Shenwan Hongyuan Securities·2025-06-30 13:12Investment Rating - The investment rating for the electronic industry is "Positive" [2][5]. Core Views - The report highlights the continuous growth in the electronic industry for Q2 2025, focusing on price increase logic and domestic substitution [2]. - Advanced process manufacturing in China is expected to reshape the global semiconductor landscape, with domestic fabs closing the technology gap [2]. - The report anticipates significant revenue growth for various companies, driven by advancements in storage technology and increased demand for AI and cloud computing [2]. Summary by Sections Advanced Process Manufacturing - China has made progress in advanced process manufacturing, with domestic fabs narrowing the technology gap, particularly in GPU development [2]. - SMIC is projected to achieve a net profit of 1.5 billion yuan in Q2 2025, representing a year-on-year increase of 32% [2]. Storage - Major global manufacturers are transitioning from DDR4 to advanced process products, leading to a significant increase in DDR4 spot prices [2]. - Price increases for DDR4 modules are expected to be 13-18% for PCs and 18-23% for servers in Q2 2025, with further increases anticipated in Q3 [2]. - Companies like Zhaoyi Innovation are expected to benefit from this transition, with projected revenue growth of 51% year-on-year and net profit growth of 90% [2]. Semiconductor Equipment - The demand for advanced process manufacturing is driving growth in orders for domestic semiconductor equipment manufacturers, with North China Innovation expected to reach 10 billion yuan in revenue for Q2 2025, a 54% year-on-year increase [2]. - The acquisition of Chip Source Micro by North China Innovation is expected to accelerate the pace of mergers and acquisitions in the semiconductor equipment sector [2]. Intelligent Driving - The penetration rate of L2++ autonomous driving has exceeded expectations, with a reported 60.94% penetration rate for L2 and above in early 2025 [2]. - Companies like Weir Shares and SiTwi are projected to see net profit increases of 30% and 55% respectively in Q2 2025 [2]. Computing Power - Global cloud service providers' capital expenditures reached 90.9 billion USD in Q1 2025, a 21% year-on-year increase, indicating strong demand in the sector [2]. - Shenghong Technology and Shengyi Electronics are expected to report net profits of 1 billion yuan and 280 million yuan respectively, with growth rates exceeding 300% [2]. Power Devices - The second quarter is expected to see an upward trend in the power device sector, with companies like Yangjie Technology projected to achieve revenues of over 1.8 billion yuan [2]. Analog Devices - The second quarter shows positive trends, with companies like Naxin Micro expected to see a 10% increase in revenue [2]. Display - The exit of Korean and Japanese manufacturers from the market is creating investment opportunities, with LG Display and Sharp planning to close production facilities [2]. Key Investment Recommendations - Recommended stocks include Zhaoyi Innovation and Baiwei Storage in the storage sector, Weir Shares and SiTwi in intelligent driving, and SMIC and North China Innovation in semiconductor domestic substitution [2].