Dongwei Semiconductor's IPO on the Science and Technology Innovation Board was accepted, raising 939 million yuan to increase investment in power devices

On June 17, the Shanghai Stock Exchange officially accepted the IPO application of Suzhou Dongwei Semiconductor Co., Ltd. (hereinafter referred to as Dongwei Semiconductor) on the Science and Technology Innovation Board.

The prospectus shows that Dongwei Semiconductor is a technology-driven semiconductor company mainly engaged in the research and development and sales of high-performance power devices. Its products focus on medium and high-power applications in industrial and automotive related fields.

During the reporting period, Dongwei Semiconductor's main products include GreenMOS series high-voltage super junction MOSFET, SFGMOS series and FSMOS series medium and low voltage shielded gate MOSFET. The company's products are widely used in industrial-grade applications represented by new energy vehicle DC charging piles, 5G base station power supplies and communication power supplies, data center server power supplies and industrial lighting power supplies, as well as consumer electronics applications represented by PC power supplies, adapters, TV power boards, and mobile phone fast chargers. At the same time, the company continues to innovate in technology and further develops new products such as super silicon MOSFET and TGBT.

Dongwei Semiconductor has accumulated a globally renowned brand customer base in the aforementioned fields, and has become one of the domestic suppliers certified by some industry-leading customers. In the fields of industrial and automotive-related applications, the company has accumulated end users in the field of new energy vehicle DC charging piles such as Infineon, Incore, and Triumph, end users in the field of 5G base station power supply and communication power supply such as Huawei, Vertiv, and Magmet, as well as end users in the field of industrial power supply such as Gauss Power, Jinshengyang, Ray Energy, and General Electric. In the field of consumer electronics, the company has accumulated end users in the field of high-power display power supply such as CVTE, Midea, Skyworth, and Konka.

Wafer foundry is highly dependent on supplier A

From 2018 to 2020, Dongwei Semiconductor achieved operating income of RMB 152.8999 million, RMB 196.0466 million and RMB 308.7874 million respectively; and net profit was RMB 12.9743 million, RMB 9.1101 million and RMB 27.6832 million respectively.

Dongwei Semiconductor is a semiconductor power device design company that adopts the fabless model. It is not directly engaged in the production and processing of chips, and its main procurement content is wafers and packaging and testing services.

From 2018 to 2020, Dongwei Semiconductor's procurement amounts were RMB 139.5295 million, RMB 184.0935 million and RMB 270.1591 million, respectively; among them, the purchase amount of wafers accounted for a relatively high proportion, accounting for 83.98%, 85.36% and 82.15% respectively during the reporting period.

It is worth noting that during the reporting period, the purchase amount from Dongwei Semi-Guiding’s top five suppliers accounted for 99.56%, 99.29% and 99.01% of the total purchase amount during the period, respectively. Among them, the purchase amount from the largest supplier accounted for 83.59%, 81.70% and 80.19% of the total purchase amount during the period, respectively.

Dongwei Semiconductor said that during the reporting period, as downstream demand continued to expand, wafer foundries generally experienced capacity constraints. If the company's suppliers are affected by international politics, emergencies caused by force majeure occur, or the capacity constraints are further exacerbated, the wafer foundry and packaging and testing capacity may not be able to meet the company's needs, or the market prices of wafers and packaging and testing services will rise sharply, which will have a certain adverse impact on the company's operating performance.

Raised 939 million yuan to increase investment in power devices

Dongwei Semiconductor is a technology-driven semiconductor company focusing on the research and development and sales of high-performance power devices. Based on years of technology accumulation and R&D investment, it has strong independent R&D capabilities in the field of semiconductor power devices and has formed a number of patents. As of April 30, 2021, the company has been authorized 52 patents, including 38 domestic patents, including 37 invention patents, 1 utility model patent, and 14 foreign patents. In 2017, the company was awarded the title of Suzhou Super Junction Power Device Engineering Technology Research Center.

The funds raised from the initial public offering of Dongwei Semiconductor will be invested in the following projects after deducting the issuance expenses:

The super junction and shielded gate power device product upgrade and industrialization project is based on the company's rich accumulation of deep trench super junction technology and shielded gate technology, and improves and enhances the design and process technology of high-voltage super junction MOSFET products and medium and low voltage shielded gate MOSFET products.

The new structure power device R&D and industrialization project plans to launch high-speed IGBT, super silicon MOSFET and a new generation of high-speed and high-current power device products in the next three years. The aforementioned products can be widely used in 5G base stations, new energy vehicle DC charging piles, photovoltaic inverters and other sub-sectors.

The implementation of the R&D engineering center construction project will help improve the company's innovation level and efficiency, create a good experimental environment, attract high-end technical talents, accelerate the transformation of scientific research results, and provide stronger technical support for the company's sustainable development.

By supplementing technology and development reserve funds, Dongwei Semiconductor will effectively enhance the company's operating and R&D capabilities, improve the company's debt repayment ability, reduce the company's liquidity risk and operating risk, and thus improve the company's market competitiveness.

Regarding the future development strategy, Dongwei Semiconductor said that the company has always focused on medium and high power application fields such as industrial and automotive related fields, and is one of the few power device design companies with complete experience from patents to product mass production. The company's leading power device and process innovation capabilities have been fully verified in the fields of industrial-grade high-voltage super junction MOSFET products and medium and low voltage MOSFET device products. In the future, the company will continue to focus on innovative high-performance power semiconductor products and strive to become an internationally leading power semiconductor manufacturer.