How can Shengmei Shanghai break through the opportunities of domestic semiconductor equipment?

Latest update time：2021-09-16

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Recently, the latest report released by the Semiconductor Industry Association (SEMI) shows that in the second quarter of 2021, global semiconductor equipment shipments reached a record high of US$24.9 billion, a 5% increase from the previous quarter and a 48% increase from the previous year. From a regional perspective, mainland China is the largest semiconductor equipment market, with sales increasing by 79% year-on-year to US$8.22 billion, which is the main driving force for global market growth.

The semiconductor special equipment market is closely related to the prosperity of the semiconductor industry. As the scale of the semiconductor market continues to increase, the semiconductor equipment market is growing rapidly. According to SEMI, global semiconductor equipment sales will reach US$95.3 billion/101.3 billion in 2021/2022. It can be expected that with the continuous transfer of the global integrated circuit manufacturing industry to mainland China, as well as the expansion and capacity opening of a large number of wafer fabs in mainland China, the demand for semiconductor equipment in the Chinese market is expected to usher in a blowout growth in the future. The huge market space and expansion space have brought unprecedented development opportunities for domestic equipment.

However, looking at the current status of the industry, semiconductor equipment has long been monopolized by international giants. According to statistics from the China Electronic Special Equipment Industry Association (CEPEA), the self-sufficiency rate of domestic semiconductor equipment was about 17.5% in 2020. If only integrated circuit equipment is considered, the domestic self-sufficiency rate is only about 5%, accounting for only 1-2% of the global market.

There is a large gap between supply and demand of domestic semiconductor equipment

(Source: SEMI, Guosheng Securities Research Institute)

The overall backward situation of domestic semiconductor equipment has not changed, but there have been some breakthroughs in some areas. From a market perspective, domestic equipment has gradually made breakthroughs in cleaning equipment, furnace equipment, dry degumming equipment, etching equipment, polishing equipment, copper plating equipment and other links. In the entire replacement process, a number of companies have taken solid steps and achieved certain results.

The data of ASIACHEM's "China Semiconductor Wafer Factory Equipment Localization Quarterly Report" shows the progress of the localization rate of domestic semiconductor equipment. Among them, the localization rate of cleaning equipment has reached 20%, which is one of the sub-segments with a relatively high localization rate.

Forecast of the localization rate of semiconductor equipment and materials in China

Source: ASIACHEM "China Semiconductor Fab Equipment Localization Quarterly Report"

Domestic cleaning equipment took the lead in "breaking through"

Cleaning equipment is one of the most important equipment in a new production line of a wafer fab. It cleans the wafer surface without causing damage according to the requirements of different processes, thereby removing particles, metal pollution, organic matter and other impurities in the semiconductor manufacturing process. It directly affects the yield of integrated circuits, and its importance is self-evident.

According to Gartner statistics, with the recovery of the global semiconductor industry in 2020 and strong downstream demand, the cleaning equipment market size returned to the right track of growth, reaching US$3.341 billion for the whole year and is expected to reach US$4.324 billion in 2022.

In terms of cleaning equipment, ACM Shanghai is at the forefront among domestic single-wafer wet process equipment manufacturers. ACM Shanghai is one of the few semiconductor-specific equipment providers in mainland China with certain international competitiveness. It adheres to the development strategy of differentiated competition and innovation, and provides customized equipment and process solutions to global integrated circuit manufacturing, advanced packaging and other customers.

Looking back at the development history of Shengmei Shanghai in cleaning equipment and technology, in 2008, Shengmei Shanghai achieved a technological breakthrough and successfully developed the SAPS (Spatial Alternating Phase Shift) megasonic cleaning technology with independent intellectual property rights.

SAPS technology effectively solves the global problem of uniform distribution of megasonic energy on the surface of silicon wafers. By allowing the megasonic generator and the silicon wafer to move crosswise within a half-wavelength range, it ensures that the energy is completely evenly distributed at every point on the silicon wafer, thereby allowing the silicon surface to be fully and evenly cleaned.

