Orient Securities·2025-07-07 02:14Investment Rating - The industry investment rating is maintained as "Positive" [4] Core Viewpoints - The expansion of advanced storage and logic capacity in China is expected to continue driving demand for semiconductor equipment, with uncertainties arising from geopolitical factors, tariff fluctuations, and export controls potentially accelerating the domestic production process of semiconductor equipment [2][7] - The domestic semiconductor equipment sector is anticipated to benefit significantly from the ongoing advancements in high-end storage chips, as Chinese companies are gradually closing the gap with international leaders [7] Summary by Sections Investment Recommendations and Targets - The report suggests focusing on domestic semiconductor equipment companies, including: - Northern Huachuang (002371, Buy) - Shengmei Shanghai (688082, Buy) - Tuojing Technology (688072, Buy) - Zhongwei Company (688012, Buy) - Xinyuan Micro (688037, Buy) - Wanye Enterprise (600641, Hold) - Huahai Qingke (688120, Not Rated) - Jingzhida (688627, Not Rated) - Zhichun Technology (603690, Not Rated) - Saiteng Co., Ltd. (603283, Not Rated) - Jingce Electronics (300567, Buy) - Zhongke Feimiao (688361, Not Rated) [2] Market Trends and Data - In Q1 2025, the sales of semiconductor manufacturing equipment in mainland China reached $10.26 billion, reflecting a 14% quarter-on-quarter decline and an 18% year-on-year decline. However, the A-share semiconductor equipment sector reported a 39% year-on-year revenue growth to $18.9 billion, with net profit increasing by 38% to $2.8 billion, indicating a strong growth trend [7] - The Chinese wafer foundry industry is expected to maintain a capacity expansion trend, with capital expenditure needs anticipated to remain strong over the long term. By 2024, mainland China is projected to hold a 21% share of global foundry capacity, second only to Taiwan [7] - Domestic advanced storage continues to make breakthroughs, with companies like Yangtze Memory Technologies achieving significant advancements in high-end storage chip technology, which is expected to drive rapid growth in upstream equipment demand [7]