The Zhitong Finance App learned that Ping An Securities released a research report saying that in the context of the continuous expansion of SiC production, the supply capacity of SiC substrates and devices continues to increase, and the scale effect drives prices to continue to drop, and the SiC penetration rate continues to rise. It is expected that in 2024, the SiC market will launch more models equipped with SiC devices, which will further drive the growth of SiC demand, and the country's emphasis on key materials in key areas continues to increase, and domestic manufacturers are expected to welcome A good opportunity for development.

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Ping An Securities's views are as follows:

The material properties are outstanding, and the advantages of the device are obvious.

Currently, Si semiconductors are approaching the physical limit. Third-generation semiconductors, represented by SiC, have become one of the key directions in the development of the semiconductor industry in the post-Moorish era. SiC materials have characteristics such as high breakdown electric field, high thermal conductivity, and high saturated electron drift speed. Compared with Si products, the prepared devices can reduce the device size by 90%, and have broad replacement space in the fields of new energy vehicles, photovoltaics, and rail transit.

SiC is an important new material for semiconductors, and there is a strong demand for autonomous and controllable industrial chains.

Currently, overseas technological restrictions on China continue to increase, and the industrial chain is autonomous and controllable. As an important new material in the semiconductor field, SiC technology gap at home and abroad is about 5-8 years. Compared with silicon-based semiconductors, the country's attention will continue to rise. It is expected that favorable policies will continue to be introduced to help the development of the domestic SiC industry, and the domestic SiC industry chain is expected to usher in a good opportunity for rapid development.

SiC crystals grow slowly and are difficult to process. Improving yield and production capacity is the key to controlling costs.

The cost of SiC devices is about 3 times that of Si devices, which is one of the core factors limiting the rapid development of the SiC industry. The main reason for this problem is that SiC long crystals are slow and difficult to process, and the conversion rate from raw materials to wafers is only 50%. In the future, under the combined effects of technological progress and economies of scale, production lines will shift to 8 inches, and the expansion of substrate size will help the industrial chain reduce costs. It is expected that substrate prices will drop at a rate of 8% per year, which is expected to further accelerate the development and penetration of SiC.

Cost reduction and efficiency gains are obvious, and the continued downstream boom has led to an increase in demand.

SiC devices can bring significant efficiency improvements and comprehensive cost optimization to key downstream sectors such as new energy vehicles and photovoltaics. As SiC penetration accelerates, Yole expects the global SiC device market to reach 7.1 billion US dollars in 2026. Among them, new energy vehicles are the main driving force for SiC device growth, and overall sales have shown a rapid growth trend in recent years, which will continue to drive demand for SiC devices. The global automotive SiC power device market is expected to reach 5 billion US dollars in 2027.

Risk warning: 1) the progress of silicon carbide delivery falls short of the expected risk; 2) the domestic substitution process in all parts of the industrial chain falls short of the expected risk; 3) the decline in substrate prices falls short of the expected risk; 4) the macroeconomic downturn.