Summary of Semiconductor Industry Conference Call Industry Overview - **Industry**: Semiconductor Industry in Greater China - **Key Metrics**: - IC import/export value increased by +14.1% YoY and +32.7% YoY respectively in September 2025 [1][10] - IC import volume rose by +11.7% YoY in September 2025, compared to +2.1% YoY in August 2025 [1] - IC production growth was +3.2% YoY in August 2025, down from +15.0% YoY in July 2025 [4][12] Core Insights - **Demand Trends**: - The semiconductor demand in the China market is increasing, supported by advancements in generative AI and automotive technologies [2][4] - Positive growth in IC production and import values indicates a recovery trend in the semiconductor sector [4][21] - **Production and Inventory**: - China's electronics sector had an average of 58 days of inventory in August 2025, lower than previous years (67/57/60 days in August 2024/2023/2022) [23] - The production volume of ICs was 43 billion units in August 2025, reflecting a month-over-month decline of -9.4% [4][12] Financial Performance - **Revenue Growth**: - Total semiconductor revenues in August 2025 were up 13.9% YoY to US$17.6 billion, compared to +12.0% YoY in July 2025 [5][21] - Taiwan's semiconductor revenue grew by +23.8% YoY in September 2025 [5][31] - **Investment Recommendations**: - Companies recommended for investment include Kematek, SMIC, Hua Hong, AMEC, and others, indicating a bullish outlook on these stocks [3] Additional Insights - **Equipment Imports**: - SPE (semiconductor production equipment) import value increased by +8.3% YoY in August 2025, while semiconductor test equipment imports saw a significant decline of -41.3% YoY [9][25][36] - Lithography machine imports showed a decrease in volume (-2% YoY) but an increase in average selling price (+57% YoY) [34][39] - **Bidding Activity**: - Continuous bidding activity from semiconductor manufacturers in China suggests an upward trend in capital expenditures, with several companies placing orders for advanced manufacturing equipment [11][42] Conclusion - The semiconductor industry in Greater China is experiencing a positive growth trajectory, driven by technological advancements and increasing demand. The financial performance of key players is robust, with significant year-over-year revenue growth. Investment in specific companies is recommended based on their strong market positions and growth potential.

Core Viewpoint - The A-share market shows a mixed opening with a slight upward trend in major indices, supported by the central bank's monetary policy and economic recovery expectations, despite short-term uncertainties due to geopolitical tensions [1]. Market Performance - As of 9:51 AM, the Shanghai Composite Index rose by 0.09%, the Shenzhen Component Index increased by 0.35%, and the ChiNext Index gained 0.48% [1]. - Key sectors showing strong performance include EDA, brain-computer interfaces, and photolithography equipment, with notable stocks like Haoshanghao and Zhongci Electronics hitting the daily limit [1]. Sector Analysis Brain-Computer Interface (BCI) - The BCI sector is experiencing significant momentum, with companies like Jihua Group and Xiangyu Medical seeing substantial gains. The technology is nearing a critical point for industrialization, driven by breakthroughs and clinical validations [2]. Photolithography Equipment - Stocks in the photolithography equipment sector are performing well, with companies like Blue Ying Equipment and Kai Mei Teqi reaching their daily limits. This sector is crucial for semiconductor manufacturing, and demand in mainland China is expected to remain strong as local wafer fabs continue to expand [3]. Institutional Insights - CITIC Securities suggests that structural opportunities will dominate the market, with potential catalysts from unexpected interest rate cuts by the Federal Reserve and concurrent easing by the People's Bank of China [4]. - Guotai Junan Securities indicates that the market still has upward potential before the end of July, driven by internal innovation and a decrease in market discount rates [5]. - Zhejiang Securities notes that mid-cap growth stocks may outperform small-cap stocks due to current market conditions, with increased volatility expected in July [6][7].