The wafer factories have successively increased the code 28nm to form a missing core, the main battlefield closed testing and equipment links may significantly benefit.

First-class wafer foundry is focusing on the field of chips with more mature processes. According to sources, in order to meet the needs of customers such as automotive chips, CMOS image sensor (CIS), driver chips and radio frequency components, TSMC plans to actively expand the 28nm production capacity of mature manufacturing processes. It is estimated that in the next 2-3 years, the total 28nm production capacity is expected to increase by 100000 to 150000 pieces per month.

In the global wafer foundry, TSMC has an absolute advantage in advanced processes and has always played the role of a technology pioneer. However, this wave of shortage of semiconductors mainly appears in the mature process, in front of huge profits, the major contract factories have to adjust capacity planning, slow down the originally planned advanced process to catch up, and turn to expand the mature process, TSMC also has to allocate its energy to shift its focus from 3-7nm process to 28nm.

While it is reported that SMC intends to expand 28nm capacity, there are also signs of a slowdown in the relocation of machines and equipment from TSMC's 5nm and 3nm into the plant, and it is still being observed whether it is a temporary phenomenon, or whether the cost of machinery and equipment is too high, or due to changes in client demand.

Prior to this on March 17, SMIC also announced that it would cooperate with the Shenzhen government to focus on the production of integrated circuits of 28 nm and above and provide technical services, with SMIC Shenzhen as the main body, with the aim of achieving a final production capacity of about 40,000 12-inch wafers per month.

Why 28nm?

Since the beginning of 2020, novel coronavirus epidemic began to destroy the global semiconductor supply chain, in order to control the risk of chain breakage, manufacturers have pulled up the inventory level.

The shortage of semiconductors is mainly concentrated in the mature process field, the current market shortage of analog chips (power management chips), MCU, sensors (CIS, MEMS, etc.), RF chips, driver chips and other products are 28nm process, processor, high-end process shortage is less affected.

Huang Chongren, chairman of LSMC, also said in February that this wave of strong demand came from mature manufacturing processes, that no one had expanded production in the past few years, and that the development of applications such as 5G, AI and automotive electronics had only just begun, and that the shortage was "difficult to understand".

In terms of long-term demand, in the era of the Internet of everything, 5G, cloud computing, automotive chips and Internet of things chips expand a new growth space for 28nm. According to the research report released by Omdia, although the application of 28nm technology in the mobile phone field has declined after 2017, it has increased rapidly in many other fields, such as OTT boxes and smart TVs.

The steady expansion of large factories, closed testing and equipment links are expected to benefit significantly.

In addition to TSMC, wafer foundry SMIC and UMC confirmed a few months ago that they will expand their 28nm chip capacity. Most of SMIC's planned capital expenditure of US $4.3 billion in 2021 will be used for mature process expansion and a small amount for advanced process development. There is also news in the market that IC design companies such as MediaTek, Lianyong and Ruiyu are also considering production capacity cooperation with contract manufacturers to further meet the market demand for 28nm.

Geng Chen, an analyst at Huachuang Securities, said on July 4 that the strong demand in the mature process market and the steady expansion of SMIC's mature process is expected to benefit significantly from closed testing and equipment links.

Academician Wu Hanming, an expert in microelectronics technology and vice president of SMIC's technology research and development, also revealed at the investor exchange meeting that at present, mature processes at nodes above 10nm account for 83% of the market, while domestic companies can participate in 28nm and above processes in terms of design, manufacturing, and closed testing.

Among the A-share listed companies, Liyang has cumulatively developed 39 types of chip test solutions, covering advanced processes such as 8nm, 16nm, 28nm, etc. Tonfu Microelectronics FC, SiP, Fanout, storage, display driver products, high reliable automotive electronic packaging technology, BGA substrate design and packaging technology and high-density Bumping technology have all been industrialized. Jingfang Technology also has 8-inch and 12-inch wafer-level chip size packaging technology scale mass production packaging line, covering wafer-level to chip-level one-stop integrated packaging service capabilities.

To pure technology wet equipment can provide all the wet process to 28nm nodes, customers include SMIC, Huahong Group, Changxin Storage, Huawei, Taiwan Lijing, etc.; Northern Huachuang 12-inch ICP etching machine has broken through the below 28nm process; micro CCP etching equipment is used in international first-line customers from 65nm to 5nm, 64-layer and 128-layer 3DNAND wafer production line and advanced packaging production line.