Chinese semiconductor industry

Manufacturing & equipment​

Goldenscope Tech, also known as Jinjing Technology, received tens of millions of yuan (CNY 10.0M is ~$1.4M) in a Series A+ round led by Lightspeed China Partners, joined by CDH Investments, Fortune Capital, TigerYeah Capital, and others. The startup builds cathode fluorescence imaging systems and spectral detection systems. Alongside uses in numerous scientific fields, they can be used in the semiconductor industry to detect device defects, improve raw material processes, and conduct IC failure analysis. In the future, it plans to expand to electron microscope peripheral products such as an ultrafast cathode fluorescence system, transmission electron microscope cathode fluorescence system, and low-temperature electron microscopy. Funds will be used to open a new R&D office. Based in Beijing, China, it was founded in 2018 and raised over CNY 100M in 2022.

KyLitho drew tens of millions of yuan (CNY 10.0M is ~$1.4M) in Series A financing from Infinity Capital, Meihua Venture Capital, and Panstar Asset Management. The startup provides a thick-film lithography process for manufacturing integrated passive devices. Founded in 2017, it is based in Shenzhen, China.

Gona Semiconductor Technology raised around CNY 10.0M (~$1.4M) from West Shanghai. Gona Semi makes , including Equipment Front End Module (EFEM), wafer sorter, wafer loading system, and open cassette stage. Based in Shanghai, China, it was founded in 2020.

Laplace Energy Technology received new financing from China Life Science and Technology Innovation Fund and Yunhao Capital. Laplace makes for semiconductors and photovoltaic manufacturing. Its products include equipment for low pressure chemical vapor deposition, plasma enhanced chemical vapor deposition, atomic layer deposition, ultra-high temperature annealing and oxidization, diffusion furnaces, and low pressure horizontal diffusion systems. Based in Shenzhen, China, it was founded in 2016.

Starmask, also known as Longtu Photo Mask, raised from Silan Ventures and others. The company makes photomasks. It currently offers precisions down to 130nm for ICs and also provides photomasks for power semiconductors and MEMS. Funds will be used for construction of a new manufacturing facility. Founded in 2010, it is based in Shenzhen, China.

Talents & Technology raised that included CasStar. The company provides for battery, semiconductor, and other advanced manufacturing industries. Its products include manufacturing execution software (MES), laboratory information management system (LIMS), quality management system (QMS), and an R&D big data analysis system. Founded in 2009, it is based in Liyang, China.

Test, measurement & inspection​

Macrotest raised hundreds of millions of yuan (CNY 100.0M is ~$14.3M) in Series C and C+ funding from BYD Group, Yunjin Capital, Beyond Moore Fund, and others. Macrotest makes semiconductor including ATE and test boards for high-speed digital, high-voltage and high-current analog, mixed-signal, and RF ICs. Founded in 2018, it is based in Nanjing, China.

UniSiC Technology, also known as Chenxin Technology, closed a CNY 100.0M (~$14.3M) Series A round led by Summitview Capital. UniSiC develops for silicon carbide (SiC) devices, from SiC wafers to power modules. Alongside test equipment, it offers a SiC CT high-voltage generator, integrated X-ray source, and MRI gradient power amplifier, as well as SiC power modules for applications including automotive and medical devices. Funds will be used for R&D and mass production of test equipment and medical SiC power components. Founded in 2020, it is based in Shanghai, China.

Saimai Measurement and Control drew tens of millions of yuan (CNY 10.0M is ~$1.4M) in pre-Series A funding led by Addor Capital. The company provides , frequency source components, frequency conversion components, digital receiver components, RF and microwave signal generation components, RF microwave transceivers, and high bandwidth vector modulation and analysis. Founded in 2021, it is based in Suzhou, China.

MaxOne Semiconductor closed Series D+ funding led by Fosun Capital and Lanhor Capital. MaxOne offers IC wafer test including 3D MEMS vertical probe cards and RF MEMS vertical probe cards. Funds will be used for R&D and construction of production lines. Based in Suzhou, China, it was founded in 2015.

PIQS received led by Guosen Capital and Green Pine Capital Partners. PIQS provides laser profilers and 2D and 3D visual inspection systems for PCBs, consumer electronics, batteries, automotive parts, and other industries. Based in Shenzhen, China, it was founded in 2013.

