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IC carrier board is the most valuable substrate in the packaging process. IC carrier board is an important technology used to connect chips and PCB boards in IC packaging. It accounts for 40-50% of the material cost in low-end and mid-end packaging, and accounts for 40-50% of the material cost in high-end packaging. 70-80%, which is the technology with the largest value in the packaging process.
Since the second half of 2020, the prosperity of transistors has continued to rise, and IC substrates, as an important technology, are no exception. Due to the long-term lack of capacity expansion by carrier board manufacturers, two fires at the Shanying Factory of Xinxing Electronics, a major IC carrier board manufacturer, impacted the supply of IC carrier boards. As a result, the supply of IC carrier boards exceeded demand starting from Q4 of 2020, and the delivery period continued to lengthen. According to the Hong Kong Circuit Board Association, the prices of ABF carrier boards and BT carrier boards have increased by 30%-50% and 20% respectively. In the long term, due to the shortage of upstream substrates and long production expansion cycles, it is estimated that the tight supply and demand for IC substrates will continue until at least the second half of 2022.
Revenues and profits continue to grow, and the industry chain is booming. IC carrier boards and transistor test boards are key technologies for chip manufacturing and testing. They also benefit from the high prosperity of the chip industry chain, and the current order visibility is very high. In 2020, the global IC carrier board industry will be worth 10 billion U.S. dollars, a growth of 25%. Prismark predicts that the global IC carrier board industry will be worth 12 billion U.S. dollars in 2020, a growth of nearly 20%, and will reach 16 to 17 billion yuan in 2025, with a compound growth rate of 9.7%. By then, IC carrier boards will surpass flexible boards and become the largest sub-industry with the most certain growth in the circuit board industry.
The current scale of Chinese-funded carrier board factories in 2021 is US$400 million, with a market share of only 4%, while Chinese-funded packaging and testing factories have a global market share of more than 25%, and the Chinese-funded matching rate is only just over 10%. China's PCB production capacity accounts for 80% of the world's share, and China's PCB share accounts for more than 50%. The industrial chain from equipment to technology is very complete, and the global transfer of production capacity is the background of the times. The continued deployment of domestic wafer and packaging and testing production capacity in the future is a guarantee for future growth. Currently, there are only three Chinese companies with mass production capabilities and stable customer resources.
IC carrier board
IC carrier board demand side
The semiconductor industry continues to prosper, and demand for chip packaging and testing has surged, accelerating the clearance of carrier board production capacity. The implementation of emerging applications and the increase in shipments of electronic equipment such as PCs and 5G millimeter-wave mobile phones have driven the transistor boom. Strong chip demand has also driven a surge in IC carrier board shipments. Specifically: ABF carrier board: The demand for downstream high-performance computing chips is growing, and heterogeneous integration technology is expanding the use of single-chip carrier boards. ABF carrier boards are mainly used downstream for high-performance computing chips such as CPUs, GPUs, FPGAs, and ASICs. PC shipments have rebounded year-on-year for five consecutive quarters, and the construction of technology centers and 5G base stations has accelerated, driving the demand for high-performance computing chips to surge, and the demand for ABF carrier boards to rise. In addition, heterogeneous integration technology increases the packaging area and carrier board usage of a single chip. The maturity and widespread application of this technology will also further increase the demand for ABF carrier boards.
IC carrier board BT carrier board
5G millimeter wave mobile phones have driven up demand, and eMMC chip shipments have made steady progress.
1. AiP is currently the preferred packaging solution for 5G millimeter wave mobile phone antenna modules. BT carrier boards perfectly meet AiP packaging requirements in terms of functionality. As the penetration rate and shipment volume of 5G millimeter wave mobile phones increase, the demand for BT carrier boards increases. .
2. Memory chips such as eMMC are currently the main downstream applications of BT carrier boards. eMMC chips have been growing steadily in the medium to long term, and the booming IoT and smart car markets have further driven the new demand for eMMC chips. And currently, domestic storage manufacturers such as Yangtze Memory and Hefei Changxin have entered a production capacity expansion cycle and are expected to achieve a monthly production capacity of one million pieces in 2025, driving an increase in the demand for Chinese-funded replacement of BT carrier boards.
IC carrier board supply end
The IC substrate industry has high entry barriers, insufficient production capacity expansion, and technology and yield factors restrict supply growth. High capital investment, strict technological requirements and high customer barriers in the IC substrate industry have restricted the entry of new players in the industry to a certain extent; factors such as insufficient upstream raw materials and low manufacturer output yields have seriously affected the progress of production capacity expansion. .
IC carrier board ABF carrier board
Upstream technology is monopolized + yield rates are declining, and production expansion may be lower than expected. The key technology of ABF carrier board, ABF film, is monopolized by Japan's Ajinomoto Company. At present, although Ajinomoto Company has announced that it will increase production of ABF technology, the scale of production increase is conservative compared with the surge in downstream demand, and the CAGR of production by 2025 is only 14%. , causing the annual production capacity release of ABF carrier boards to only reach 10%-15%. In addition, the increase in ABF carrier board area has caused a decrease in carrier board production yield, resulting in a loss of production capacity. The trend of increasing downstream chip packaging area means that the actual expansion rate of ABF carrier board production capacity will be lower than market expectations. BT carrier board: The product life cycle is short, and leading manufacturers have low willingness to expand production. The life cycle of BT carrier board products is usually only about 1.5 years. Therefore, leading overseas manufacturers are generally conservative about the expansion of BT carrier board production capacity. Currently, the expansion plans disclosed by major overseas manufacturers are less than 10%. In addition, the rise in ABF carrier board prices has led to the conversion of some BT carrier board production lines, squeezing out BT production capacity, and further exacerbating the shortage of supply.
The explosion of demand and limited expansion of supply-side production capacity have pushed the price of IC carrier boards soaring, and carrier board manufacturers have directly benefited. For example, Taiwan’s carrier board suppliers’ monthly revenue has maintained a year-on-year growth of more than 20% since October 2020, and Chinese-funded IC Carrier board manufacturers Shennan Circuit and Xingsen Technology also performed well. In the medium and long term, as domestic wafer fabs continue to expand production, it will directly promote the continued expansion of the IC substrate market. The current IC substrate market is still mainly occupied by Xinxing and others, and the domestic matching rate is around 10%. Along with the downstream discourse With the increase in rights and the continuous improvement of the product quality of Chinese-funded IC carrier board manufacturers, Chinese-funded IC carrier board manufacturers will have a higher growth ceiling in the future.