It was also with this technology that ACM Shanghai successfully opened up the market. In 2009, ACM's first 12-inch single-wafer cleaning equipment entered the Hynix (Wuxi) factory. In 2011, ACM Shanghai received a mass production order from Hynix's Korean headquarters, and received multiple repeat orders in 2013, making it the first Chinese company to break into the Korean market with high-end semiconductor equipment.

SAPS megasonic cleaning equipment (Source: Shengmei Shanghai official website)

At present, this technology has applied for more than 75 domestic and foreign invention patents. The high-end single-wafer megasonic cleaning equipment developed based on this technology has entered the world-class integrated circuit production line. The customer base includes integrated circuit chip manufacturing, silicon wafer manufacturing, advanced packaging and scientific research institutions. Compared with similar international non-megasonic cleaning equipment, the single-step cleaning has a higher output yield of finished products.

Subsequently, Shengmei Shanghai developed the world's first TEBO (Timed Energy Excited Cavitation Oscillation) megasonic cleaning technology and Tahoe single-wafer tank combination cleaning technology in 2015 and 2018 respectively, and the scale of its semiconductor cleaning equipment business expanded rapidly.

It is understood that TEBO has solved another major problem of megasonic waves damaging graphic silicon wafers. This is because megasonic waves can cause bubbles in the liquid to explode, damaging small structures on the surface of graphic silicon wafers, even those below 70nm. In the end, this problem was perfectly solved by Shengmei Shanghai's TEBO exclusive patented technology.

TEBO cleaning technology is suitable for cleaning graphic silicon wafers of 28nm or below, and was successfully installed in Huahong Group in 2017. In the process of technological transformation from 2D to 3D product structure, TEBO-based cleaning equipment can be applied to more complex 3D structure products such as FinFET, DRAM, 3D NAND and matching 3D packaging to improve the yield of customer products. 3D structure will become the mainstream of chip development in the post-Moore era, providing huge development space for semiconductor chip technology routes in the next few decades. Shengmei's layout of TEBO patents will escort the company to become a global leader in cleaning technology in this field. In September 2020, Shengmei has delivered the second-generation TEBO equipment to a leading Chinese integrated circuit manufacturer for evaluation in a production environment.

In 2018, the successful development of its Tahoe technology enriched its technology and product line in the field of semiconductor cleaning equipment. Sulfuric acid is usually used in the cleaning process of semiconductor technology. Compared with single wafers, the single wafer + tank combination cleaning equipment Tahoe better solves the problem of large sulfuric acid consumption and difficult treatment. It can save more than 80% of sulfuric acid consumption, reduce the impact on the environment, and save a lot of procurement costs and waste liquid treatment costs for enterprises.

Overall, Shengmei Shanghai adheres to the development strategy of differentiated competition and innovation. Through years of technology research and development and process accumulation, it has successfully developed SAPS/TEBO single-wafer megasonic cleaning technology and Tahoe single-wafer tank combination cleaning technology, which can effectively solve the cleaning problems such as organic contamination and particles generated in the wafer manufacturing process, and greatly reduce the use of chemical reagents such as concentrated sulfuric acid. While helping customers improve production yield and reduce production costs, it meets the requirements of energy conservation and emission reduction.

Currently, Shengmei Shanghai occupies about 80% of the domestic cleaning equipment market. It is the cleaning equipment company with the largest market share and the most comprehensive products in China, and shoulders the heavy responsibility of localizing cleaning equipment.

Focus on "electroplating equipment" and "vertical furnace tube"

In addition to cleaning equipment, electroplating equipment is also one of the main business directions of ACM Shanghai. At present, ACM Shanghai has electroplating equipment for back-end advanced packaging and front-end copper interconnection, and has obtained orders from Changdian Technology and Huahong Group in 2018 and 2019 respectively. In March this year, ACM Shanghai launched high-speed copper electroplating technology, which supports copper, nickel (Ni) and tin-silver (SnAg) electroplating of interconnect copper bumps, redistribution layers, as well as warped wafers, copper, nickel, tin-silver and gold electroplating for high-density fan-out advanced packaging products.

