Since September 24th, the market has been operating for a full calendar month, during which the index has fluctuated and broken upward, with market activity continuously increasing. At the same time, multiple industry sectors have taken turns to rise, with semiconductors, for instance, achieving absolute leadership in the upward trend.
Recently, there has been a continuous emergence of stimulating factors for the semiconductor industry, such as macroeconomic policies, technological changes within the industry, and overall improvements in the operational fundamentals. Against this backdrop, institutions have also expressed their continued bullish outlook on the future of semiconductors.
Semiconductors Lead the Market with the Highest Increase in the Past Month
Many benchmark stocks have doubled in value.
In this bull market, the performance of semiconductors can be described as leading the pack. According to statistical data, from September 24th to October 25th, among the more than 130 secondary industries in the Shenwan classification, semiconductors ranked first with a 67.69% increase. As of the close on October 25th, the total market value of the Shenwan semiconductor sector has reached 4 trillion yuan, a significant increase from the approximately 2.5 trillion yuan a month ago.
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Looking at individual stocks, from September 24th to October 25th, many semiconductor benchmarks have doubled in value. According to incomplete statistics, out of 159 semiconductor benchmarks, 13 have doubled in value, such as Hualin Shares, Fulede, Taiji Shares, Guomin Technology, Kema Technology, etc. Among them, Hualin Shares, listed on the Beijing Stock Exchange, led the increase with a 447.98% gain.
Hualin Shares' main business is integrated circuit testing, and during the period of strong stock price increases, its trading volume has continued to increase, such as from October 22nd to October 25th, all exceeding 1 billion yuan.
In addition, from September 24th to October 25th, there were also many stocks with gains exceeding 70%, and some benchmarks even set historical highs.
Overall, behind the strong leadership of semiconductors, there may be a connection with multiple factors such as the recovery of the secondary market, policy-driven factors, industry benefits, and positive fundamentals.
From the perspective of the secondary market, behind the rise of semiconductors, the market's bullish trend is evident, with active trading. In terms of transaction volume, from September 25th to October 25th, the transaction volume of the entire A-share market has been above 1 trillion yuan for 18 consecutive trading days. It is worth mentioning that in every bull market, semiconductors often become the leading sector.Policy-side benefits. As an important part of new quality productive forces, semiconductor-friendly policies are being rolled out intensively. In the second half of this year, multiple cities such as Shanghai, Beijing, and Wuhan have established government-led semiconductor industry investment funds, many of which also have leading companies in various semiconductor fields. In early September, the Ministry of Industry and Information Technology officially announced the promotion of "domestic photolithography machines with a resolution ≤65nm and overlay ≤8nm."
Furthermore, on October 21st, the "Guangdong Province Action Plan for Accelerating the Innovative Development of Optoelectronic Chip Industry (2024-2030)" was issued, setting a clear goal to achieve more than 10 breakthroughs in key core technologies in the field of optoelectronic chips by 2030. Optoelectronic chips are fundamental components for the conversion of optical and electrical signals and have a positive promoting effect on new generations of network communications, artificial intelligence, and intelligent connected vehicles.
Recently, some optoelectronic chip concept stocks have shown strong leadership, such as Changguang Huaxin and Yuanjie Technology. Changguang Huaxin stated that the company has formed a comprehensive and rich matrix of communication optoelectronic chip products, which can meet the demand for ultra-large capacity data communication; Yuanjie Technology claimed that the company's 100G PAM4 EML optoelectronic chip developed for high-speed optical modules is currently being tested by clients, and the testing process is in line with expectations. Both companies' stock prices have recently reached new highs, such as Yuanjie Technology's stock price setting a new high in the past six months on October 24th.
The semiconductor market demand side is looking up. According to data from the Semiconductor Industry Association, global semiconductor sales in August 2024 reached $53.12 billion, a year-on-year increase of 20.6%, and a month-on-month increase of 3.5%, setting a new historical high for monthly sales.
