Advanced HDI PCB market analysis report
HDI(High-density Interconnect) is a circuit with a relatively concentrated pattern in the PCB field. The market share of leading enterprises can exceed 10%. Heavy investment in production lines, relatively High technical requirements, and environmental approval threshold for electroplating production lines are the core barriers to form this pattern. In addition, long-term stable technical support of major customers is crucial for industrial chain companies to maintain leadership.
High density interconnect printed circuit board related concepts
High Density Interconnect printed circuit board (HDI PCB), which is a kind of printed board with High Density design in pursuit of light, thin, short and small electronic products (or components) since the 1980s. Compared with conventional printed boards, it has a high wiring density per unit area, which is mainly characterized by thin lines, microblind holes and thin dielectric layers.
High-density printed boards have various titles in the development process, such as micro-via multi-layer PCB (micro-blind hole multilayer board), Build-up multilayer PCB (BUM, laminated multilayer board or augmented multilayer board) and so on, which are collectively referred to as HDI PCB in the industry now.
Currently, the industry limits for HDI PCB is as follows: minimum line width/spacing of 75 µm/75 µm and below; The minimum through-hole aperture is 150 µm and below; With blind hole or blind buried hole, the minimum pad is 400 µm and below; The density of pad is greater than 20cm2.
At present, multilayer FPC PCB, high multilayer board, rigid flexible binding board, etc. are also manufactured by HDI process in some or all areas, but the industry is still used to put them in the original category.
HDI generally includes first-layer, second-layer, multi-layer (third-layer and above, the current applications are mostly third-layer and fourth-layer, but the fourth-layer and above are basically converted into Any layer), Any layer ( Any layer, also called ELIC (Every layer Interconnect, Laser drilling is used to realize the interconnection between all layers) and SLP (Substrate Like PCB).
Judging from the capital expenditure of the global mainstream HDI companies in recent years, there is no large-scale expansion of high-grade capacity in the early stage, and the tight supply and demand of the industry is expected to bring the opportunity of volume and price rise around 2020.
Although China’s local HDI started late, under the trend of rapid growth of demand for 5G mobile phone motherboard upgrade, Goworld, DSBJ, Founder and other companies are expected to set foot in the high-end market in the short term, and A-share Avary Holding has already completed the top card.
In the medium and long term, the Chinese enterprises with fine management ability and production expansion and iteration strength are expected to gradually enter the high-end track under the advantages of customer support and stronger investment ability, such as Huawei.
HDI industry technology and investment barriers deep high-end capacity is difficult to short-term expansion
In terms of market competition pattern, there are many giants in the global HDI market, which are basically occupied by companies from Taiwan China, Japan, South Korea and the United States. These enterprises maintain a relatively large leading edge in technology and scale by relying on the long-term driving effect of big customers such as Apple.
The market share of the company is 18% from Taiwan China, 4% from Japan, 8% from the United States, 8% from Austria and 3% from South Korea. The top 10 companies accounted for 56% of the total.
From the perspective of pattern, HDI is the circuit with relatively concentrated pattern in PCB field. The market share of leading enterprises can exceed 10%, and the technology and scale advantages of industry giants form higher barriers.
In terms of manufacturing region, the global HDI is mainly manufactured in China (about 59%), Taiwan China (about 18%), South Korea (about 11%), and Japan (about 5%) (Vietnam and other countries also have a small amount of manufacturing, about 7%).
At present, Hong Kong HDI manufacturers are Kingboard, Eton, Red board, etc. HDI manufacturers in Hong Kong are relatively small in scale and mainly focus on the production of low-end HDI (Kingboard has a large scale of HDI manufacturing and also has AnyLayer manufacturing capability).
HDI of China starts relatively late, implement production HDI before 2000 are foreign companies, such as the time of the Compeq(Taiwan-funded), SME(Hong Kong-owned enterprises, after the acquisition of TTM American-owned), guangzhou Elec&Eltek (Hong Kong, after the acquisition of Hong Kong capital Kingboard), etc.
At present, a small number of semiconductor packaging plate and some HDI manufacturers are manufacturing SLPS. From the perspective of HDI process, SLP can be considered as an Any Layer technology (minimum linewidth spacing of 30/ µm30 µm) using mSAP (improved half-addition process).
