Valuation is nearly 10 billion yuan! Is it still far from listing?

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On the evening of May 26, BYD issued an announcement stating that its subsidiary BYD Semiconductor Co., Ltd. (hereinafter referred to as "BYD Semiconductor") introduced a strategic investment of 1.9 billion yuan, led by Sequoia Capital, CICC Capital and SDIC Innovation, and participated in the subscription by Himalaya Capital and other domestic and foreign investment institutions.

BYD Semiconductor was previously valued at 7.5 billion yuan, and after completing this round of financing, its valuation increased to 9.4 billion yuan. It is worth noting that it took only 42 days from the announcement on April 14 that BYD Semiconductor had completed its internal restructuring and planned to introduce strategic investors to the current announcement of specific financing news. BYD also stated that after the introduction of strategic investors, it will accelerate the process of BYD Semiconductor's spin-off and listing . Previously, CICC estimated that if it was spun off and listed, it would have a market value of 30 billion yuan.

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The reason behind BYD Semiconductor's "speed" is that despite the global pandemic and the decline in the auto market, the automotive semiconductor industry has bucked the trend and shown strong development momentum. IGBT modules for new energy vehicles even often face periodic supply shortages. IGBT is BYD Semiconductor's main business.

Figure: BYD Semiconductor Business Information

Source: Qichacha

According to BYD Semiconductor's industrial and commercial information, its main business covers integrated circuit design and production and sales of large-scale integrated circuits with a line width of 0.18 microns or less, new electronic components and related accessories; production and operation of insulated gate bipolar transistor modules ; production and processing of LED light-emitting diode packaging and camera modules; research and development, wholesale and related supporting businesses of the above-mentioned products. Research and development, production and sales of silicon carbide crystal materials and single crystals, ceramic copper-clad circuit boards, metal-ceramic composite materials, metal-ceramic composite heat dissipation substrates, polymer materials for semiconductor packaging, and electronic ceramic powder materials.

IGBT is the abbreviation of Insulated Gate Bipolar Transistor, which is an insulated gate bipolar transistor. It is a composite power semiconductor device composed of BJT and MOSFET. It has the advantages of MOSFET, such as high switching speed, high input impedance, low control power, simple driving circuit, and low switching loss, and the advantages of BJT, such as low on-voltage, large on-state current, and low loss. It is unmatched by other power devices in terms of high voltage, high current, and high speed. Therefore, it is an ideal switching device in the field of power electronics and is widely used in new energy vehicles.

As for the status of IGBT in new energy vehicles, it can be said that IGBT modules, like power batteries, determine the performance of electric vehicles . In the future, the number of IGBTs used in a new energy vehicle will increase to more than 130, accounting for 7-10% of the vehicle cost.

Figure: BYD Semiconductor IGBT development history

It is reported that BYD established an IGBT research and development team as early as 2005, and completed the independent development of automotive-grade IGBT chips after acquiring Ningbo Zhongwei Semiconductor Wafer Factory in 2008.

With the continuous improvement of technology, the IGBT 4.0 technology released by BYD at the end of 2018 has significantly improved quality in terms of weight, volume, high voltage resistance, full life cycle and heat dissipation performance compared with previous generations of products. After more than ten years of development, BYD Semiconductor has now grown into China's largest IDM automotive-grade IGBT manufacturer , with products covering passenger cars and commercial vehicles.

With the widespread application of IGBT in the new generation of automobiles, it has brought huge market value. With the electric, intelligent and interconnected automobiles, the value of automotive semiconductors per vehicle will continue to increase, driving the global demand for automotive semiconductors to grow faster than the sales of complete vehicles. According to IHS data, the scale of global automotive semiconductors in 2019 was more than 40 billion US dollars, accounting for about 10% of the global semiconductor market. Among them, China is the largest market for automotive semiconductors. According to data from the International Association of Automobile Manufacturers, the global passenger car production in 2018 was 70.57 million, of which China accounted for 33%.

However, similar to other semiconductor products, due to the lack of IGBT technology-related talents in China and weak process foundation, domestic IGBT companies generally started industrialization late. IGBT modules still rely mainly on imports, and the market is mainly occupied by European, Japanese and American companies. According to NE Times data, during 2019, Infineon supplied 630,000 sets of IGBT modules to the domestic electric passenger car market, with a market share of 58%. Among the top ten manufacturers in China's new energy vehicle IGBT market in 2019, 7 were overseas semiconductors and occupied 70% of the domestic market.

Among domestic IGBT enterprises, BYD, Star Semiconductor and CRRC Times, which have performed well in the field of automotive IGBT, were generally established around 2005, starting late, but their technology has developed rapidly. Now Zhuzhou CRRC has broken through the full set of 1700V-6500V trench gate IGBT processes, and Star Semiconductor has broken through 600V-3300V planar and Trench NPT IGBT. BYD also relies on its downstream new energy vehicle manufacturers to introduce self-developed and self-produced IGBTs. According to a previous report by China Automotive News, BYD Semiconductor's IGBT chip production capacity is currently about 100,000 pieces/month.

In addition, domestic companies such as Hua Hong, China Resources Microelectronics, and SMIC Silan Microelectronics have also made rapid progress in IGBT. Hua Hong has successfully mass-produced 600V-1700V trench-structured NPT and FS (wafer thinning) IGBTs, while China Resources Microelectronics has developed 600V-1200V planar and trench NPT IGBTs.

