Core Stocks and Representative Companies in Semiconductor Equipment
As global semiconductor capital expenditure enters a new era of $148 billion, China maintains its position as the largest equipment market with a 34.4% market share. From the mass delivery of 14nm process equipment to the entry of 5nm etching machines into the international supply chain, domestic equipment has shifted from merely “filling gaps” to a critical stage of “performance competition”—by the first half of 2025, the domestic equipment substitution rate has risen to 35%, with significant breakthroughs in core areas such as etching and thin film deposition. As the “mother machine” of chip manufacturing, the localization of semiconductor equipment directly relates to the security of the industrial chain, and a number of leading A-share companies are rewriting the global competitive landscape through technological breakthroughs. The following will analyze the core players in the equipment field and the operational logic of the entire industrial chain.
Core Stocks and Representative Companies in Semiconductor Equipment
1. Etching Equipment: International Breakthroughs in High-End Market
- Zhongwei Company (688012): The absolute leader in domestic etching equipment, with 5nm etching machines already entering TSMC’s advanced process production lines, covering over 95% of etching application scenarios. In the first half of 2025, revenue reached 4.961 billion yuan, a year-on-year increase of 43.88%, with etching equipment accounting for over 75% of revenue, and LPCVD equipment sales surging by 608.19% year-on-year. Its MOCVD equipment has a global market share of over 60%, with clients including international giants like Samsung and TSMC, and its subsidiary is expanding into the new field of electron beam inspection equipment.
- North Huachuang (002371): A “jack of all trades” in equipment, covering the entire chain of etching, deposition, and cleaning. In the first half of 2025, it secured a 12 billion yuan order from SMIC, accounting for 40% of its 2024 revenue. The 14nm equipment has been validated and is in mass production, with 28nm PVD equipment being supplied in bulk, and high-end equipment revenue accounting for 35%, with orders from top clients exceeding 60%, while also expanding into overseas markets in Southeast Asia and the Middle East.
2. Thin Film Deposition Equipment: Significant Acceleration of Domestic Substitution
- Tuojing Technology (688072): A leader in domestic thin film deposition equipment, with PECVD equipment already integrated into the supply chain of SMIC and Yangtze Memory Technologies, achieving over 20% market share in the 28nm logic chip sector. The 14nm ALD equipment launched in 2025 has passed validation, breaking the monopoly of Applied Materials in advanced processes, with revenue growth of 58% year-on-year in the first half of the year.
- Huahai Qingke (688120): A domestic leader in CMP equipment, with 12-inch CMP equipment achieving large-scale application at Yangtze Memory Technologies and Changxin Memory Technologies, with market share expected to rise to 30% in 2024, and technical parameters approaching those of similar products from Applied Materials, aiding in the domestic substitution of memory chips.
3. Other Key Segmented Fields
- Jingce Electronics (300567): A leader in inspection equipment, with wafer inspection systems covering SMIC’s 14nm production line, and over 1.5 billion yuan in new semiconductor inspection orders expected in 2025, forming a “front-end + back-end” collaborative layout with Zhongke Feime.
- Xinyi Chang (688383): A core enterprise in packaging equipment, with die bonding machines holding over 60% market share in the LED packaging sector, and recently entering the advanced packaging field for semiconductors, with Chiplet packaging equipment receiving bulk orders from Changdian Technology.
- Xinyuan Micro (688037): A representative of wet processing equipment, with cleaning equipment already entering the production lines of SMIC and Huahong Semiconductor, and the 300mm single-wafer cleaning machine launched in 2025 breaking the monopoly of Shengmei Shanghai, with revenue growth of 42% in the first half of the year.
Semiconductor Equipment Industry Chain
- Upstream: Key Breakthroughs in Core Components
Covering precision machinery, electronic components, and special materials, these are the core support for equipment performance. In the past, high-end vacuum pumps and precision sensors were heavily reliant on imports, but now the localization rate of key components such as “plasma hearts” has risen to 60%. Representative companies include: Hanzhong Precision Machinery (the largest market share in vacuum pumps in China), Wanye Enterprises (core components for ion implanters), and Quartz Co., Ltd. (with over 20% global share in semiconductor-grade quartz materials). However, high-end bearings and grating scales required for 7nm equipment still rely on imports, and supply chain security remains a challenge.
- Midstream: Main Force of Domestic Equipment Localization
These are the manufacturers of equipment in various segmented fields, which are the core link of the industrial chain. In addition to the aforementioned companies, there are also: Zhangjiang Hi-Tech in the photolithography equipment field (holding shares in Shanghai Micro Electronics), Weidao Nano in the thin film equipment field, and Changchuan Technology in the inspection equipment field. The industry shows a “head concentration” characteristic, with leaders like North Huachuang and Zhongwei Company seizing over 60% of the domestic equipment market share due to technological barriers, with R&D investment generally exceeding 15%.
- Downstream: Sustained Strong Demand from Manufacturing
Mainly for wafer foundries, memory chip manufacturers, and packaging and testing companies, directly driving equipment procurement. SMIC is expected to have capital expenditure exceeding $30 billion in 2025 for expanding production of 14nm and below processes, leading to a surge in demand for etching and deposition equipment; Yangtze Memory Technologies is expanding its 128-layer 3D NAND production line, resulting in a year-on-year increase of 45% in CMP and cleaning equipment procurement. On the packaging and testing side, Changdian Technology and Tongfu Microelectronics are expanding their advanced packaging production lines, driving sales growth of die bonding machines and wire bonders.
Investment Opportunities and Risk Warnings under Domestic Substitution
The global semiconductor equipment market is showing a pattern of “East Rising, West Declining”, with China’s market share expected to further increase to 38% by 2025. Institutions predict that the net profit growth rate of domestic equipment companies will exceed 40%. Investment can focus on three main lines:
1. The etching and thin film deposition fields with clear technological breakthroughs, with Zhongwei Company and Tuojing Technology continuously enhancing their competitiveness in advanced processes;
2. Platform-type leader North Huachuang, benefiting from the growth of all-category orders brought by wafer factory expansions;
3. Back-end equipment companies such as Jingce Electronics and Xinyi Chang, which have performance elasticity.
However, two major risks need to be heeded:
1. The risk of reliance on core components, as companies like North Huachuang still need to import components like vacuum pumps for high-end equipment, and geopolitical factors may affect supply chain stability;
2. The risk of technological iteration, as there is still a gap between 7nm and below advanced process equipment and international giants like Applied Materials and Tokyo Electron. It is recommended to prioritize companies with high R&D investment (e.g., Zhongwei Company with over 30% R&D ratio) and deep binding with top clients.
With the third phase of the big fund ramping up and the resonance of wafer factory expansions, the domestic substitution of semiconductor equipment has entered the “deep water zone”. Those who can break through the bottlenecks of components and achieve mass production of advanced process equipment will ultimately occupy a core position in the global industrial landscape.
Special Statement:This account’s related content is sourced from publicly available historical data on the internet. If there are any errors, please refer to the latest information. This is for research and discussion purposes only and does not constitute any investment advice. Please do not use this as a basis for investment reference. If there are any inaccuracies, please feel free to supplement and correct. Investment carries risks, and caution is advised.
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