Dr. Wang Hui, Chairman of ACM Semiconductor Equipment (Shanghai) Co., Ltd., said: "The high-speed electroplating technology launched by the company can solve the problem of mass transfer, obtain a better bump top profile, and improve height uniformity while maintaining high productivity, making ACM's electroplating copper technology successfully enter the first echelon of the world's top three."

Last month, ACM Shanghai released the Ultra ECP GIII electroplating equipment to support wafer manufacturing and wafer-level packaging of compound semiconductors SiC, GaN and gallium arsenide (GaAs). This series of equipment is equipped with a fully automatic platform, supports batch processing of 6-inch flat-edge and V-groove wafers, and combines ACM Shanghai's second anode and high-speed grid technology to achieve optimal performance.

Ultra ECP GIII Horizontal Electroplating Equipment

(Photo source: Shengmei Shanghai official website)

Dr. Hui Wang said: "The compound semiconductor market is booming with strong demand for electric vehicles, 5G communications, RF and AI applications. The compound semiconductor manufacturing process has always had limited automation and is restricted by production volume; in addition, most electroplating processes are carried out using vertical electroplating equipment with poor uniformity. ACM's newly developed Ultra ECP GIII horizontal electroplating equipment overcomes these two difficulties to meet the increasing production volume and advanced performance requirements of compound semiconductors." Currently, the equipment has obtained two orders from domestic compound semiconductor manufacturers.

In addition, in 2018, Shengmei Shanghai began to develop dry process equipment based on the wet process, and launched the vertical furnace equipment Ultra Furnace in 2020, further enriching the company's product line and expanding the market coverage of the products. The first vertical furnace equipment can achieve high-performance low-pressure chemical vapor deposition (LPCVD) after optimization.

At present, vertical furnace products have covered applications such as atmospheric pressure/low pressure alloy annealing, high temperature oxidation/annealing, silicon nitride/silicon oxide/polysilicon low pressure chemical vapor deposition, etc. Shengmei's R&D team is developing an atomic layer deposition (ALD) vertical furnace tube equipment, which is expected to be launched on the market in the first half of next year.

Vertical furnace tube equipment Ultra Fn (Source: Shengmei Shanghai official website)

Dr. Wang Hui pointed out, "With the launch of new process technologies to the market, Shengmei will basically make full use of vertical furnace equipment. This also marks that Shengmei has officially entered the field of dry equipment from wet equipment. Next year, it will focus on the research and development of high-end vertical furnace equipment."

Shengmei Shanghai layout

In addition to the above three series of products and technologies, ACM Shanghai recently announced new edge wet etching equipment, further expanding the coverage of ACM Shanghai in wet equipment.

Edge wet etching equipment (Source: Shengmei Shanghai official website)

Manufacturers have always used dry etching processes to solve the problem of edge film and contaminant removal. Wet etching is different from dry processes in that it avoids the risk of arcing and silicon damage, while also reducing the total cost of ownership through variable wafer edge film etching/cutting accuracy of 1-7mm, good uniformity, controllable etching selectivity and low chemical consumption. The first edge etching product for mass production was shipped in the third quarter of this year.

Dr. Hui Wang said: "The new equipment uses a wet etching method to remove various dielectric, metal and organic material films, as well as particle contaminants at the edge of the wafer, which can effectively solve the problem of reduced edge yield. At the same time, the integration of the backside wafer cleaning function further optimizes the process and product structure, which can achieve more efficient and accurate wafer alignment to achieve precise edge etching, thereby improving yield and production capacity."

