With the trend of display supply chain transfer and industrial enhancement in mainland China, a group of leading display driver IC companies and manufacturers are in the progress of new breaking through.
SMIC: Production capacity is king and the revenue of mature technology process nodes increases rapidly
Develop both mature and advanced technology nodes
In the Q3 of 2021, accounting for about 5% of the global wafer foundry market, the company ranked fifth in the world and the first in mainland China.
After 2010, the main products were PLD (Programmable Logic Devices), and the revenue CAGR (Compound Annual Growth Rate) was 14.07% from 2011 to 2020, mainly because of the expansion of production capacity.
In 2020, the wafer foundry accounted for 87% of revenue. From the process node point of view, 0.15/0.18um mature process and 55/65nm nodes contributed the most revenue, accounting for 33% and 31% respectively.
To meet the growing market demand through steady expansion, and gradually ease the tension of industrial capacity
The company owns three plants for 8-inch and four plants for 12-inch wafer production. The planned capital expenditure for 2021 is approximately RMB 28.1 billion, most of which will be used for the expansion of mature processes, and a small amount for advanced technology, the construction of new joint venture projects in Beijing, and others.
Among them, the plant for 12-inch respective in Beijing and the Shanghai Lingang with the production of 100,000 pcs is expected to be put into production in 2023, and the plant in Shenzhen with the production of 40,000 pcs will achieve mass production in the second half of 2022.
In 2022, the monthly production capacity will reach 600,000 pcs, and the capacity utilization rate will remain above 95%.
|Plant||Planning||2020 (month)||2021 (month)||2022 (month)||2023 (month)|
|Shanghai S (8″)||135K||120||130||135||135|
|Shanghai SN1 (12″)||35K||15||25||35||35|
|Shanghai SN2 (12″)||35K||0||0||10||25|
|Beijing B1 (12″)||60K||52||55||60||60|
|Beijing B2 (12″)||100K||62||70||80||100|
|Beijing B3P1 (12″)||50K||0||0||0||10|
|Beijing B3P2 (12″)||50K||0||0||0||10|
|Beijing B3P3 (12″)||50K||0||0||0||10|
|Beijing B3P4 (12″)||50K||0||0||0||10|
|Tianjin Fab (8″)||180K||95||105||115||130|
|Shenzhen Fab (8″)||70K||44||55||60||70|
|Shenzhen Fab (12″)||40K||0||0||40||40|
|Ningbo N1 (8″)||15K||15||15||15||15|
|Total (K/month capacity)||445.5||497.5||600||720|
|Annual capacity (K/year)||5346||5970||7200||8640|
Table 1. SMIC Capacity Forecast
The AMOLED DDIC production capacity continues to grow
Data from Omdia shows the continues growing of AMOLED DDIC production capacity, which will be to reach 7,000-8,000 pcs per month by the end of 2022.
At present, the major customer Raydium occupies about half of the 40nm production capacity. As to Chipone, ESWIN, Huawei HiSilicon, and OmniVision, they are in the process of sampling or sample verification, mass production will begin after the Q2 of 2022 at the earliest, which need the key source support from the new capacity developed by SMIC.
Will Semiconductor: Entered into display driver by acquiring Synaptics LCD TDDI (Touch Display Driver Integration)
Will Semiconductor started acquiring Synaptics’ Asia-based TDDI business in April 2020, and obtained the remaining 30% stake in 2021, officially entering the DDIC market.
According to the 2020 annual report, the TDDI business achieved sales revenue of 749 million yuan, and 100% financial consolidation began in the second half of 2021.
Data from CINNO Research, it occupies 6% of the smartphone TFT-LCD driver IC market in 2020 (excluding the share before the settlement of Synaptics TDDI business), ranked fifth.
TDDI business may return to growth
In 2015, Synaptics started launching the TDDI mass production solution for mobile phones and tablets, occupying the largest market share in the following two years, however, in 2019 its share dropped to 15% and ranked second.
Mainly because of:
(1) More and more competitors. At the TDDI price war stage, US IC manufacturers mainly keep ahead in technology at the initial stage, but not the price, which leads to only 1/3 of the original orders from Apple. After being taken over by Will Semiconductor, who may create high cost- performance products.
(2) As one of the three giants of EDA (Electronic Design Automation) software, Synaptics restricts sanctioned mobile phone manufacturers to use EDA software and provide TDDI, resulting in other domestic brand’s cautiousness in choosing US companies, the loss of some orders from domestic Android group, and Novatek taking the benefit from it. After the acquisition, it is expected to re-coordinate with domestic manufacturers and seize TDDI orders back from Novatek, FocalTech, and other Taiwan enterprises, achieving a significantly increased market share.
GalaxyCore: Focus on small and medium-sized markets, gradually changing from Fabless to Fab-Lite mode
Changing from Fabless to Fab-Lite mode gradually
Founded in 2003, mainly engaged in the design business of PC CMOS image sensors at the beginning, and gradually expanded to the mobile phone CMOS in 2007. In 2012, it realized the mass production of DDIC, enriched the product structure, and improved profitability.
During the last 20 years, by following the market trends to enrich product structure continuously, enhance technical strength, and improve the integration capacity of industrial chain resources, the company has achieved a steady improvement in the market position. In the future, the company plans to change from Fabless mode to Fab-lite mode by building part of the wafer fabrication of a 12-inch BSI Line, part of OCF manufacturing, and other processes.
The leader in small and medium-sized display drivers, and the shipment volume ranks second in China
Data from Frost & Sullivan, GalaxyCore ranked second among suppliers in China with 420 million LCD driver chip output in 2019, accounting for 9.6% of the output in China.
