domestic memory chip companies to get together and go public. In fact, the focus has been extended from storage chip companies to the upstream and downstream of the entire storage industry chain. Many companies have been listed in the past three years, and many storage companies are queuing up for IPO. In this context, " International Electronics Business " recently interviewed Chen Lei, deputy general manager of Dongxin Semiconductor Co., Ltd. We discussed the current situation of Dongxin after its listing, and also analyzed the topic of domestic alternatives in the storage industry.
Observing the development of the domestic storage industry chain in recent years, it can be found that storage chip companies have a tendency to get listed together. In addition to the earlier listed Ziguang Guowei (June 2005), Netac (January 2010), Beijing Junzheng (May 2011), Zhaoyi Innovation (August 2016), In addition to Guokewei (July 2017), other memory chip manufacturers, such as Montage Technology, Juchen, Pura, Dongxin, Fudan Micro, Hengshuo, Longsys, etc. All within the last three years.
Obviously, it has become a trend in recent years for domestic memory chip companies to get together and go public. In fact, the focus has been relaxed from memory chip companies to the upstream and downstream of the entire storage industry chain, including silicon wafer , photoresist and other raw material manufacturers Shanghai Silicon Industry, Leon Micro, etc., chip manufacturer SMIC And so on, the listing time of these companies is also within the past three years. In addition to companies that have already been listed, there are many storage companies that are queuing up for IPO.
In this context, "International Electronics Business" recently interviewed Chen Lei, the deputy general manager of Dongxin Semiconductor Co., Ltd. (hereinafter referred to as Dongxin). In this exclusive interview, we discussed the current situation of Dongxin after its listing, and also analyzed the topic of domestic alternatives in the storage industry.
Chen Lei, Deputy General Manager of Dongxin Semiconductor Co., Ltd.
What is the current situation of Dongxin after its listing?
On December 10, 2021, Dongxin shares were listed on Shanghai Stock Exchange Science and Technology Innovation Board, stock code is SH 688110. Regarding "why did you choose to list on the Science and Technology Innovation Board", Chen Lei said frankly that Dongxin shares were officially listed on the Science and Technology Innovation Board. Listing on the Science and Technology Innovation Board is a new starting point for the company's future development, and it also puts forward higher requirements for Dongxin. He believes that the listing on the Science and Technology Innovation Board will bring a strong brand effect and to Dongxin shares, and can more effectively focus the attention of investors.
As a integrated circuit design company, Dongxin Co., Ltd. has been adopting the Fabless business model to carry out business. It is mainly responsible for chip design, wafer testing, product testing, sales and other core links. "The Fabless production model allows us to concentrate on chip design and development, ensuring rapid adjustment in the fierce market competition. Through continuous innovation and iterative improvement of key performance of products, we can provide customers with NAND, NOR, and DRAM storage in a targeted manner. A complete chip solution." Taking Dongxin's SLC NAND Flash as an example, Chen Lei said that the products using SMIC's 38nm/PSMC 28nm process have been mass-produced, and the products using SMIC's 24nm have reached the mass production standard. The products of the core international 1xnm process node have entered the research and development stage.
It is worth noting that Dongxin’s total operating income in 2021 will be 1.134 billion yuan, the annual revenue will increase by 44.62% year-on-year, and the net profit attributable to the parent will be 262 million yuan, an increase of 1240.27% compared to 2020. According to the 2021 annual report of Dongxin Co., Ltd., the reasons for the sharp increase in net profit are: first, the gross profit margin of products has increased. With the gradual expansion of sales scale and the emergence of scale effect, the company continues to shrink the manufacturing process and improve the yield rate. At the same time, it also continues to optimize the structure of existing products. There was a big increase in the same period last year; second, financial expenses decreased. Affected by the large appreciation of RMB in the same period of last year, the exchange loss was relatively large. During the reporting period, the company reduced the exchange loss by strengthening foreign exchange management.
accelerates the promotion of small and medium-capacity storage domestically replaced
This year is already 2022, and it is also the third year under the influence of the new crown epidemic, In Dongxin's view, what are the new trends that deserve attention in the domestic small and medium-capacity storage market? On August 16-17, 2022, the IIC 2022 International Integrated Circuits Exhibition and Seminar hosted by AspenCore will be held in Hall 2 of Nanjing International Expo Center. At the IC Leaders Summit at the same time, Chen Lei will give a speech on the theme of "Opening the Chip Era, Local Storage "Core" Mission", click to register for free. In this interview, Chen Lei also analyzed the topic of domestic alternatives.
With the vigorous development of emerging fields such as new infrastructure, the Internet of Things, and automotive electronics, the demand for storage is expanding. In the era of full "chips", local memory chip companies must take on the mission to provide an efficient and reliable solution for the growing storage needs. s solution. For the domestic small and medium-capacity storage market, only by seizing development opportunities, improving product performance, and refining processes can we take on the mission of the "core" of the times. He mainly analyzes it from four aspects:
(1) The process is constantly improving, and the design and manufacturing links are deepening the industrial linkage
Whether the integrated circuit manufacturing technology is advanced or not directly determines the cost and performance of the memory chip. Under the Fabless mode, memory chip design companies will continue to deepen cooperation and development with local wafer foundries in order to improve product manufacturing processes and narrow the gap with leading companies. The two parties share R&D capabilities, integrate technical resources, and form a standard manufacturing process. process, reduce the time cost of process docking, and improve the tape-out yield and product performance of memory chips. Since its establishment, Dongxin Semiconductor has been committed to achieving technological breakthroughs in local memory chips. Through a unified underlying design and functionally variable R&D architecture, it has built a powerful database for design circuit diagrams and packaging and testing, and realized chip design and manufacturing. The ability to control the entire process of process, chip design, packaging and testing, etc., and has completely independent intellectual property rights. The 24nm NAND and 48nm NOR designed, developed and mass-produced are the current leading NAND and NOR processes in China.