After years of continuous R&D investment and market development, Shengmei Shanghai has successively developed semiconductor cleaning equipment such as single-wafer SAPS megasonic cleaning, single-wafer TEBO megasonic cleaning, single-wafer back side cleaning, single-wafer brush cleaning, automatic tank cleaning and Tahoe single-wafer tank combination cleaning, vertical furnace tube equipment, copper electroplating equipment for the front-end of semiconductor manufacturing and electroplating equipment for the back-end advanced packaging field, as well as advanced packaging wet equipment such as stress-free polishing equipment, wet etching equipment, glue coating equipment, developing equipment and glue stripping equipment.

It can be found that on the basis of continuously consolidating the original business, Shengmei Shanghai is also continuously developing new technologies, launching new equipment, constantly enriching the product line layout, improving its own competitiveness, and moving towards the direction of "an international company with multiple product platforms". At present, Shengmei Shanghai's cooperative customers include international major manufacturers such as South Korea's SK Hynix, domestic Yangtze Memory, Huahong Group, SMIC, Hefei Changxin, Silan Microelectronics, Jetta Semiconductor, Xin'en, Cansemi, Jinghe, Zhuosheng Microelectronics, GalaxyCore, Lianwei, Changdian Technology, Tongfu Microelectronics, Shenghe Jingwei, Shanghai Hejing, etc. are all customers of Shengmei Shanghai. The products have been recognized by many mainstream semiconductor manufacturers at home and abroad and have achieved a good market reputation.

Dr. Wang Hui said: "Our strategy has always been to find markets and applications with high growth potential in the semiconductor manufacturing industry, and work closely with our customers to rely on ACM's R&D team with original innovation genes to develop differentiated advanced technologies to solve industry problems and meet market and customer needs."

At the same time, Shengmei Shanghai is also continuing to expand its production capacity to meet strong customer demand in a generally tight supply chain environment. The company plans to start production in the second building of the Chuansha factory in Q3 this year and has increased its production capacity planning. The goal now is to achieve an annual production capacity of RMB 3 billion by Q4 this year. It is expected to further increase production capacity in 2022, with the combined production capacity of the two Chuansha factories reaching approximately RMB 3.5-4 billion. In addition, Shengmei’s production and R&D center established in the Lingang area of Shanghai, with a construction area of 100,000 square meters, can help the company strengthen its internal R&D, alpha prototype verification and customer sample demonstration testing capabilities, while achieving an annual production capacity of RMB 10 billion. It is now scheduled to begin initial production in early 2023.

Final Thoughts

In the next 10 years, China will become the global semiconductor chip manufacturing center. However, the development of China's semiconductor equipment is still in its early stages and cannot meet the needs of the rapidly developing domestic semiconductor industry. There is still a long way to go.

Dr. Wang Hui, Chairman of ACM Semiconductor Equipment (Shanghai) Co., Ltd., said that in the future, only companies with revolutionary and disruptive technologies will stand out and become the first echelon of global semiconductor equipment. ACM Shanghai will focus on its core advantages, improve core technologies and combine internal and external resources, based on differentiated independent innovation and research and development, promote the development of new products through investment and mergers and acquisitions, and combine effective and controllable overseas business expansion, expand and establish a full range of product lines with both wet and dry process equipment, continuously improve the company's comprehensive competitiveness and the global market scale that its products can cover, and strive to become the first echelon of comprehensive international integrated circuit equipment companies.

On August 17, it was learned from the official website of the Shanghai Stock Exchange that Shengmei Shanghai’s listing on the Science and Technology Innovation Board has been officially registered and approved.

The significance of this listing on the Science and Technology Innovation Board is not only to accelerate the company's progress in joining the first echelon of comprehensive international integrated circuit equipment companies, but also to provide more possibilities for future global competition.

Based on differentiated innovation and taking a differentiated product route, Shengmei Shanghai is leading domestic semiconductor equipment to create a new situation and promoting new development in the global semiconductor industry.

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