Macquarie has pinpointed two Chinese semiconductor equipment manufacturers as the principal beneficiaries of a planned capacity expansion by Yangtze Memory Technologies Co. (YMTC), according to a research note published Wednesday.
Reporting on YMTC's expansion plans, Reuters said the NAND memory specialist intends to bring two extra fabs online, each configured to produce 100,000 wafers per month. At present YMTC operates two fabrication plants with a combined output of 200,000 wafers a month, and a third facility that is expected to add 50,000 wafers per month by 2027.
Macquarie noted that when these new facilities are fully operational, YMTC would have the largest NAND wafer capacity globally. The firm also highlighted that YMTC's main addressable market is likely to remain within China given the company's placement on the US entity list.
Across its first three development phases YMTC has invested in excess of 270 billion yuan. Macquarie projects that the two additional fabs will require between 160 billion and 180 billion yuan of further capital expenditure over the coming years.
For Phase 3 equipment installation currently underway, Reuters reported that more than half of the production tools have been sourced from local suppliers. That local sourcing dynamic is central to the beneficiaries identified by Macquarie.
Macquarie named SSE:AMEC and SZSE:NAURA as the key companies positioned to capture incremental equipment demand. Citing Gartner data, the research note observed that 75% to 80% of total capex in China's semiconductor buildouts is directed to semiconductor production equipment. Within that equipment spend, etching represents roughly 26% and deposition about 23%.
AMEC is identified as a leader in etching equipment, and Macquarie described etching as one of the most critical steps in 3D NAND production, making AMEC a primary beneficiary of the expansion. NAURA, which offers equipment across deposition, etching and cleaning processes, is expected to capture a share of the additional capex tied to the larger manufacturing footprint.
Impacted sectors
- Semiconductor equipment manufacturing
- Memory chip production
- Capital goods and industrial suppliers within China