(2) The scale of the industry is huge, and differentiated competition forms market segment opportunities
Although the memory chip market is huge, the entire market is fragmented. In recent years, it has focused on the research and development of large-capacity and high-performance memory chips, continuously promoted advanced memory technology, and gained a high market share by virtue of its technological advantages. Due to the different development stages of other companies in the industry, while aiming to catch up with leading companies in technology, combined with their own technical characteristics and market demand, they focus on the segmented market of mature products and achieve filling and substitution effects, forming differences Globalized competition ushered in new opportunities for development. Dongxin Semiconductor strengthens the coordination of the industrial chain to ensure product delivery capabilities. Based on scientific and effective demand forecasting methods, it improves the sales management system, conducts in-depth research on user needs, increases the proportion of differentiated customized products, and enhances customer stickiness.
(3) The downstream demand is strong, and the rise of emerging industries accelerates industrial development
The domestic integrated circuit industry develops rapidly, and the demand in the terminal market continues to rise. Memory chips are irreplaceable functional devices in consumer electronics,communication equipment,, Internet of Things and other fields , and its sales in the domestic market also showed a steady upward trend. With the rapid development of emerging industries such as 5G communications, automotive electronics, and wearable devices, terminal products such as 5G base stations, ADAS, and smart electronic products continue to emerge. The requirements are also rising. Therefore, the quantity, performance and cost of memory chips will have continuous strong demand and continuous iteration requirements in the future. Dongxin Semiconductor will also maintain the performance leadership and competitive advantages of the company's existing products through continuous R&D innovation, process upgrades and performance iterations; The layout and development of emerging fields such as medical care and health, increase the market share of the company's products, and simultaneously enhance the ability to customize products and services; adhere to the core of storage products, expand intelligent extension and be application-oriented, and develop distinctive storage products Products, increase profitability through differentiation; continue to develop domestic high-quality customers, serve important customers in the industry, start to expand overseas markets in a planned and step-by-step manner, and enhance the company's market position and influence in Europe and the United States.
(4) Keeping up with the national strategy, domestic substitution promotes industry development
In 2014, the State Council issued for the first time the programmatic document "National Integrated Circuit Industry Development Promotion Program" for integrated circuits, highlighting the dominant position of enterprises, being demand-oriented, and Technological innovation, model innovation, and institutional mechanism innovation are the driving forces to break through the bottleneck of key integrated circuit equipment and materials, promote the overall improvement of the industry, and achieve leapfrog development. Subsequently, governments at all levels in our country issued a series of policies to attract outstanding enterprises and talents to settle down in terms of financial support, subsidies and rewards, which further highlighted the country's emphasis on the integrated circuit industry.
The trade friction between China and the United States in the high-tech field has been superimposed in recent years. Due to the tightening supply of foreign manufacturers to the domestic market, the domestic IC market demand is urgently needed to be filled by domestic companies with advanced product technology and high-quality service capabilities, especially large-scale domestic companies. In order to ensure the stability of operation, the terminal brand merchants have accelerated the construction of the local supply chain system, which has further promoted the process of domestic substitution of memory chips in my country.
Development trend of small and medium-capacity storage devices
In the first half of this year, due to the impact of Western Digital and Kioxia joint venture raw material pollution incidents, the NAND Flash market is already brewing price increases. At that time, the market research agency predicted that Q2 NAND Flash would rise by 5%-10%, and everyone was also worried that this accident would trigger a butterfly effect, , and drive price fluctuations of other storage products. By July 2022, both memory chip factories and market research agencies have issued warnings that demand for memory chips may cool down in the second half of this year. This means that in the first half of the year, the effect of the raw material pollution incident of a major memory chip manufacturer did not continue into the second half of the year.
Chen Lei stated that the memory chip market is closely related to the macroeconomic as a whole. If the macroeconomic fluctuations are large, the market demand for memory chips will also be affected accordingly. In addition, if the demand in the downstream market is sluggish, it will also lead to a decline in the demand for memory chips, which in turn will affect the profitability of memory chip companies. In general, the overall fluctuations in the macroeconomic environment and the downstream market may also have a certain impact on memory chip companies.
What is the future development trend of SLC NAND, consumer NOR or small and medium capacity DRAM?
Chen Lei Looking at the longer-term market trend, with the gradual maturity of the downstream consumer electronics market such as personal computers and smart phones, the emergence of innovative technology products will bring new opportunities to the integrated circuit design industry. Memory chips have been gradually used in emerging fields such as automotive electronics, 5G communications, and smart terminals. There will be continuous demand for end products such as ADAS systems, 5G base stations, and smart homes. The rapid development of these application fields and end products will further drive memory chips. Demand is constantly increasing. He firmly believes that emerging markets will bring new development opportunities to companies in the memory chip industry and will form a stronger support for the market demand for memory chips.
Dongxin Co., Ltd. is making continuous efforts to improve product performance, refine technology and process, and innovate. He revealed: "On the basis of the existing memory chip design capabilities, the company cooperates with SMIC to develop and produce 1xnm NAND Flash chips, realizing a further breakthrough in the advanced process technology of domestic memory chips, so as to design higher capacity and more efficient chips for the future. Products with cost advantages open up space. In addition, Dongxin will focus on high value-added products, vigorously develop automotive-grade memory chips, and realize the industrialization of automotive-grade flash memory products. At the same time, it will also build a research and development center to develop storage and computing integration Forward-looking products such as chemical chips and DTR NAND.”
Editor: Clover.li
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