All Players Aiming for Shipment Increase in 2H21
The author is an analyst of NH Investment & Securities. He can be reached at kyuha.lee@nhqv.com. -- Ed.
Taiwanese media have recently mentioned that semiconductor design companies are likely to enjoy sales increase of at least 10% q-q in 3Q21 on expanded smartphone shipments in Greater China. Believing that shipments will recover in earnest in 2H21, we expect related firms to benefit.
Global smartphone shipments to rebound in 2H21
Recently, Taiwanese media have mentioned that chip demand for 5G smartphones is growing again. We primarily attribute this development to expanding 5G smartphone shipments by Chinese smartphone makers in 2H21. In addition, as the iPhone 13 series (scheduled for release in 2H21) should see robust shipments and demand, we expect SEMCO and LG Innotek to benefit.
Taiwanese semiconductor chip design firms say that they expect sales growth of at least 10% q-q in 3Q21. In 2Q21, smartphone shipments were slower than forecast due to the impact of semiconductor shortages and the global re-spreading of Covid-19. But, both demand and shipments are now recovering, as the spread of Covid-19 in major markets, including India, has eased.
In China, the smartphone shipments of Chinese companies are also improving, with smartphone demand recovering around the 618 Festival. In particular, it is expected that Xiaomi will start shipping smartphones in earnest in 2H21 to capture Huawei’s market share.
All players aiming for smartphone shipment increase in 2H21
Unlike in 1H21, when shipments were slower than expected, major global smartphone makers are anticipated to employ a variety of methods in 2H21 to stimulate demand in a bid to secure greater market share.
In an effort to strengthen its presence in the related market, Samsung Electronics is predicted to cut the price of foldable smartphones in its flagship line. Meanwhile, Apple is to focus on securing Huawei’s flagship market share in China and Europe. In 2H21, Chinese firms are expected to roll out low-end 5G smartphones in earnest.
As demand for general-purpose parts such as MLCCs and PI materials is poised to accelerate, related companies look well-positioned to benefit. With Apple’s shipments set to pick up, domestic component makers such as LG Innotek, BH, ITM Semiconductor, and Derkwoo Electronics deserve attention.