SLP technology is a perfect reference to the mSAP process commonly used on the carrier board, and makes maximum use of the existing equipment and technology of HDI (which requires a certain amount of investment or upgrade of equipment).
It surpasses the existing Any Layer technology, but it has low production cost and high efficiency compared with the manufacturing of carrier plate (but there is the problem of high defect rate in the initial stage).
According to the classification of the above, the world’s major HDI manufacturers product layout of balanced, full coverage, no obvious echelon between enterprise technical differences, only SLP technical penetration at 60%, the enterprise basic such as apple, samsung, huawei and millet support supplier, other category of technology penetration were more than 80%.
The capital expenditure of these major global HDI suppliers in recent years can be seen:
(1)In recent three years, most of the enterprises with large capital investment and annual investment of more than 1.5 billion yuan are companies that give consideration to other heavy asset business (such as package substrate, panel, etc.), and these large capital expenditures are basically invested in their main industries, such as LGINNOTEK on panel, Kyocage on magnetic materials and components, Unimicron on package substrate, etc.
HDI PCB is only its auxiliary business, not a large-scale expansion of production;
(2)Due to the overall weak demand for smartphones, three industry giants have exited the high-end HDI PCB market since 2020. For example, LG Innotek announced that it has decided to terminate the printed circuit board (PCB) business, which is part of the HDI business and accounts for 3.1% of the company’s total sales.
LG Innotek is expected to end PCB production within this year and stop selling PCBS in June next year. In 2019, Samsung Electric (Semco), the electronic component manufacturing company of Samsung Electronics, announced that it would shut down its Kunshan Samsung Electric in Jiangsu province and formally exit the HDI PCB business of smartphones.
Daeduck Electronics, a South Korean PCB maker, will stop production of high density interconnect (HDI) boards for mobile phones in 2020.
(3)Compeq, TTM, Otes, etc., have an annual capital input of 5 to 1 billion yuan in the past three years. Considering that these enterprises are Apple suppliers, their SLP production lines need large-scale maintenance and production expansion, and are not completely compatible with high-order HDI production lines. Other Apple businesses also need capital input to maintain competitiveness.
Even if HDI has been expanded, the peak season is not a lot of spare capacity can be used to large-scale undertake Android motherboard upgrade needs.
(4)Although Chinese enterprises have continued to invest in recent years, the short-term technological threshold is difficult to overcome.
The supporting effect of big customers also strengthens the industrial base
The core barrier is technology and investment threshold.
The reasons for the current situation of HDI market competition are heavy investment in HDI production lines, relatively high technical barriers, and environmental approval thresholds for electroplating production lines.
In terms of investment, the investment/income ratio of ordinary multilayer board can reach about 1:2, while the investment/income ratio of high-end HDI and SLP production line is only 1:1 or lower. Many foreign manufacturers (high-end HDI PCB manufacturers) lack investment willingness and ability, and the internal decision-making mechanism is too long.
Technically, high-end HDI is a field with relatively high technical barriers in PCB. Laser drilling + electroplating hole filling process requires long-term accumulation of good efficiency production experience.
Long-term stable technical support from key customers is crucial for industrial chain companies to maintain leadership, and to a certain extent, it strengthens the industrial foundation. From the perspective of the customization attributes of the circuit board industry, PCB process upgrading depends on the product design of customers.
PCB enterprises are more likely to implement solutions, and Apple and other customers are often the promoters of solution innovation. The driving effect of customers’ technical capabilities on suppliers is the core driving force for PCB enterprises to maintain technological leadership.
Enterprises usually finish their own technology iteration and update by tracking customers’ technical requirements in the early process of proofing and sending samples.
Many HDI PCB enterprises mostly card Apple, Samsung and other customers, can maintain long-term technological leadership, forming a high barrier.
In addition, many companies are also suppliers of non-motherboard lines such as Apple device external interface PCB, audio module PCB, charging equipment PCB, headphone PCB, etc. These products also need to use multi-stage or arbitrary layer HDI PCB, the technical requirements exceed the industry average, and have a high gross margin.
The follow-up is expected to benefit from the multi-dimensional economic trend of Apple’s industrial chain next year, as well as the industry-oriented 5G mobile phone motherboard upgrade opportunity.