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Amid recent market fluctuations, the semiconductor sector has risen again, attracting strong attention from investors.

In the morning session of August 13, Zhongjing Technology (003026.SZ) hit the daily limit and set a new high. Stocks such as Xinjie Energy (605111.SH), Liandong Technology (301369.SZ), and Jiejie Microelectric (300623.SZ) followed suit.

Against the backdrop of global economic recovery, the semiconductor industry seems to have ushered in a long-awaited spring. Many semiconductor companies may be at a turning point, with Will Semiconductor, Sinotek, New Clean Energy and other companies all announcing their expected performance increases in the first half of the year, confirming the positive trend of the industry gradually emerging from the trough and heading towards recovery.

Among them, Zhongjing Technology, located in Zhejiang, has continuously strengthened business expansion, improved product quality, and continued to increase R&D investment. The company expects to achieve a net profit attributable to the parent company of 10 million to 13 million yuan in the first half of the year, turning losses into profits year-on-year. The company's performance improvement expectations have been significantly strengthened.

The industry is recovering and performance is reaching a turning point

In 2024, the semiconductor industry will usher in many new changes.

According to statistics from the Semiconductor Industry Association (SIA), the global semiconductor industry sales in the second quarter of 2024 totaled US$149.9 billion, an increase of 18.3% year-on-year and 6.5% month-on-month. SIA said that the global semiconductor market achieved year-on-year growth every month in 2024.

According to a report released by the Semiconductor Industry Association (SEMI), global semiconductor equipment sales are expected to increase by 3.4% year-on-year to US$109 billion in 2024, surpassing the US$107.4 billion in 2022 to set a record high. At the same time, SEMI expects even stronger growth in 2025, which is expected to increase by 17% to US$128 billion.

Against this backdrop, the performance of domestic A-share semiconductor listed companies has also seen a recovery, especially for memory chip companies. As for the reasons for the expected increase in company performance, many chip companies mentioned factors such as "recovery of downstream demand" and "restorative growth in the industry", and many phenomena indicate that the semiconductor industry is continuing to pick up.

Zhongjing Technology, which is at the upstream of the semiconductor industry chain, has shown obvious signs of performance recovery. The company expects to achieve a net profit attributable to shareholders of 10 million to 13 million yuan in the first half of 2024, turning losses into profits year-on-year, which is a significant improvement over the same period in 2023.

In its performance forecast, Zhongjing Technology pointed out that the company attaches great importance to the expansion of various businesses and continuously improves its delivery capabilities to meet customer needs; at the same time, it improves product quality to further enhance its market competitive advantage; in terms of research and development, the company continues to increase investment, optimize production processes, and continuously develop new products.

The semiconductor industry, which has good fundamentals, has also received high attention from research institutions recently. Statistics show that since July, 55 A-share semiconductor listed companies have received intensive research from institutions. As a leader in semiconductor silicon wafers, Zhongjing Technology has also recently received research from domestic and foreign institutions such as Morgan Stanley Funds, Great Wall Securities, and Bank of Communications Schroder.

Institutions are generally more concerned about the sustainability of the company's performance improvement. Zhongjing Technology stated that the company's production and operations were positive in the first half of the year. In the second half of the year, it will continue to cultivate strategic customers, focus on high-quality customers, tap potential customers, continue to increase market development efforts, and increase the company's market scale.

Steady growth in all businesses

According to the official website, Zhongjing Technology is a national high-tech enterprise specializing in the research and development, production and sales of semiconductor monocrystalline silicon materials and their products. The company has core technologies and processes with independent intellectual property rights and is equipped with advanced production testing equipment and management systems.

