In the semiconductor industry chain, storage chips are one of the most important foundational links. Whether it is smartphones, smart cars, large model servers, or IoT devices, they all rely on the support of storage chips. For a long time, this field has been almost monopolized by overseas manufacturers, with South Korea’s Samsung and SK Hynix, and the United States’ Micron firmly controlling the global market share of NAND and DRAM.
With the rise of the domestic semiconductor industry and the advancement of the self-controllable strategy, the domestic replacement of storage chips is accelerating. Whether it is chip design, wafer manufacturing, equipment materials, packaging testing, or storage modules and main control chips, domestic companies are gradually forming their own breakthroughs. Below, we will analyze a number of representative domestic replacement concept stocks from several key links.
1. Chip Design: The Starting Point of Domestic Replacement
In the entire storage industry chain, design companies are the closest to market applications. They determine the architecture, functionality, and performance of the chips.
GigaDevice is currently one of the most successful storage design companies in China. The company ranks among the top three in the global NOR Flash market share, with automotive-grade products passing AEC-Q100 certification, and it was the first to achieve mass production of 19nm process NOR Flash. More importantly, the company not only provides over 30% of NOR Flash for Huawei in the mobile sector but has also entered the in-vehicle storage segment for new energy vehicle companies such as BYD and NIO. In the future, as self-developed DRAM chips enter the testing phase, GigaDevice is expected to complete its storage product portfolio.
Beijing Junzheng excels in automotive DRAM, currently achieving a global market share of 19%. Its LPDDR4 products have been adapted for Tesla’s FSD and NVIDIA’s Orin platform, indicating that its technical standards fully meet the needs of international top manufacturers. In addition, the company’s self-developed compute-storage integrated chip series X2000 has a computing power of 24TOPS with a power consumption of only 1.2W, and has been integrated into the DeepSeek large model server. This means that Beijing Junzheng is not only a traditional storage manufacturer but also a potential “dark horse” in the AI era.
Unisoc is the only company in China that masters military-grade storage chip technology, holding the top market share in the smart security chip field. The company collaborates with Yangtze Memory Technologies to layout enterprise-level SSDs and promotes the development of 3D NAND Flash, planning to achieve mass production of 128-layer stacked products by 2025. Its advantage lies in the dual attributes of “security + storage,” which combines national strategic value and market space.
Lanqi Technology is a typical “niche leader.” The company focuses on memory interfaces and buffer chips, with a market share exceeding 40% in DDR5 memory buffer chips. Its products have been adapted for high-end GPU clusters such as NVIDIA H100 and AMD MI300X, which means that as AI servers expand, Lanqi Technology can achieve continuous growth.
Dongxin Co., Ltd. follows a diversified route, providing NAND, NOR, and DRAM products widely used in IoT sensors, smart home scenarios, etc. Its automotive-grade NOR Flash has been certified by Tesla and is used in in-vehicle camera storage. In 2024, the company’s automotive electronics business revenue is expected to grow by 75% year-on-year, fully demonstrating its growth potential amid the wave of new energy vehicles.
2. Wafer Manufacturing: Core Links Gradually Breaking Through
The manufacturing of storage chips has long been monopolized by TSMC, Samsung, and others. However, in recent years, domestic foundries have accelerated their catch-up.
SMIC is undoubtedly the leader. The company has achieved mass production at 14nm, with a 90% yield at 7nm, and has undertaken foundry orders from Changxin Storage. Its new factory in Wuxi is planned to be put into production in 2025, which will further enhance its share in the storage foundry segment. For the domestic storage industry, SMIC’s significance lies not only in capacity but also in yield, stability, and cost control capabilities.
Huahong Group mainly focuses on specialty process manufacturing. Although it is not as strong as SMIC in logic chips, it has certain advantages in automotive-grade power devices and some storage chip foundry aspects. Currently, the company’s 12-inch factory is expanding to provide supporting services for the storage chip industry chain.
3. Equipment and Materials: The Most Critical Bottleneck for Domestic Replacement
If storage chips are strategic products, then equipment and materials are the “core weapons.” In the past, Chinese companies relied almost entirely on imports in this area, but in recent years, some companies have gradually made breakthroughs.
NAURA Technology Group is the domestic leader in etching equipment. Its 12-inch high aspect ratio etching machine achieves a precision of 0.02 nanometers and has entered the production line of Yangtze Memory Technologies, with a technical level close to that of international leading manufacturers. As Yangtze Memory Technologies and Changxin Storage expand production, NAURA’s equipment shipment volume is expected to grow rapidly.
