 billion in 2024, a significant increase from 2023. WSTS raised its global semiconductor revenue forecast in November, predicting that it will reach US$5884/6547/705.2 billion respectively in 2024-2026, with year-on-year growth rates of +13%/+11%/+8% respectively. In terms of regional distribution, WSTS estimates that by 2026, the total semiconductor revenue in the Americas/Europe/Japan/Asia-Pacific regions will be 2,024/694/569/376.6 billion US dollars, respectively, accounting for 29%/10%/8%/ 53%. In terms of application scenarios, WSTS predicts that the market segments of optics/sensors/integrated circuits/discrete devices will be 471/218/5937/42.6 billion US dollars respectively by 2026; among them, WSTS predicts that the integrated circuit market will enter a recession in 2023. After that, it is expected to see a stronger recovery in 2024 and 2025, with year-on-year growth rates of +15%/+13% respectively.
Figure 6 : Total global semiconductor revenue (by region); Figure 7 : Global semiconductor revenue year-on-year growth rate (by region)
Figure 8 : Total global semiconductor revenue (by application scenario); Figure 9 : Global semiconductor revenue year-on-year growth rate (by application scenario)
Looking specifically at the integrated circuit segment, the memory market is expected to achieve rapid growth in the next three years. WSTS estimates that the market size of analog circuits/logic circuits/memory/microprocessors will reach US$841/1,917/1,298/81.9 billion US dollars respectively in 2024, and the market size is expected to reach US$935/2,191/1,908/90.3 billion US dollars respectively by 2026; among which, The memory market is growing the fastest, with a CAGR of 28.7% from 2023 to 2026.
Figure 10 : Total global integrated circuit revenue (by region); Figure 11 : Global integrated circuit revenue year-on-year growth rate (by region)
Figure 12 : Total global integrated circuit revenue (by application scenario); Figure 13 : Global integrated circuit revenue year-on-year growth rate (by application scenario)
This issue briefly reviews the performance of the semiconductor industry in 2023. Starting from the next issue, we will analyze the opportunities and challenges of industry development in 2024 from different segments, so stay tuned. China Overseas Semiconductor Network looks forward to your message. (anahu@ehaitech.com)
Outlook for Semiconductors and Electronic Components in 2024 (1): Industry Review in 2023
Semiconductor and Electronic Components Outlook 2024 (5): Semiconductor Manufacturing Sector
Outlook for Semiconductors and Electronic Components in 2024 (7): Panel/PCB/Component Sector