According to the company's disclosure, Zhongjing Technology has now mastered the core technologies of many semiconductor silicon material manufacturing and processing technologies, including magnetron direct pulling (MCZ) crystal pulling technology, re-feeding direct pulling technology, diamond wire multi-wire cutting technology, high-precision heavy doping technology, high-efficiency heavily doped arsenic single crystal silicon growth technology, and high-precision polished silicon wafer processing technology. At the same time, it has many core technologies for chip manufacturing for power devices, such as the research and development and manufacturing of high-frequency and high-voltage diodes.

Through independent research and development and technological innovation, Zhongjing Technology has significantly improved the market competitiveness of its products while improving production efficiency and reducing labor costs, consolidating the company's leading position in the industry.

Zhongjing Technology has been deeply involved in the semiconductor silicon material industry for many years, always keeping up with market trends and customer needs, and actively seizing industry opportunities. In recent years, the company has continued to strengthen market development, expand business coverage, increase industrial scale, optimize resource allocation, and continuously accumulate development momentum.

After years of development, Sinotek has taken a leading market position in the fields of single crystal silicon rods, polished silicon wafers, and semiconductor power chips and devices for domestic discrete devices. With high-quality products and services, it has established a good reputation in the industry, established a sustained and stable cooperative relationship with many downstream customers, and has strong customer stickiness, creating a potential customer base and market opportunities for the company's future expansion of new businesses.

According to the company's disclosure, in 2023, Zhongjing Technology's semiconductor monocrystalline silicon wafers, monocrystalline silicon rods, semiconductor power chips and devices and other products brought the company operating income of 161 million yuan, 73.1574 million yuan and 111 million yuan, respectively, an increase of 4.53%, 10.68% and 2.07% over the same period last year. The development of various businesses is relatively balanced and the growth is relatively stable.

Expanding into high-end fields, the future is promising

It is worth mentioning that, based on its technological advantages in the fields of monocrystalline silicon and silicon wafer forming, Zhongjing Technology has continuously increased its efforts in technological development and product expansion for deep processing of products, and increased the optimization and improvement of new products, new technologies and new processes in the high-end discrete devices and integrated circuit segments.

It is reported that Zhongjing Technology's fundraising and investment project "Single Crystal Silicon Wafer Project for High-end Discrete Devices and Ultra-Large Scale Integrated Circuits" is progressing smoothly and is currently in a critical period of increasing production and new customer certification.

Zhongjing Technology stated that polished silicon wafer products will become one of the company's important main products in the future. The company will combine actual operating conditions, make orderly plans and arrangements based on existing production capacity, market demand, etc., and continue to promote the release of production capacity of the fundraising projects.

It should be noted that silicon wafers, as the most important component of semiconductor materials, also maintain a rapid growth in market size. In this context, Sinotek continues to expand into high-end fields. The single-crystal silicon wafers for high-end discrete devices produced by the fundraising project have a wide range of applications, including consumer electronics, household appliances, communications and security, green lighting and other fields.

In this project, Zhongjing Technology is dominated by its heavily doped series of single-crystal silicon wafer products, which have the advantages of ultra-low resistivity, low oxygen content and high geometric flatness. Therefore, its application range can be expanded to industrial fields such as clean energy and new energy vehicles.

Next, Zhongjing Technology will continue to promote the production and research and development of semiconductor single crystal silicon polishing wafers for high-end discrete devices and integrated circuits, further exert the company's core competitiveness, enhance the company's technological innovation capabilities, expand product application areas, and continuously consolidate the company's competitive advantages and market position.

From the perspective of market performance, Zhongjing Technology has accumulated a 64% increase since June, ranking first in the entire sector. On July 30, 31, August 2, and 9, Zhongjing Technology achieved multiple daily limits, and its stock price performance also indirectly showed the market's recognition of its fundamental improvement.

In the morning of August 13, Zhongjing Technology quickly hit the daily limit, setting a new intraday high. However, at 10:19, the stock opened the daily limit and then fluctuated at a high level. As of press time, Zhongjing Technology rose 8.99%. How much room for Zhongjing Technology to rise next? Welcome to leave a message to discuss.