To Introduce 24 EUV Systems for KRW4.8tn
The author is an analyst of NH Investment & Securities. He can be reached at hwdoh@nhqv.com. -- Ed.
SK Hynix has signed a W4.8tn-worth contract with ASML to procure EUV equipment. We believe that the company’s decision demonstrates rising demand for EUV systems, which is likely to benefit related equipment makers moving ahead.
To introduce about 24 EUV systems over next five years
On Feb 24, SK Hynix announced that it has signed a five-year-long contract worth W4.8tn with ASML to secure EUV machines. Related payments are likely to be made for each individual acquisition of equipment. Considering EUV equipment prices per unit, we expect the company to acquire around 24 EUV machines over the next five years.
SK Hynix plans to begin production of 1anm products at its M16 fab from 2H21, with EUV lithography to be applied to some layers. The chipmaker expects a 20% cut in production costs when conducting via hole patterning with EUV. An additional 3% cost cut looks possible if EUV is applied to more layers.
SK Hynix’s EUV investment positive for semicon equipment sector
SK Hynix’s aggressive investment in EUV technology bodes well for the semicon equipment sector. The firm’s move, however, stands in stark contrast to rival Micron’s decision to continue using multi-patterning technology and forgo adoption of expensive EUV technology (for up to the 1bnm process), a choice which has allowed Micron to both boost the operational efficiency of its fabs and optimize production costs. We note that Micron appears to have made significant progress towards the development of 1anm products. Against this backdrop, doubts have recently been raised over the benefits of EUV.
Meanwhile, for the time being, SK Hynix is unlikely to use pellicles for its DRAM EUV process. According to the company, due to long scanner exposure durations, the use of pellicles in DRAM manufacturing would likely result in a significant decline in scanner throughput. For reference, pellicles showing a light transmittance rate of 88% are estimated to reduce scanner throughput by 25%. In addition, the effectiveness of pellicles is relatively less for DRAM, as unlike logic chips, DRAM is fairly insulated from defective elements thanks to built-in error correcting code (ECC). However, the absence of pellicle-protected EUV masks means more testing/inspection to identify mask defects. Considering the above, we believe that related beneficiaries will include ASML (EUV maker) and Lasertec (inspection system manufacturer).