Materials​

Eswin Material, a division of Eswin Technology, raised led by China National Building Material, joined by investors including Source Code Capital, Yufu Holding Group, Financial Street Group, Shang Qi Capital, SDIC Venture Capital, Hudson Capital, GF Venture Capital, China Life Private Equity Investment, Zhongji Investment, Puyao Capital, and China Development Bank Capital. Eswin Material produces 12-inch monocrystalline silicon polished wafers and epitaxial wafers. Current monthly production capacity is 300,000 pieces, which is expected to reach 1 million pieces per month at completion of its current expansion.

PowerEpi drew led by SDIC Venture Capital and Songshan Lake Materials Laboratory, joined by Leaguer Capital, Shenzhen Capital Group, China Capital Management, and Glory Ventures. The startup manufactures silicon carbide (SiC) epitaxial wafers. Funds will be used for R&D and production capacity expansion. Founded in 2020 to commercialize research from Songshan Lake Materials Laboratory, it is based in Dongguan, China.

Enkris Semiconductor raised (CNY 100.0M is ~$14.3M) in Series C financing led by Nio Capital and DragonBall Capital, joined by Xinke Capital, China Renaissance, GoerTek, and 37 Interactive Entertainment. Enkris Semiconductor offers for power electronics, micro-LED, and microwave RF applications. Its products include GaN-on-Silicon, GaN-on-SiC, GaN-on-Sapphire, and GaN-on-GaN epi wafers in various sizes, including 300mm. Based in Suzhou, China, it was founded in 2012.

Su Chuan Technology raised CNY 100.0M (~$14.3M) in funding. The startup makes ultra-thin for flexible and rollable displays, foldable smartphones, and flexible sensors. It is currently focused on 0.03mm, 0.05mm, and 0.07mm glass and plans to offer a range of different fold types. Based in Nantong, China, it was founded in 2020.

Weimai Core Materials drew CNY 100.0M (~$14.3M) in funding from Hefei Industry Investment Group, Beyond Moore Fund, Jinbang Capital, and others. The startup manufactures materials for ArF, KrF, and I-line photoresists, including photoacid generators, photoinitiators, bottom anti-reflective coating (BARC) layers, and zirconium-based precursors. Funds will be used for mass production and R&D. Founded in 2021, it is based in Suzhou, China.

U-MAP raised from Real Tech Holdings, Kyoto University Innovation Capital, Chukyo Yushi, Aichi Capital, Seiko Epson Corporation, and Global Brain Corporation. U-MAP has developed a based on fibrous aluminum nitride single crystals to improve the heat removal performance of ceramics, resin, and rubber materials used in electronics devices, including consumer electronics, automobiles, energy storage, communications, and aerospace. It says its material provides up to 4x the heat conduction capability compared to standard thermal additives with increased tensile strength, reduced brittleness, and extended thermal tolerance. Funds will be used to start mass production. It also plans to start producing aluminum nitride substrates using its material in 2024, followed by high thermal conductivity resin products such as heat dissipation sheets in 2025. A spin out from Nagoya University founded in 2016, it is based in Nagoya, Japan.

Shangxin Jinggong New Material Technology received tens of millions of yuan (CNY 10.0M is ~$1.4M) in funding from Hefei Industry Investment Group and others. The company produces diamond-copper heat sinks for electronic packaging and high-end sputtering targets using spark plasma sintering. It also makes anode target discs for CT machines. Funds will be used for purchasing equipment, R&D, and marketing. Based in Hefei, China, it was founded in 2021.

Hyperion Technology raised Series A+ financing from Topping Capital. The startup manufactures , conductive silver glue for semiconductor packaging, and electronic ink for use in flexible circuits and touch displays. Funds will be used to upgrade and expand production lines as well as for R&D and hiring. Founded in 2016, it is based in Beijing, China.

LingGas drew Series B financing from CDB Technology Venture Capital, Guofang Capital, Lianhe Capital, and Stony Creek Capital. The company provides for manufacturing ICs, displays, photovoltaics, and optical fibers. Founded in 2018, it is based in Beijing, China.

latest bidding info，YanDong still buying foreign equipments，further prove that their production line isn't "fully domestic"

tphuang said:

btw, that's 2 billion RMB for a domestic production line. This should be the tip of iceberg for how much they are investing for domestic tools around China. His comments are a little conflicting because he talks about already have a 28nm line with domestic line that an eventually be extended to 14nm, but then later makes it sounds like they haven't started testing it yet.

My guess is that what they have right now is a fully functional Arf dry that's been operating for a few months (remember the LAM employee interview from Oct where he said ICRD Jiading has a fully Chinese tools line) When we hear recently about the few domestic tools that just got verified for Arf process, that most likely got verified in Q4. We are almost reaching the point where they are confident about it, so mass production for Arf should start in a couple of months, I guess.

