SMIC(SH:688981) EBSCN·2025-04-13 09:15Investment Rating - The report assigns a "Buy" rating for the semiconductor industry, indicating an expected investment return exceeding 15% over the next 6-12 months [6]. Core Insights - The ongoing high tariffs between the US and China are accelerating domestic substitution in the semiconductor industry, particularly benefiting sectors such as simulation, RF, and mature process foundries [3]. - The new origin certification rules in China are likely to disadvantage US IDM manufacturers, enhancing the competitive edge of domestic CPU, storage, simulation, RF, and power manufacturers [3]. - The US's exemption policy for certain products, including smartphones and computers, is expected to alleviate the impact of tariffs on technology companies and consumers [2]. Summary by Sections Tariff Impact - The US has significantly increased tariffs on Chinese imports, with rates reaching as high as 125%, prompting reciprocal actions from China [1]. - The escalating tariff situation is expected to create structural opportunities for Chinese semiconductor manufacturers as US firms face increased costs [3]. Origin Certification Changes - China's semiconductor industry association has clarified that the origin of integrated circuits will be determined by the wafer fabrication location rather than the packaging location, which may reduce the competitiveness of US IDM firms [3]. - This change is anticipated to disrupt the US strategy of bringing chip manufacturing back to the US, benefiting Chinese mature process foundries [3]. Investment Recommendations - The report suggests that sustained high tariffs will drive accelerated domestic substitution in the semiconductor sector, particularly for simulation, RF, storage, and CPU manufacturers [3]. - Foundries like Huahong Semiconductor (1347.HK) and SMIC (0981.HK) are expected to benefit from increased demand for mature processes as domestic manufacturers seek to mitigate tariff impacts [3].