Semiconductor Manufacturing International Corporation (0981.HK)

China’s biggest chip maker, SMIC, to withdraw from New York Stock Exchange as trade spat with US spills over to tech sector
* The sudden move comes as Washington steps up efforts to cut off its technology from China

Zhang Shidong  
Published: 8:43pm, 24 May, 2019

China’s biggest maker of semiconductors is to withdraw from the New York Stock Exchange as the increasingly ferocious trade war with the US spills over into the technology sector.

Semiconductor Manufacturing International Corp (SMIC) said on Friday evening it has notified NYSE of its intention to apply on June 3 to delist its so-called American depositary receipts from the bourse. In a filing to the Hong Kong stock exchange, where its shares are listed, SMIC cited low trading volumes of its ADRs and the costs of maintaining the listing and complying with reporting requirements and related laws.

The delisting is expected to happen after June 13, and trading of the chip maker’s US securities will shift to the over-the-counter market, the statement said.

More details in https://www.scmp.com/business/article/30...trade-spat

SMIC IPO will be listed on the Technology Star Board in Shanghai on Thursday July 16, 2020.

As one of China's most dominant businesses and firmly entrenched in the Chinese society, Alibaba has attracted a lot of attention in the retail investors space, and there's no shortage of financial influencers talking about it.

If one considers the likes of Tencent/Alibaba as "indispensable" in China, I think major players in China's semiconductor space could be worth a look especially when China is seeking self-sufficiency in semiconductor manufacturing.

Furthermore, unlike the popular Chinese tech companies, SMIC is partially state-owned and thus, likely more in line with the government's ideals, which enables it to enjoy continued growth with a long runway(self sufficiency ambitions) with much lesser regulatory uncertainty.

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How Realistic Are China’s Semiconductor Ambitions?
https://www.project-syndicate.org/commen...ee-2022-06

Semiconductor Self-Sufficiency: MIIT’s Ambitions for 2021 and Beyond
https://chinabusinessreview.com/semicond...0objective.

http://www.aastocks.com/en/stocks/quote/...mbol=00981

SMIC does not have the technology to produce the advanced chips. China is already giving a large part of its business to SMIC, however for equipment that require 5nm chips, China has to reluctantly turn to other countries.

If SMIC could do it, it would have been the sole supplier for China Tech products.

https://min.news/en/tech/dc667e6452a27d1...9b95a.html

With regards to whether China can catch up the the world in terms of semiconductor mfg, there is some good summary made on lilian@substack some time back and I will post them below.

https://lillianli.substack.com/p/china-s...d-the-push
https://lillianli.substack.com/p/china-s...e-push-de2

One of the nuances for semiconductors is that profitability doesn't necessarily need to come from technology leadership. You could be producing leading edge chips which your competitors are also producing (with help from the same equipment suppliers like ASML/AMAT) and in a race to the bottom when supply overstrip demand. On the other hand, you could be using reliable cheap legacy technology/tools (or what they call "lagging edge") and still make big money since no1 else is competing with you.

Yes profitability and tech leadership is different. Depends what China is looking for and it's not just manufacturing

Case in point: Hynix when it was on the verge of collapsing could continue to milk it's legacy nodes when the window was there and it was arguably saved by Apple's $1b pre-order which they promptly had to improve their process else the cost curve will eventually catch up

A case in point of cost curve catching up is UMC which used to be one of the leader. They are still profitable and respectable ROIC but their normalised profit will trend down over the years as they milk it. But I'm being simplistic here cause memory and logic manufacturing is not exactly comparable.

This will be quite major impediment if rolled out and will affect even the chinese chip manufacturing cause the after sale service and calibration / technical support is just as important as the machines

(Bloomberg) -- China accused the US of “technological terrorism” in pushingto stop ASML Holding NV and Nikon Corp. from selling key chipmaking technology to the country, in some of its strongest criticism yet of Washington’s efforts.
Chinese Foreign Ministry spokesman Zhao Lijian lashed out at Washington after Bloomberg News reported the US is lobbying allies to stop the sale of mainstream technology essential for making a large chunk of the world’s chips, expanding a years-long campaign to curb the country’s rise. He didn’t say whether China planned any retaliatory measures in response to the move. 
“This is yet another example of the US practice of coercive diplomacy by abusing state power and wielding technological hegemony. It is classic technological terrorism,” Zhao told a regular news briefing Wednesday in Beijing. “This will only remind all countries of the risks of technology dependence on the US and prompt them to become independent and self-reliant at a faster pace.”
The proposed restriction would expand an existing moratorium on the sale of the most advanced systems to China, in an attempt to thwart the country’s plans to become a world leader in chip production. If the Netherlands agrees, it would broaden significantly the range and class of chipmaking gear now forbidden from heading to China, potentially dealing a serious blow to Chinese chipmakers from Semiconductor Manufacturing International Corp. to Hua Hong Semiconductor Ltd.
US Pushes for ASML to Stop Selling Chipmaking Gear to China
American officials are lobbying their Dutch counterparts to bar ASML from selling some of its older deep ultraviolet lithography, or DUV, systems, people familiar with the matter said. These machines are a generation behind cutting-edge but still the most common method used for making certain less-advanced chips required by cars, phones, computers and even robots. 
Washington is also trying to exert pressure on Japan to stop shipping the same technology to Chinese chipmakers, one of the people said. Japan’s Nikon competes with ASML in the area.
“Chinese chipmakers have been hoarding second-hand equipment since the Trump era,” said Amir Anvarzadeh of Asymmetric Advisors. Banning the most advanced tools was “clearly not enough to halt China’s advancement in semiconductors, especially since much of the chips used for defense purposes are using geometries that were far less advanced.”

(30-06-2022, 10:19 AM)weijian Wrote: With regards to whether China can catch up the the world in terms of semiconductor mfg, there is some good summary made on lilian@substack some time back and I will post them below.

https://lillianli.substack.com/p/china-s...d-the-push
https://lillianli.substack.com/p/china-s...e-push-de2

One of the nuances for semiconductors is that profitability doesn't necessarily need to come from technology leadership. You could be producing leading edge chips which your competitors are also producing (with help from the same equipment suppliers like ASML/AMAT) and in a race to the bottom when supply overstrip demand. On the other hand, you could be using reliable cheap legacy technology/tools (or what they call "lagging edge") and still make big money since no1 else is competing with you.

China will catchup once it brings Taiwan back into its fold now that Hongkong is a done deal, Hello TSMC! #All your base are belong to us... well except maybe TSMC's overseas facilities like WaferTech in USA and SSMC in Sg.