| To: slacker711 who wrote (10378) | 8/10/2021 7:38:06 PM | | From: EvanG | | | | A Mega Fab with a monthly output of 30,000 6-inch silicon carbide wafers is now complete and is ready for production.
Apparently it is 15,000 wafers/month capable. Not 30,000 wafers/month and they can't say if they are selling any. At a $2.5 billion cost, wondering how this is low cost.
compoundsemiconductor.net
In June this year, China-based Hunan Sanan Semiconductor opened the nation's first vertically integrated SiC line. Located in the Changsha high-tech industrial park, the $2.5 billion investment has, so far, taken less than a year to build and handles all wafer and device fabrication steps from crystal growth to power devices, packaging and testing.
“This is phase 1 of our site,” highlights Mrinal Das, Director, Technical Marketing and Sales at Sanan IC, which alongside Hunan Sanan, is a subsidiary of Sanan Optoelectronics. “At 15,000 wafers a month, we've brought half of its full capacity online... In phase 2 we will [build] a mirror image of phase one.”
“We have an aggressive plan to get the plant fully operational - meaning equipped to deliver 30,000 wafers a month by 2024,” he adds.
From here on in, Hunan Sanan's Changsha megafab will be delivering a mix of wafers and devices to Sanan IC, as well as other domestic and international customers. Describing the site as Sanan IC's 'captive' wide bandgap power semiconductor facility, Das won't be drawn on actually supply figures right now other than to say the facility is '15K a month capable'.
Currently built to churn out six inch SiC wafers, Das also expects to see eight inch wafers being produced come 2024. As he puts it: “My vision is that during phase 2, if there is enough demand, we will work on 8 inch wafers so that in 2024 we could probably [be producing] 15,000 six inch and 15,000 eight inch wafers.”
“After that, and if demand continues to rise in the next five to ten years, we will [scale] phase one and move to 30,000 eight inch wafers every month,” he says. “Our crystal growth team has put a lot of effort into our [wafer] technology and we have a lot of innovation through our patent filings in China and the US.”
Indeed, Sanan IC has been manufacturing SiC Schottky diodes for some time now and also has SiC MOSFETs under qualification - 1200 V devices are scheduled to be released soon. According to the Sanan IC Director, the figure of merits for substrates, epitaxy and devices are all 'achieving parity' with industry-best technology.
Das is also keen to emphasize that the organization also makes GaN-on-silicon devices for lower power applications. And as his Sanan IC colleague, Raymond Biagan, Senior Director, Sales and Marketing Communications - North America and Europe, highlights: “Our business model is to offer our entire manufacturing platform to the worldwide market.”
In the interim, Sanan Hunan will hire engineers locally and from further afield. “Engineers will predominantly come from a pool of domestic talent but there will also be a portion of technologists from Taiwan, China, Japan and internationally,” says Biagan.
Still, Sanan IC and Hunan Sanan are hardly operating in a vacuum. Recently, Cree, US, has poured $1 billion into its 200 mm SiC fabrication facility in Mohawk Valley, New York, while Rohm of Japan has just finished building its $190 million SiC wafer and device fab in Chikugo, Japan. US-based II-VI also intends to plough up to $50 million into its China SiC substrate manufacturing capacity and Infineon of Germany is set to increase SiC epitaxy wafer production.
However, Das - who worked at Cree and Wolfspeed for more than 16 years - reckons Sanan's China-based megafab gives the organisation an edge. “Wolfspeed, for example, has the biggest news on capacity expansion so far with their materials supply stretching from North Carolina to upstate New York, and with packaging typically at various Outsourced Semiconductor Assembly and Test companies across Asia,” he says.
“But while the company is vertically integrated there is still this logistical challenge of moving their product through various stages globally, whereas we have a nice, compact, single site that is doing everything,” he adds.
Both Das and Biagan believe the Changsha site also sets up their company to more easily target the all-important electric and hybrid electric vehicle markets, in China.
“Analysts indicate that the hockey stick for wide bandgap materials will be automotive markets so it's been natural to headquarter in China where we can cater for its large automotive market in terms of logistics and quick time to market.” says Biagan. “Our parent company is already a major supplier of LED car lamps to the automotive industry here, and we can further appeal to that marketplace by delivering SiC and GaN domestically.”