The display drivers are mainly deployed in small and medium-sized markets such as wearables, feature phones, and low and mid-end smartphones. It ranked first among local companies in both wearable and feature phone markets. In 2020, its revenue was 590 million yuan, accounting for 9.16%.
At present, LCD driver IC between QQVGA (120 * 160) and HD (1280 * 720) have been in mass production, while HD and FHD (Full HD) (1920 * 1080) resolution driver IC have entered small batch trial production.
In addition, the company actively promotes the research and development of TDDI, AMOLED driver IC and other products, to achieve rapid catch-up.
SinoWealth: Enter the pre-assembly brand market of AMOLED
After more than 10 years of cultivation, AMOLED has been in mass production.
In 2011, The R&D team launched the design of AMOLED DDIC, and in 2013 successfully launched HD and FHD hard screen AMOLED DDIC, in December 2014, started mass production to gradually replace the PMOLED business. SinoWealth is the first enterprise to realize AMOLED mass production.
In 2016, it established the CHIP WEALTH subsidiary, which specializes in the R&D of DDIC.
In Q1 of 2018, it completed the internal validation of the first FHD AMOLED display driver, and step into the 40nm process together with other international competitors. With the post-assembly maintenance market continuing to expand, the company now is entering the AMOLED pre-assembly brand market.
According to the company’s Q3 report, the YoY of sales of driver IC increased several times. From the revenue structure, in Q1 of 2021, the sales of display IC achieved 104 million yuan, which exceeded the whole year of 2020, and take the proportion of revenue from 6% to 15% in 2020.
Meanwhile, SinoWealth plans to launch the mobile phone screen AMOLED DDIC that meets the specifications of the pre-assembly brand market by the end of the year.
TongFu Microelectronics: Hefei Tongfu in-depth layout display driver package
One of the top three domestic packaging and testing leaders, ranked fifth in the world
The company has clear positioning through the way of endogenous extension, deploying production capacity in multiple locations, with complementary technologies. According to ChipInsights’s forecast, In 2021, the company achieve revenue of 14.537 billion with a YoY growth of 34.99% and a market share of 5.08%.
Currently, the main customers include AMD, MTK, STMicroelectronics, Infineon, Realtek, Awinic, Goodix, MAXSCEND, Will Semiconductor, etc. More than 50% of the world’s top 20 semiconductor enterprises and most of the domestic well-known IC design companies have become customers of TongFu Microelectronics.
Deep deployment in the display driver package
Hefei Tongfu focuses on ultra-high-density frame packaging products and undertakes peripheral memory and LCD driver businesses as well. It has the packaging technology of LCD/OLED driver, especially the 12-inch TDDI, and also has the production technology capability of 8K LCD Driver COF.
Hefei Tongfu’s customers include Bright Power Semiconductor, On-Bright, Shenzhen Sunmoon Microelectronics, etc. Meanwhile, it further introduced memory-related businesses and expanded DRAM packaging lines.
Chipone: Covering all categories and relying on big players to get through the industrial chain
Focuses on the field of display driver design and is one of the few display IC design companies with global competitiveness in China
Founded in 2008, the company focuses on IC design in the display field, covering TDDI, medium, and large size DDIC (LDDI), OLED display IC, power management IC, LED DDIC, Tcon (Timing Control) IC, fingerprint identification IC, touch IC, silicon-based OLED IC, and other full range display IC. Its customers cover global mainstream panel factories, domestic top-tier mobile phone brands, and well-known LED display factories.
Interest binding with the big players in both upstream and downstream
Both foundry fabricator SMIC and pannel provider BOE of midstream panels is its shareholders and downstream manufacturers. The business model breaks through the supply chain resource from design to production.
Data from ijiwei, the revenue was about 2.4 billion yuan in 2020, and will be to exceed 6 billion yuan in 2021, and the monthly shipment has exceeded 600 million pcs.
Nexchip: The third largest wafer foundry in mainland China, focusing on display drive OEM
Data from Frost & Sullivan, in light of revenue and capacity of 12-inch, Nexchiphas become the third largest wafer foundry in mainland China.
Nexchip focuses on panel driver IC products, and the main process covers 90nm-150nm. By the first half of 2021, its N1 factory has reached full production scale.
By the end of 2021, the total capacity of N1 and N2 plants will reach 100,000 pcs/month, which is expected to rank in the top 10 list in the global wafer foundry field.
In 2020, the foundry output of display driver wafers (equivalent to 12-inch wafers) reached 259,800 pcs, a market share of about 13%, ranked third in this field, behind UMC and Vanguard. The revenue showed rapid growth.
From 2018-2020, the company has achieved mass production of 150nm, 110nm, and 90nm products, with revenue of RMB 220/53/151 million respectively, showing a rapidly increasing trend.
In addition, the 55nm process node has made phased progress, in which TDDI will be in mass production in Q1 of 2022; and which’s logic IC platform has been developed and will start trial production in Q1 of 2022.
At the moment, the company’s key customers are Novatek, Chipone, and other well-known companies, and are actively developing new customer resources.
According to the announcement, the sales of IC in the first half of 2021 will reach 216,400 pcs, already accounting for 82% of the total sales in 2020. The average of IC sales is 7403 yuan per pcs, 29.31% higher than the average price in 2020. By the end of June 2021, the orders in hand were 473,500 pcs, valuing about 4.075 billion yuan.
Union Semiconductor: Leading in display driver packaging
Formerly known as Union Semiconductor (Hefei) Co., Ltd. It has been working in the field of DDIC packaging and testing for many years, its main business is the manufacturing of gold bumping, and it integrates CP (Chip Probing), COG, and COF, to form a comprehensive service capability for full-process packaging and testing of DDIC.
In 2020, the shipment of DDIC packaging was 828 million, ranked third in the global DDIC and first in China.