The following are brief introductions to some major IGBT companies in China besides BYD Semiconductor:

Star Semiconductor, which went public this year, has become well-known to the public for its multiple daily limit increases. In fact, Star Semiconductor , founded in April 2005, is also mainly engaged in the design, development and production of power semiconductor chips and modules based on IGBT, and sells them in the form of IGBT modules. Related products are widely used in industrial control and power supply, new energy, variable frequency white appliances and other fields. Headquartered in Jiaxing, Zhejiang, it covers an area of ​​106 acres and has a registered capital of 120 million yuan. The company has subsidiaries in Zhejiang, Shanghai and Europe.

According to IHS data, in 2018, Star Semiconductor's share of the global IGBT module market was approximately 2.2%, ranking 8th in the world and 1st in China in terms of market share. It is the only Chinese company among the top ten in the world.

CRRC Times Electric's business covers the research and development and manufacturing of high-power semiconductor devices. It has fully mastered the technologies of power semiconductor products such as thyristors, rectifiers, IGCTs, IGBTs, SiC devices and power components. Its related products are widely used in high-speed rail, power grids, electric vehicles, wind power and other fields.

Starting from the power semiconductor chip design business, Silan Microelectronics has gradually built a chip manufacturing platform with special processes and formed an IDM business model. It has successively completed the research and development and design of high-power IGBTs, multi-chip high-voltage IGBT intelligent power modules, super junction MOSFETs, high-voltage integrated circuits and other products, and the power semiconductor product line has been continuously enriched. At the same time, relying on the 5- and 6-inch chip production lines that have been running stably and the 8-inch chip production lines that have been successfully put into production, Silan Microelectronics has successively completed the research and development of domestic leading high-voltage BCD, ultra-thin sheet trench gate IGBT, super junction high-voltage MOSFET, high-density trench gate MOSFET, fast recovery diode and other processes, ensuring the excellent and stable product quality.

Taiji shares is mainly engaged in the research and development, manufacturing, sales and services of power semiconductor chips and devices. Its main products are power semiconductor devices such as power thyristors, rectifiers, IGBTs, and power semiconductor modules. The high-power IGBTs developed by Taiji shares have been put into mass production. The high-power semiconductor pulse switching technology with completely independent intellectual property rights has reached the international leading level, and it continues to track the research and development and application of third-generation wide bandgap semiconductor technologies such as SiC and GaN.

Wingtech Technology acquired Nexperia Semiconductor to enter the semiconductor field. Nexperia's main products are discrete devices, semiconductor logic chips, power MOS devices, etc. It has the largest market share in the diode and transistor market and the ESD protection device market, and the second largest market share in the automotive MOSFET market. Its downstream partners cover the world's top manufacturers and service providers in the fields of automobiles, communications, and consumer electronics, and its market advantage is very significant.

Zhenhua Technology's semiconductor discrete device products are accelerating their transformation to high-end. At present, the company has completed the research and development of multiple products such as IGBT chips and modules, high-power Schottky diodes, and high-power rectifier diodes, and has continuously improved the IGBT chip product layout and completed the development of a series of chips, with technical performance reaching the level of similar foreign products.

HuaWei Electronics is mainly engaged in the design and development, chip manufacturing, packaging testing and sales of power semiconductor devices. At present, it has established the most complete and competitive power semiconductor device product system in China, from high-end diodes, unidirectional and bidirectional thyristors, MOS series products to the sixth-generation IGBT. It is gradually transforming from a single device supplier to a total solution provider. Related products are widely used in industrial frequency conversion and new energy fields.

Yangjie Technology is mainly engaged in the manufacturing of power semiconductor chips and devices, as well as integrated circuit packaging and testing. The company's main products are various power electronic device chips, power diodes, rectifier bridges, high-power modules, DFN/QFN products, MOSFET, IGBT and silicon carbide SBD, silicon carbide JBS, etc. Yangjie Technology is actively promoting the research and development of new IGBT module products, and has successfully developed 50A/75A/100A-1200V half-bridge IGBTs.

Jiangsu Hongwei Technology Co., Ltd. is a national key high-tech enterprise established by a group of scientific and technological personnel who have been engaged in the research and development and production of power electronic products at home and abroad for a long time and have a variety of special technologies. The company has complete design, development and production capabilities from 600-1700VIGBT chip design, module packaging, characteristic analysis and reliability research. The self-produced 600-1200VIGBT chips have been widely used in the field of industrial motor controllers, breaking the long-term monopoly of foreign IGBT chips. The automotive MOSFET and IGBT modules developed by the company have been used in electric forklifts, golf carts, electric logistics vehicles and low-speed electric vehicles at home and abroad; the IGBTDCDC power modules developed by the company have been widely used in electric buses.

It should be pointed out that BYD Semiconductor is currently the only company in China that has a complete IGBT industry chain , mastering key links from IGBT chip design and manufacturing, module design and manufacturing, high-power device test application platform, to power modules and electronic control. Backed by BYD Auto, it also has the largest share of the domestic auto market, up to 18%.

At the end of 2019, it was reported that Huawei HiSilicon was also rapidly entering the automotive chip field, and IGBT became its new target. However, Huawei has not publicly confirmed this news. If the news is true, HiSilicon IGBT plus Huawei's existing Balong and Kirin series chips and Hongmeng operating system will gradually form the hardware and software foundation required to build a domestic smart car ecosystem.

Even if we leave aside HiSilicon's layout in IGBT, at present, domestic IGBT technology has continuously made breakthroughs on the supply side. IGBT companies represented by Star Semiconductor and BYD have been rising, upstream and downstream industry cooperation has been launched, and import substitution is on the way; on the demand side, under the background of Sino-US friction and the general trend of electric intelligent interconnection, the value of automotive semiconductors per vehicle has increased significantly, and automotive semiconductors will face a new round of growth. Therefore, in the future development of China's automotive semiconductors, IGBT is expected to usher in a resonance of demand and supply in China!