Again, ramping up production of everything is key here.


Keep in mind that this was in reference to ICRD. When asked about why it takes so long, he answered.

In general, I feel like he is very reluctant to talk about progress outside of SMEE and ICRD, since he is mostly familiar with the work they are doing with ICRD. Again, that's why I think DUVi will get validated on SMIC first.

His other points are quite enlightening:
1) It implies that there are non-lithography scanner tools that are still need to be fully developed and validated. We may have seen patents and such announced, but that does not mean certain tools are ready for a production line. I think we can assume that they can get these tools for other countries like Japan, Korea and Netherlands. Whether they can be utilized for 14nm production is another story, but I think 22 to 28 nm should be no problem.
2) The first lithography machine is always the hardest. It took them 4 years from that original certification of SSA600 before it started mass production. So his comment about a few years is likely based on that painful experience. It's reasonable to assume that SSA800 dry has taken a lot less time to reach this point, since it's almost ready for mass production.
3) He is expecting another 2 to 3 years for ICRD to go fully domestic on DUVi (keep in mind that no other Chinese fabs need to go fully domestic, so that's not a consideration for them), because it will take them a few more months to fully validate the 55nm all domestic production line. Which means, it will take another 2 years on top of that to move in the domestic tools for 28nm production and then validate it. That seems a little longer than expected, but is not crazy.

I think SMIC is likely a lot better at this stuff than ICRD and will get their validation of SSA800 immersion finished sooner than that. I think early 2024 (so a little over 1 year in validation of process) is entirely reasonable. I would be surprised if SMIC doesn't have a couple of SSA600 in its production line somewhere, so they should have some experience already with SMEE front end scanners.

My guess is that the second gen DUVi is also likely to get validated in SMIC first with a process that's de-Americanized, but not fully domestic. Again as of now, I predict early 2024 to start mass production of SSA800 immersion and early 2025 for second gen DUVi that will start of being 14nm and eventually used for 7nm.

SMIC needs to import enough of the later generation ASML DUVi scanners to last until late 2024 if they do not want to miss any additional time in their advanced process production.

But the underlying suppliers are the same, so unless they can get that ramped up, there is an upper limit to the number of DUVi they can produce.

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What equipment does Korea produce that China does not?

FairAndUnbiased said:

What equipment does Korea produce that China does not?

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i have doubt that, South korea produce anything related critical chip tools. they itself highly dependent on foreign made tools.


Korea's dependence on semiconductor equipment from the U.S., Japan and the Netherlands has reached 77.5 percent, sparking worries that the high level of dependence could be geopolitically and diplomatically risky in the future. Some experts are advising Korea to join the Chip 4 Alliance to ensure a stable supply of semiconductor equipment, according to a Korea International Trade Association (KITA) report, Thursday.

The KITA released a report titled, "Recent Semiconductor Equipment Trade Trends and Implications," and it states that global semiconductor equipment trade increased 2.4 percent year-on-year in 2018 due to a surge in global semiconductor equipment investment, recording a record high of $101.2 billion. The top three export countries for semiconductor equipment were Japan ($31.2 billion), the U.S. ($28.4 billion), and the Netherlands ($20.1 billion).

In the global semiconductor equipment market, five major semiconductor equipment companies, including Applied Materials (U.S.), Lam Research (U.S.), KLA (U.S.), Tokyo Electron (Japan) and ASML (Netherlands), account for 79.5 percent of the total.

Korea is highly dependent on semiconductor equipment supplied by these companies.

As of last year, Korea's dependence on equipment imported from the U.S, Japan and the Netherlands reached 77.5 percent, which is higher than Taiwan (70.6 percent) and China (56.2 percent)..

China indigenous tools percentage is highest among these countries. that too as of 2021.

tonyget said:

That's one of the problem ICRD fully domestic line facing. How do they promote this fully domestic line once the validation process completed？Unless Chinese fabs being totally cutoff from all foreign suppliers，which they are still far from it，they have no incentives to adopt fully domestic line. Fabs are more likely to adopt productions line mixe of domestic and foreign equipments. Huawei might be the exception.

I guess the way how it works，is that ICRD has a working fully domestic line，that means all equipments on that line has been validated. Fabs can pick which domestic equipment they want on their production line from ICRD

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That's where the government subsidies for domestic tools come into play. The big issue with Chinese tools industry isn't the lack of desire for domestic foundries to use them, but rather lack of production capacity. You can only increase head count and production so much. It takes a lot of time to validate new tools with customers in their production process. These things don't happen overnight.

