Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Thematic (Sector/Industry)

<ul>
<li>Wafer demand in 2023 has fallen to just 86% of global capacity, the lowest in a decade</li>
<li>Demand for Epitaxial wafers (used for Logic) is not going to recover until EOY'23. Demand for Polished wafers (used for Memory) will likely take until H2'24 to recover</li>
<li>It could potentially take until 2026 for supply and demand to return to balance. </li>
</ul>


Wafer demand in 2023 has fallen to just 86% of global capacity, the lowest in a decade
Demand for Epitaxial wafers (used for Logic) is not going to recover until EOY'23. Demand for Polished wafers (used for Memory) will likely take until H2'24 to recover
It could potentially take until 2026 for supply and demand to return to balance. 


Japan Specialist

Mark Chadwick

<ul>
<li>OVERSEAS.  Choppy Session with SPX closing -0.2%;  Tech down again as reversal continues;  US 2Yr yield back above 4%, Alibaba +14% split to unlock value; Micron after hours-worst over?</li>
<li>JAPAN. NKY Futs -1.0% vs Cash; USDJPY 130.9; US-Japan strikes deal on EV battery materials Under IRA; Japan's FTA fine with MSFT-ATVI, -ve Sony; Alibaba Split +ve Softbank</li>
<li>NUGGET. Panasonic - Potential beneficiary of new IRA related deal with the US. Could see IRA EV tax credit rise from ¥172bn/year to ¥228bn/year.</li>
</ul>


OVERSEAS.  Choppy Session with SPX closing -0.2%;  Tech down again as reversal continues;  US 2Yr yield back above 4%, Alibaba +14% split to unlock value; Micron after hours-worst over?
JAPAN. NKY Futs -1.0% vs Cash; USDJPY 130.9; US-Japan strikes deal on EV battery materials Under IRA; Japan's FTA fine with MSFT-ATVI, -ve Sony; Alibaba Split +ve Softbank
NUGGET. Panasonic - Potential beneficiary of new IRA related deal with the US. Could see IRA EV tax credit rise from ¥172bn/year to ¥228bn/year.


Good Morning Japan |Choppy Equities; Weak Tech; NUGGET: Panasonic-New US Tax Credit Opportunity?

<ul>
<li>OVERSEAS. Crisis Over !Bailouts from US to Europe, Stocks rally as Contagion fears wane; Major Banks rescue First Republic Bank; Swiss Central Bank protects Credit Suisse; ECB raises by 50bps</li>
<li>JAPAN. NKY Futs flat vs Cash; USDJPY 133.8; Expect Japan Equities to start the road to recovery with macro fears subsiding;  Japan-Korea move fwd on trade/security. </li>
<li>NUGGET. Orix - one of the Biggest Renewables Plays in Japan. Riding the Decarbonization MegaTrend</li>
</ul>


OVERSEAS. Crisis Over !Bailouts from US to Europe, Stocks rally as Contagion fears wane; Major Banks rescue First Republic Bank; Swiss Central Bank protects Credit Suisse; ECB raises by 50bps
JAPAN. NKY Futs flat vs Cash; USDJPY 133.8; Expect Japan Equities to start the road to recovery with macro fears subsiding;  Japan-Korea move fwd on trade/security. 
NUGGET. Orix - one of the Biggest Renewables Plays in Japan. Riding the Decarbonization MegaTrend


Good Morning Japan |VICTORY Declared as Bailouts Rule; NUGGET: ORIX-Riding the Zero-Carbon MegaTrend

<ul>
<li>Worldwide silicon wafer shipments declined ~4% sequentially in Q4 2022. We anticipate a further 10% sequential decline in area shipments in Q1 2023</li>
<li>For 2023, we expect wafer shipments to decline by around 5% YoY with weakness in H1 offset by strength in demand in H2.</li>
<li>Despite the decline in area shipments, we expect the sector to remain strongly profitable, bolstered by the impact of Long Term Agreements and customer prepayments. </li>
</ul>


Worldwide silicon wafer shipments declined ~4% sequentially in Q4 2022. We anticipate a further 10% sequential decline in area shipments in Q1 2023
For 2023, we expect wafer shipments to decline by around 5% YoY with weakness in H1 offset by strength in demand in H2.
Despite the decline in area shipments, we expect the sector to remain strongly profitable, bolstered by the impact of Long Term Agreements and customer prepayments. 


Semiconductor Silicon Wafers Segment Q4 2022 Roundup & 2023 Outlook

<ul>
<li>Global markets continued positive momentum on peaking in global inflation and expectations that the rate hike cycle is approaching its end</li>
<li>There is a slew of economic data next week and some major US tech company results announcements. Japanese earnings announcements get into full swing</li>
<li>Suzuki was the start performer last week as investors cheered the company's new mid-term strategy and decarbonization plans</li>
</ul>


Global markets continued positive momentum on peaking in global inflation and expectations that the rate hike cycle is approaching its end
There is a slew of economic data next week and some major US tech company results announcements. Japanese earnings announcements get into full swing
Suzuki was the start performer last week as investors cheered the company's new mid-term strategy and decarbonization plans


Japan Weekly | Bullish Markets, Suzuki, Shin-Etsu

Japan

Shin-Etsu Chemical Co., Ltd. produces and distributes synthetic resins and other chemical products such as fertilizers. The Company also manufactures electronic materials such as semiconductor silicon, synthetic, and rare earth quartz. Shin-Etsu Chemical operates in Japan and overseas.

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Shin Etsu Chemical (4063 JP)

Silicon Wafers Imminent Capacity Glut

Wafer demand in 2023 has fallen to just 86% of global capacity, lowest in a decade. It could take until 2026 for global supply and demand to return...

William Keating

Good Morning Japan |Choppy Equities; Weak Tech; NUGGET: Panasonic-New US Tax Credit Opportunity?

US Markets Choppy; Tech down again; Japan set to approve 114trill budget; US-Japan strikes deal on EV battery materials Under IRA; Japan's FTA fine...

Mark Chadwick

Good Morning Japan |VICTORY Declared as Bailouts Rule; NUGGET: ORIX-Riding the Zero-Carbon MegaTrend

Expect Japan Equities to start the road to recovery with macro fears subsiding; Japan-Korea move fwd on trade/security. NUGGET: Orix - as a...

Mark Chadwick

Semiconductor Silicon Wafers Segment Q4 2022 Roundup & 2023 Outlook

Despite the anticipated 5% YoY decline in wafer area shipments, we expect the sector to remain strongly profitable, bolstered by the impact of Long...

William Keating

Japan Weekly | Bullish Markets, Suzuki, Shin-Etsu

Global stocks remain on an uptrend. Japanese stocks were in the green for the third week running. We highlight the stocks that impacted the market...

Mark Chadwick

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