In 2021, China's chip design sales in Shanghai ranks first, and Shenzhen drops by 46.4%
Chinese mainland chips, Shenzhen down 46.4%
At the moment when there is a shortage of cores and price increases, integrated circuits have become the focus of attention from all walks of life.
On December 22, at the "2021 China Integrated Circuit Design Industry Conference and Wuxi Integrated Circuit Industry Innovation Development Summit Forum (ICCAD 2021)", Professor Wei Shaojun, Chairman of the Integrated Circuit Design Branch of China Semiconductor Industry Association, gave a speech on my country’s IC design industry.了Analysis.
Data show that as of December 1, 2021, chip design companies in mainland China have increased from 2,218 last year to 2,810, a year-on-year increase of 26.7%. Among them, in addition to traditional design companies such as Beijing, Shanghai and Shenzhen, there are more than 100 design companies in cities such as Wuxi, Hangzhou, Xi'an, Chengdu, Nanjing, Wuhan, Suzhou, Hefei, and Xiamen.
But Wei Shaojun said that the continuous large increase in the number of design companies is not necessarily a good phenomenon, because it will disperse talents and resources to a certain extent.
From the perspective of chip design industry sales, the industry-wide sales in 2021 are expected to be 458.69 billion yuan, an increase of 20.1% from 381.94 billion yuan in 2020, and the growth rate is 3.7% lower than the 23.8% of the previous year. According to an average exchange rate of 1:6.5 between USD and RMB, annual sales are approximately USD 70.57 billion, which is expected to account for an increase in the proportion of global integrated circuit product sales revenue.
From the perspective of major regional developments, due to the global core shortage and price increase in 2021, the Yangtze River Delta region’s sales in 2021 reached 238.33 billion yuan, an increase of 49% year-on-year; the Beijing-Tianjin Bohai Sea region’s sales in 2021 were 984.3 Billion yuan, a year-on-year increase of 76.7%; sales in the central and western regions in 2021 will be 57.37 billion yuan, a year-on-year increase of 40.3%. In the Pearl River Delta region, sales in 2021 were 93.62 billion yuan, a year-on-year decline of 36.9%.
The decline in sales in the Pearl River Delta region was mainly due to the US sanctions imposed by Shenzhen Huawei HiSilicon. Shenzhen’s integrated circuit design industry is highly concentrated. According to data in 2019, the top ten companies’ sales totaled 106.57 billion yuan, accounting for 97% of the city’s design industry sales. Among them, Huawei HiSilicon alone accounted for 83.4 billion. Yuan, accounting for nearly 80%. In the latest 2021 world semiconductor manufacturer TOP25 announced by Insights, HiSilicon has fallen out of the top 25.
Shenzhen is a major chip design town in the Pearl River Delta. In 2020, its design industry sales reached 130 billion yuan, ranking first in the country. However, in 2021, its sales dropped by about 46.4% to 69.71 billion yuan. Slumped to the third place in the country.
In 2021, with the exception of Shenzhen and Hong Kong, the design industries of other major cities have recorded positive growth. Due to the decline in Shenzhen, Shanghai will become the largest city in the chip design industry with sales of 120 billion yuan in 2021, followed by Beijing, Shenzhen, Hangzhou, Wuxi, Nanjing, Xi'an, Chengdu, Wuhan, and Zhuhai.
The total industrial scale of the 10 cities reached 432.69 billion yuan, accounting for 94.3% of the entire industry, which was 2.5 percentage points lower than the 96.8% in 2020. The threshold for entering the top 10 cities has been raised to 11 billion yuan, an increase of 2.74 billion yuan from 2020.
From the urban distribution of chip design companies with sales of more than 100 million yuan, in 2020, only 11 companies with sales of more than 100 million yuan will be in Nanjing. In 2021, they will rank first in the country, with 52 companies with sales of more than 100 million yuan; Shenzhen will start from last year. The number of companies increased from 29 to 50 this year and ranked second; Wuxi increased from 10 to 42 and ranked third; Beijing increased from 33 to 39; Hangzhou increased from 15 to 36; Guangzhou had 14 sales Companies with more than 100 million yuan are included in the statistics for the first time.
According to statistics over the past years, about 40% of chip design companies are profitable, while 60% of companies are unprofitable. According to this year’s situation, due to tight production capacity and price increases, which have brought great growth to the industry, the benefits of chip design companies are improving this year. The number of profitable companies should exceed 50% of the total, and may reach 60%. .
From the perspective of gross profit margin, the average gross profit margin of the top 100 chip design companies in mainland China in 2021 is expected to be 34.64%, which is less than a percentage point higher than the 33.7% of the previous year, but it is still relatively low compared with overseas companies.
Due to the US's suppression and sanctions on Chinese related companies, the sales of communications, smart cards and computers (including artificial intelligence) three types of chips have experienced a significant decline, falling by 37.5%, 47.7%, and 35.5%, respectively. However, sales in the multimedia, navigation, analog, power, and consumer sectors are improving.
Among them, the sales of analog circuits increased the most, reaching 230.5% to 54.14 billion yuan; power circuits increased by 152.8% to 29.15 billion yuan, and consumer chips increased by 94.2% to 206.58 billion yuan.
Judging from the IPO situation of companies in the chip design field, as of December 22, a total of 7 chip design companies have been listed on the Science and Technology Innovation Board this year, and the amount of funds raised reached 12.09 billion yuan. A total of 42 design companies listed on the Main Board, SME Board, ChiNext Board and Science and Technology Innovation Board have raised funds of 44.66 billion yuan, and the total market value on December 1, 2021 reached 1831.76 billion yuan.
Wei Shaojun said that after more than 20 years of hard work, China's integrated circuit design industry has begun to take shape and has become an important force in the global integrated circuit industry. The development of China's integrated circuit products has passed the stage of "from nothing to something", and is moving on the road of "from good to good" and "from good to excellent".
my country's integrated circuit product system is one of the most complete chip product systems in the world. It not only has strong competitiveness in the field of low-end chips, but also got rid of the passive situation of relying entirely on foreign products in the field of high-end chips. Domestic integrated circuit chips cover almost all fields such as digital, analog, digital-analog hybrid, radio frequency, power, computing, storage, and interface. Even in electronic design automation tools (EDA), intellectual property core (IP core) and other fields, there are relatively good accumulations, which can provide necessary support for the development of design enterprises.
In addition, my country's IC design level and innovation capabilities are constantly improving; at the same time, it also has strong application development capabilities; and continuously improving industrial ecology.
However, Wei Shaojun also pointed out that if China's integrated circuit design industry is to be internationally competitive, we must also face some deep-seated problems and resolve some deep-seated contradictions:
First, the overall scale of the design industry is less than 100 billion U.S. dollars, and there is still a big gap compared with the annual consumption of more than 150 billion U.S. dollars in the Chinese market;
Second, the performance growth of the design industry in 2021 is due to a certain extent due to the tight global production capacity and the price increase of integrated circuits caused by the disruption of the supply and demand balance. Once the tight production capacity is relieved, the performance of the company may fall;
Third, the shortage of talents in the past two years has led to a substantial increase in corporate human costs, which has put more pressure on the company's already low gross profit space;
Fourth, insufficient R&D investment has begun to seriously affect the improvement of enterprises' innovation capabilities.
Capital is like a running wild horse, pulling the valuation of chip companies soaring, and will continue to inflate the bubble. Facing the phenomenon of being "encumbered" by capital, Wei Shaojun emphasized that we must return to the origin of the industry. "Integrated circuits cannot become a pig in the air, and we must prevent others from turning you into a pig in the air."