Semiconductor Q3 reports are generally positive
Many targets have achieved double-digit growth in performance
Behind the leading stock prices of semiconductor companies is the overall positive performance of the latest Q3 reports.
According to incomplete statistics, 48 semiconductor companies have disclosed their Q3 reports, with 32 of them achieving growth, accounting for nearly 70%. Among them, Changchuan Technology and Huiding Technology have both achieved growth rates of over 10 times, with Changchuan Technology's growth rate being the highest at 26858.78%, or 268 times. In terms of the secondary market, the company's stock price has increased by more than 60% since September 24th.
In addition, many semiconductor companies with high performance growth rates have also achieved strong leading stock price increases, involving chip design, semiconductor equipment, discrete devices, semiconductor materials, and other sub-segments.
At the same time, many companies have also disclosed their Q3 performance forecasts, which are also mostly expected to increase. Looking at the upper limit of the expected net profit increase, Northern Hua Chuang's net profit is expected to increase by the highest amount of 4.75 billion yuan.Overall, the performance growth of semiconductor companies has largely benefited from favorable market demand and increased business order volumes. Additionally, the positive fundamentals of the semiconductor industry are reflected in the expansion efforts of related listed companies. For instance, on October 24, Suzhou Shengyi Electronics (Shanghai) Co., Ltd. announced its intention to invest 4.3 billion yuan in a new high-end printed circuit board expansion project for artificial intelligence chips. According to its recently released performance report, the net profit attributable to the parent company for the first three quarters was 1.848 billion yuan, a year-on-year increase of 93.94%. The company stated that the expected increase in performance is related to the structural demand for printed circuit boards in emerging computing scenarios such as high-speed computing servers and artificial intelligence.
The net value of semiconductor funds has increased overall, and fund managers are optimistic about future market opportunities. Behind the leading stock prices and positive fundamentals of semiconductor companies, investors who have positioned themselves in the sector have reaped significant benefits. For example, with the start of this bull market, the net value of many semiconductor-themed public funds has seen a significant rebound.
Furthermore, looking at the latest third-quarter reports disclosed by public funds, there has been an overall active strategy in positioning semiconductor companies, which are precisely the leading targets in the semiconductor field. At the same time, fund managers generally hold an optimistic view on the investment opportunities in semiconductors going forward.
Taking the Bosera Semiconductor Theme Fund as an example, as of the end of the third quarter this year, the fund's top ten heavy positions included companies such as Will Semiconductor Co., Ltd., GigaDevice Semiconductor (Beijing) Inc., and Semiconductor Manufacturing International Corporation (SMIC).
In conjunction with the secondary market, the aforementioned semiconductor targets have performed well in the third quarter of this year. Additionally, since entering the fourth quarter, many of these targets have continued to show a strong rebound, such as SMIC (688981), which has risen by more than 50% since the beginning of the fourth quarter. The rebound of the held targets has led to a recovery in the net value of the funds, such as the Bosera Semiconductor Theme Fund, which has seen a net value increase of over 30% in the past six months.
In the third-quarter report, Bosera Semiconductor stated that it will continue to overweight consumer electronics chip design and domestic semiconductor equipment industries in the fourth quarter, as well as overweight the domestic artificial intelligence computing chip industry.
Another semiconductor-themed fund, such as the Debon Semiconductor Industry Fund, has also seen a net value rebound of over 30% in the past six months. The third-quarter report shows that the fund holds semiconductor targets such as Cambricon and Hygon Information Technology Co., Ltd.Regarding investment opportunities in the later market, Debon Semiconductor Industry stated in its third-quarter report that it made some adjustments to its position allocation in the third quarter this year, focusing its product holdings on companies related to consumer chips and assets related to computing power. Currently, it still maintains an optimistic outlook for these two areas. It also expressed that it remains quite optimistic about the recovery of the entire semiconductor industry, which has entered a trend of moderate growth. Especially with the overall market recovery, the technology sector, led by semiconductors, will greatly benefit from the valuation premium brought about by the market recovery.