Yake Technology is an “invisible champion” in the materials field. The company is the sole supplier of HBM thin film deposition materials, and its products have been certified by Samsung. Its GMC encapsulation material is irreplaceable in HBM packaging. It is worth noting that HBM is one of the most critical storage forms in the AI era, and Yake Technology is at the core of this golden track.
North Huachuang is the absolute leader in domestic semiconductor equipment, with products covering key links such as etching and thin film deposition. Its 5nm etching machine has achieved breakthroughs, becoming the core equipment supplier for Changxin and Changchun’s expansion. Breakthroughs in the equipment segment mean that the domestic storage industry chain is gradually filling in the gaps in “infrastructure.”
4. Packaging and Testing: Domestic Strength Continues to Grow
In the packaging and testing segment of storage chips, domestic manufacturers have already achieved global competitiveness.
Changdian Technology is one of the top three packaging and testing manufacturers globally, having made breakthroughs in HBM3 packaging technology and undertaking 80% of Changxin Storage’s orders. Its automotive-grade production line has a yield rate of 99.95%, indicating that its process level has reached international advanced standards.
Tongfu Microelectronics is the only company in China that has mass-produced FCBGA packaging, capable of supporting 16-layer NAND stacking, and is also the exclusive packaging and testing supplier for AMD AI chips. With its layout in the high-end packaging field, the company has unique advantages in the packaging and testing segment of storage chips.
Hua Tian Technology has recently focused on promoting the mass production of Chiplet technology, becoming a core partner for Huawei HiSilicon storage chips. As the proportion of automotive-grade packaging continues to rise, Hua Tian Technology’s position in the storage packaging and testing segment is further strengthened.
5. Storage Modules and Main Control Chips: Competitive Edge at the Application End
In the storage application segment, modules and main control chips determine the product’s experience and performance.
Bawei Storage is one of the few companies in China with full-chain capabilities in “design + packaging + modules.” Its ePOP packaging technology can integrate NAND and DRAM, and it has become the storage supplier for Meta’s AI glasses. In 2024, Bawei’s overseas revenue ratio is expected to reach 61%, indicating that its products have competitive strength in the international market.
Jiangbolong under the Lexar brand is well-known in the global consumer storage market, with an 18% market share in storage cards and a 15% market share in flash drives. In the enterprise sector, the company’s server PCIe 4.0 SSD has entered the procurement lists of Inspur and New H3C. Its self-developed SLC NAND Flash controller is suitable for industrial-grade scenarios, indicating that its products cover the entire ecosystem from consumer to enterprise.
Shannon Semiconductor established a joint venture with SK Hynix in 2023 to manage the production and sales of enterprise-level SSDs in China. More importantly, the company has developed AI server storage modules based on Hynix’s HBM3 chips, compatible with Sugon and Huawei’s Ascend clusters. Amid the AI computing power wave, Shannon Semiconductor is in a core position.
Leiyun Technology is the second-largest independent supplier of solid-state drive main control chips globally, with its PCIe 4.0 main control chip supporting 8-channel NAND Flash and achieving continuous read and write speeds of 7400MB/s. Its clients include giants like Huawei, Lenovo, and Western Digital, with a continuously expanding market share.
6. Investment Insights
From upstream design to midstream manufacturing, and downstream modules and applications, the domestic storage chip industry chain has basically taken shape. Although there is still a gap with overseas giants in high-end products such as 3D NAND and HBM, domestic companies have already shown strong competitiveness in automotive-grade storage, industrial control, security chips, and the consumer market.
The future investment logic can be grasped from three main lines:
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Technology Breakthrough Type: Such as Lanqi Technology, NAURA Technology, and Yake Technology, which enter high-end tracks with core technologies.
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Ecological Binding Type: Such as GigaDevice, Beijing Junzheng, and Hua Tian Technology, which are bound to leaders like Huawei and BYD.
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Application Growth Type: Such as Bawei Storage, Jiangbolong, and Shannon Semiconductor, which benefit from the growing demand for AI and consumer electronics.
The domestic replacement is a long and challenging path. For investors, focusing on those companies that have both short-term performance support and can establish a foothold in long-term technological evolution is key to capturing the benefits of the storage chip boom.
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