I mean the domestic firms are now winning 60% of bids normally. That's pretty good for 3 months after the October surprise.

tonyget said:

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latest bidding info，YanDong still buying foreign equipments，further prove that their production line isn't "fully domestic"

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That's not what was claimed. The claim was that they have 1 fully domestic production line. They should only more than 1 production line.

Interestingly enough, looks like domestic firms winning 28 out of 40 machines this week with NAURA winning a lot.

Just looking at this, it seems like Japan sanctioning China would be a bigger issue than the Dutch not allowing latest DUVi to be exported to China. They supply so many areas that was previously supplied by American firms.

FairAndUnbiased said:

What equipment does Korea produce that China does not?

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Pretty sure I've seen Korean firms winning in these bids, so I'm assuming they have at least a couple of areas ahead of China.

tphuang said:

That's where the government subsidies for domestic tools come into play. The big issue with Chinese tools industry isn't the lack of desire for domestic foundries to use them, but rather lack of production capacity. You can only increase head count and production so much. It takes a lot of time to validate new tools with customers in their production process. These things don't happen overnight.

I mean the domestic firms are now winning 60% of bids normally. That's pretty good for 3 months after the October surprise.

That's not what was claimed. The claim was that they have 1 fully domestic production line. They should only more than 1 production line.

Interestingly enough, looks like domestic firms winning 28 out of 40 machines this week with NAURA winning a lot.

Just looking at this, it seems like Japan sanctioning China would be a bigger issue than the Dutch not allowing latest DUVi to be exported to China. They supply so many areas that was previously supplied by American firms.

Pretty sure I've seen Korean firms winning in these bids, so I'm assuming they have at least a couple of areas ahead of China.

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I know that there are Korean companies importing domestic equipment to their own fabs, but not aware of what specific areas they're better than Chinese equipment in.

tphuang said:

In general, I feel like he is very reluctant to talk about progress outside of SMEE and ICRD, since he is mostly familiar with the work they are doing with ICRD. Again, that's why I think DUVi will get validated on SMIC first.

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That's fair of him, ICRD validation is a completely different exercise that may be beyond his expertise at SMEE. Let's not forget that we aren't just validating individual equipments performance and ability to meet requirements, but their ability to work in tandem as part of a complex process. Wafer processing involves many steps and equipment, which can take several months to complete. So even if everything works smoothly or good enough in the first go it will be several months before they give the greenlight. If anything is off, depending on how robustly they want it to work they have to go back and redo that validation or portions of it which will take additional time. While I think 2-3 years would be a conservative estimate, I think it would be reasonable that if the HVM DUVi prototype is available in H1 2023 then the process validation using it will take us to the end of the year and if all good mass production rolls out starting 2024. Also, if they change any of the inputs/variables in the process (i.e., different equipment) they have to do it all over again, so if some of those elements are suboptimal now there is a choice that has to be made regarding whether to wait or go for it.

tonyget said:

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latest bidding info，YanDong still buying foreign equipments，further prove that their production line isn't "fully domestic"

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I've tried to translate somehow, can you please confirm winning bids this week are all from Chinese manufacturers and just few Japanese ones?

It seems to me Chinese local equipment manufacturers (at least for public tenders) are already well above 50% of market share...and very quickly moving to 60-70%

paiemon said:

That's fair of him, ICRD validation is a completely different exercise that may be beyond his expertise at SMEE. Let's not forget that we aren't just validating individual equipments performance and ability to meet requirements, but their ability to work in tandem as part of a complex process. Wafer processing involves many steps and equipment, which can take several months to complete. So even if everything works smoothly or good enough in the first go it will be several months before they give the greenlight. If anything is off, depending on how robustly they want it to work they have to go back and redo that validation or portions of it which will take additional time. While I think 2-3 years would be a conservative estimate, I think it would be reasonable that if the HVM DUVi prototype is available in H1 2023 then the process validation using it will take us to the end of the year and if all good mass production rolls out starting 2024. Also, if they change any of the inputs/variables in the process (i.e., different equipment) they have to do it all over again, so if some of those elements are suboptimal now there is a choice that has to be made regarding whether to wait or go for it.

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As I’ve been saying for a few years now, people shouldn’t expect aggressive schedules for process integration. That stuff takes a lot of time to get right. Once you have the equipment you can always try to fast track process integration and take a penalty in cost and efficiency, but if you don’t absolutely need to why take the penalties of doing something disruptive if taking your time is an option? (And yes, China taking its time *is* still an option because all these bans for the most part aren’t hurting present production nearly as much as future production. The equipment China already received doesn’t just disappear with bans).