According to Lu Xingzhi, head of Semiconductor Research at Barclays Capital Securities in Asia Pacific, the foundry industry will enter a period of "stagnatic recovery." It is estimated that revenue will show zero growth (in Taiwan dollars) for the next year (2012), and excess production capacity will continue. At least 4 seasons or more! The most promising semiconductor sub-group next year is the IC design. The following is an excerpt from his exclusive interview with this newspaper:
Q: How do you look at the fundamentals of the foundry industry?
A: Looking at the just-concluded wafer foundry law, overall, the problem of inventory adjustment is not very serious. I am concerned that the weak demand situation may be worse than expected.
In terms of three major blocks such as PCs, mobile phones and consumer electronics, the inventory levels of mobile phones and consumer electronics are relatively high. Currently, the inventory levels are 2.9 and 2.7 months respectively, which is higher than the average of 2.3 and 2.2 months. The proportion of consumer electronics co-occupying demand exceeds 60%. When inventory de-consummation can be completed, it will be one of the major observations.
In addition, from the demand side, the growth rate of demand for PCs, mobile phones, consumer electronics and other products in 2011 was about 5%, and it is estimated that this will be the case in 2012. Even with smart phones and tablet computers, there is still only 11%. , But the foundry's capacity growth rate in 2011 reached 15% to 20%, plus 15% to 20% of the process miniaturization variable, which equals the capacity growth rate of 25% to 30%, which is equal to the gap between the wafer foundry industry supply and demand Up to 14 to 19 percentage points.
Assuming that the foundry's average capacity utilization rate reached 100% in the second quarter, it means that the capacity utilization rate in the next four quarters will have to drop to 83% to balance the supply and demand of the industry, and the growth rate of the revenue will continue in 2011. After falling (about 5% or less), it will be flat in 2012 and enter the so-called "stagnatic recovery" period.
Q: Do you mean that the wage generation wages on wafers are not enough?
A: From my point of view, I'm really not satisfied, but this is a last resort result because everyone must grab the 28-nanometer market. Even if you want to lower your capital expenditure, the rate will not be too big. Therefore, the next important thing to observe is that Yes, how long will the excess production capacity last? This is a structural issue. I think at least four quarters, the utilization rate of the next few quarters will not return to the peak of 100%.
Then the industry trend may become, manufacturers are unwilling to reduce capital expenditures, inventory is not easy to drop, resulting in the industry cycle in the past, the volatility will become quite slow, but also due to the lack of large-band market, the stock price is difficult Good performance.
Q: What are the more respectable ethnic groups next year?
A: I strongly recommend buying IC design groups, especially those who can grab low-priced ($100) smart phone market in emerging markets. There are at least seven reasons to support this view:
1. The gross profit margin of the semiconductor industry is relatively stable during the downturn of the economy; 2. More concessionary prices for OEMs are available at the current stage; 3. The recent active transition into the mobile device industry with higher gross margins; 4. The proportion of emerging markets is high; The high cash position can respond to the government's call for companies to buy back stocks and treasury stocks; VI. Lack of foreign capital to care for eyes; and 7. In the fourth quarter of 2011, it will be the semi-conductive group whose annual growth rate in the first month will be negative.
Q: How do you look at the fundamentals of the foundry industry?
A: Looking at the just-concluded wafer foundry law, overall, the problem of inventory adjustment is not very serious. I am concerned that the weak demand situation may be worse than expected.
In terms of three major blocks such as PCs, mobile phones and consumer electronics, the inventory levels of mobile phones and consumer electronics are relatively high. Currently, the inventory levels are 2.9 and 2.7 months respectively, which is higher than the average of 2.3 and 2.2 months. The proportion of consumer electronics co-occupying demand exceeds 60%. When inventory de-consummation can be completed, it will be one of the major observations.
In addition, from the demand side, the growth rate of demand for PCs, mobile phones, consumer electronics and other products in 2011 was about 5%, and it is estimated that this will be the case in 2012. Even with smart phones and tablet computers, there is still only 11%. , But the foundry's capacity growth rate in 2011 reached 15% to 20%, plus 15% to 20% of the process miniaturization variable, which equals the capacity growth rate of 25% to 30%, which is equal to the gap between the wafer foundry industry supply and demand Up to 14 to 19 percentage points.
Assuming that the foundry's average capacity utilization rate reached 100% in the second quarter, it means that the capacity utilization rate in the next four quarters will have to drop to 83% to balance the supply and demand of the industry, and the growth rate of the revenue will continue in 2011. After falling (about 5% or less), it will be flat in 2012 and enter the so-called "stagnatic recovery" period.
Q: Do you mean that the wage generation wages on wafers are not enough?
A: From my point of view, I'm really not satisfied, but this is a last resort result because everyone must grab the 28-nanometer market. Even if you want to lower your capital expenditure, the rate will not be too big. Therefore, the next important thing to observe is that Yes, how long will the excess production capacity last? This is a structural issue. I think at least four quarters, the utilization rate of the next few quarters will not return to the peak of 100%.
Then the industry trend may become, manufacturers are unwilling to reduce capital expenditures, inventory is not easy to drop, resulting in the industry cycle in the past, the volatility will become quite slow, but also due to the lack of large-band market, the stock price is difficult Good performance.
Q: What are the more respectable ethnic groups next year?
A: I strongly recommend buying IC design groups, especially those who can grab low-priced ($100) smart phone market in emerging markets. There are at least seven reasons to support this view:
1. The gross profit margin of the semiconductor industry is relatively stable during the downturn of the economy; 2. More concessionary prices for OEMs are available at the current stage; 3. The recent active transition into the mobile device industry with higher gross margins; 4. The proportion of emerging markets is high; The high cash position can respond to the government's call for companies to buy back stocks and treasury stocks; VI. Lack of foreign capital to care for eyes; and 7. In the fourth quarter of 2011, it will be the semi-conductive group whose annual growth rate in the first month will be negative.
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