Das and Biagan are also confident the burgeoning SiC industry has enough room for everyone. According to Das, the only competitor for all SiC players is silicon, and he and colleagues at Sanan IC and Hunan Sanan hope to work alongside the competition to enable the widespread adoption of wide bandgap materials.
Still as Biagan puts it: “Our aspiration is to be considered a major market shareholder in the SiC space that is today served by companies such as Wolfspeed and STMicroelectronics, and to be known as a brand globally.” |
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| To: EvanG who wrote (10403) | 8/11/2021 7:12:36 AM | | From: slacker711 | | | | Apparently it is 15,000 wafers/month capable. Not 30,000 wafers/month and they can't say if they are selling any. At a $2.5 billion cost, wondering how this is low cost.
Subsidies from the state probably make it low cost to the company but you still need decent yields for the economics to work.
We are getting headlines about SiC capex plans almost every day but I'm not sure any of these new players are doing anything beyond shipping samples. The idea that a company is going to start shipping their first 6" wafers in '21 and then have commercial 8" wafers in '24 seems extremely unlikely. |
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| To: slacker711 who wrote (10402) | 8/12/2021 7:29:49 PM | | From: EvanG | | | | IIVI plans on investing $1 billion into SiC over the next ten years. That covers both capex and R&D.
II-VI had a conference call today. Clarified that the $1B included $200-$250 million in OPEX (a good portion manufacturing engineering and design for manufacturability) with the remainder in CAPEX mainly in a 3 year intensity with some followup in remaining years. |
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| From: slacker711 | 8/17/2021 7:16:43 PM | | | | | | Another earnings report.
Margins still suck.
Demand continues to inflect higher (capacity constrained in FY'22).
$1 billion in design ins in the quarter and $2.9 billion in the last year.
They are going to spend a billion dollars in capex total in fiscal years '21 and '22. That was supposed to be their expenditures over five years.
Market clearly in show-me mode.
investor.cree.com |
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| To: slacker711 who wrote (10407) | 8/17/2021 7:59:43 PM | | From: Lou Weed | | | | | I wonder if design in = design win? You can be designed in but not necessarily win all or any of that business, depending on your competition (new pricing, qualification issues with their part, delivery constraints etc.). Also, is that $1B over the life of the projects or from one year of revenue......lots of ???? |
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| To: Lou Weed who wrote (10408) | 8/18/2021 6:42:07 AM | | From: slacker711 | | | | I wonder if design in = design win? You can be designed in but not necessarily win all or any of that business, depending on your competition (new pricing, qualification issues with their part, delivery constraints etc.). Also, is that $1B over the life of the projects or from one year of revenue......lots of ????
Yeah, I don't understand why they don't use the word "design win" instead of "design in".
The revenue number is definitely uncertain. These are projections from the customer and they cover the life of the project. Some might ramp in a year but auto revs are 3-4 years out and that obviously means that the delta of any projections is large. The larger customers also might have an incentive to increase their projections so Cree will increase capacity which would serve them well.
All of that being said, they are winning business and the step up in design in activity bodes well for Cree's ability to transition into a vertically integrated component supplier.
Personally, I heard what I wanted from the call and the fact that the market is going to sell of anyway is a good thing. The valuation has sucked on Cree for a while but we might get prices that don't require substantial upside to the current '24 projections. |
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| To: slacker711 who wrote (10409) | 8/18/2021 9:01:31 AM | | From: Lou Weed | | | | | Yeah, - I'm guessing there's a suitor waiting in the wings for a more substantial drop to step in and make an offer. The valuation is still way too high. Lowe has been there what, 4 years now? I give him another 2 - 3 years at the most. It'll be taken out somewhere in that time frame IMO. |
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| To: slacker711 who wrote (10410) | 8/18/2021 10:43:42 AM | | From: OldAIMGuy | | | | Hi S, Re: Price Targets.........................
Those new guide prices are somewhat closer to what Value Line is showing for the 3-5 year time horizon.
Value Line Price Targets
3-5 Year Range - $35 to $55
Their write-up suggests the stock got way ahead of itself with the ~4X gains over the last year or so. Current Price/Book is 4.1. Selling off the lighting division forced VL to suspend their "timeliness" rank for now as they feel there won't be any useful year to year comparisons for a while.
I was selling into that strength so have a bunch of cash sidelined for share repurchases sometime in the future should it figure out how to make product and sell it at a profit.
There's now more cash in this sleeve than there was total investment back in 2014. It's over 50% of current account holding value.
Best wishes,
OAG |
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