Company Reports

National Silicon Industry Group's June-quarter revenue grew 38% year on year to CNY 1.23 billion, while gross margin was less bad at negative 5.3% as the firm shipped 90% more 300-millimeter wafers year over year. The 300 mm wafer average selling price fell 17%. Shares dropped 8% on Aug. 20.

National Silicon Industry Group's March quarter revenue grew 35% year on year to CNY 1.08 billion, while gross margin narrowed to negative 11.8% as the firm shipped 90% more 300mm wafers from the year-ago quarter.

National Silicon Industry Group is a Chinese up-and-coming semiconductor silicon wafer producer. Contrary to its larger peers, NSIG is unlikely to build new sites outside of China because of geopolitical risks and the incremental demand coming from Chinese customers. We expect NSIG to more than double its 300-millimeter wafer capacity by 2030, compared with end-2025 levels, partly fueled by China’s pursuit of a self-sufficient supply chain.

National Silicon Industry Group's December-quarter revenue grew 18% year-on-year to CNY 1.07 billion. However, gross margin worsened to minus 22.9% as depreciation continued to mount, and the firm has written off CNY 261 million in inventories.

National Silicon Industry Group's preliminary 2025 revenue increased 9.7% year on year to CNY 3.71 billion and net loss widened 52% to CNY 1.48 billion. Sales of 300-millimeter wafers grew 15% to CNY 2.4 billion via a 26% volume increase, partly offset by an 8.7% drop in average selling price.

National Silicon Industry Group's September quarter revenue grew 4% year on year to CNY 944 million driven by a 16% increase in 300mm wafer revenue, offset by a double-digit drop in 200mm wafer sales. However, gross margin worsened to negative 17.5% due to higher depreciation and lower prices.

National Silicon Industry Group agrees to buy minority interests of three indirect subsidiaries at CNY 324 million in cash and CNY 6.7 billion in new shares. Separately, NSIG will issue new shares worth up to CNY 2.1 billion for working capital. Both transactions are pending regulatory approval.

National Silicon Industry Group is a Chinese up-and-coming semiconductor silicon wafer producer. Contrary to its larger peers, NSIG is unlikely to build new sites outside of China because of geopolitical risks and the incremental demand coming from Chinese customers. We expect NSIG to triple its 300-millimeter wafer capacity by 2030, compared with end-2024 levels, partly fueled by China’s pursuit of a self-sufficient supply chain.

National Silicon Industry Group's June quarter revenue grew 6% year on year to CNY 896 million due to higher volumes and slightly better 200mm wafer prices. However, gross margin worsened to negative 14.6% as depreciation of its new 300mm silicon-on-insulator wafers site began.

National Silicon Industry Group's March-quarter revenue grew 11% year on year to CNY 802 million due to higher 300mm wafers sales. However, gross margin deteriorated to negative 11.4% on higher depreciation costs and lower wafer prices.

National Silicon Industry Group is a Chinese up-and-coming semiconductor silicon wafer producer. Contrary to its larger peers, NSIG is unlikely to build new sites outside of China because of geopolitical risks and the incremental demand coming from Chinese customers. We expect NSIG to triple its 300-millimeter wafer capacity by 2030, compared with end-2024 levels, partly fueled by China’s pursuit of a self-sufficient supply chain.

National Silicon Industry Group's preliminary December-quarter revenue was flat sequentially at CNY 909 million, 13% over our forecast as price cuts boosted market share. Price cuts, goodwill write-downs, and new site startup costs led to net loss doubling to CNY 434 million from the prior quarter.

National Silicon Industry Group plans to buy out minority interests of three indirect subsidiaries held through Zing Semiconductor. The transaction is pending regulatory approval and may be paid in cash or a share swap. Trading in the shares will be suspended by up to one week starting Feb. 24.

National Silicon Industry Group is a Chinese up-and-coming semiconductor silicon wafer producer. Contrary to its larger peers, NSIG is unlikely to build new sites outside of China because of geopolitical risks and the incremental demand coming from Chinese customers. We expect NSIG to triple its 300-millimeter wafer capacity by 2030, compared with end-2023 levels, partly fueled by China’s pursuit of a self-sufficient supply chain.

We keep our fair value estimates on GlobalWafers, its parent Sino-American Silicon, Sumco, and National Silicon Industry Group, at TWD 620, TWD 255, JPY 1,760, and CNY 3.70 per share, respectively. Because of lower-than-expected utilization, we have cut our 2024 gross margin and EPS forecasts for all these names but leave our afteryears forecasts intact. All wafer names except NSIG are undervalued as we believe the market is still split on the outlook of automotive and industrial semiconductor demand and underestimates the boost on wafer demand from artificial intelligence applications.

We maintain our fair value estimate for National Silicon Industry Group of CNY 3.70 per share after the firm reported disappointing second-quarter results. Our long-term view of the stock being overvalued has not changed as the company plans to spend heavily on expansions to build a self-sufficient wafer supply for Chinese semiconductor manufacturers, regardless of short-term profitability. Taiwan peers GlobalWafers and its parent Sino-American Silicon Products remain our picks in the sector.

We maintain our fair value estimate for no-moat National Silicon Industry Group, or NSIG, at CNY 3.70 per share after the firm reported disappointing first-quarter results. The letdown is a reminder that aggressive capital expenditure is not enough to chip away leaders’ market share in faster-growing high-performance computing and artificial intelligence applications. Taiwan peers GlobalWafers and its parent Sino-American Silicon Products remain our picks in the sector.

We cut our fair value estimate for National Silicon Industry Group to CNY 3.70 per share from CNY 4.10 after trimming our earnings forecasts to account for near-term cyclicality for 2024, updated expansion schedules for 2024-26, and lack of advanced process exposure for the long term. NSIG is significantly overvalued as market expectations are too high with its lack of exposure to faster-growing high-performance computing and artificial intelligence applications, and hefty capital expenditure for at least the next three years. Taiwanese peers GlobalWafers and its parent Sino-American Silicon Products remain our picks in the sector.

National Silicon Industry Group is a Chinese up-and-coming semiconductor silicon wafer producer. Contrary to its larger peers, NSIG is unlikely to build new sites outside of China because of geopolitical risks and the incremental demand coming from Chinese customers. We expect NSIG to triple its 300-millimeter wafer capacity by 2030, compared with end-2023 levels, partly fueled by China’s pursuit of a self-sufficient supply chain.

After National Silicon Industry Group, or NSIG, announced 2023 GAAP and adjusted net profit figures that bear little surprise, we hold our fair value estimate at CNY 4.10 per share pending the company’s release of complete full-year results. We still find NSIG extremely overvalued even after its share price declined over 20% since our initiation, as the market continues to overlook the vast capital spending required for it to reach its aim of 15%-20% of global market share by revenue from its current 4%.