【Industry Spotlight Report】New Round of Supply Chain Price Increases May Be Coming; High Sentiment in Semiconductor Industry Expected to Persist

The three major Chinese A-share indices showed mixed performance today. By the close, the Shanghai Composite fell 0.26%, the Shenzhen Component rose 0.19%, and the ChiNext Index increased 1.41%. The combined trading volume of the Shanghai, Shenzhen, and Beijing markets exceeded 2.3 trillion yuan, slightly down from the previous trading day. Industry sectors showed mixed gains and losses, with semiconductors, components, shipping ports, advertising and marketing, and white liquor leading the gains. Gold, steel, coal, rare earths, and agrochemical sectors declined the most.

In individual stocks, over 2,800 stocks rose, with 60 hitting the daily limit.

According to media reports, after storage chips and packaging, the semiconductor supply chain may see a new wave of price increases. Mature process wafer foundries such as UMC, World Advanced, and Powerchip are expected to raise prices starting as early as April, with increases of up to 10% or more. UMC has not responded to market rumors of price hikes but previously mentioned that current pricing conditions are “more favorable than before.” World Advanced’s price increase notice indicates a planned adjustment starting April 2026, but no specific increase was disclosed, and the company has not responded to the price hike. Powerchip confirmed that it has been gradually raising prices this quarter, mainly for product lines with lower gross margins. Additionally, major customers in mature processes, especially IC design companies driven by ICs, are planning to raise prices due to rising costs.

Furthermore, NVIDIA’s annual developer conference (GTC 2026), known as the “AI Spring Festival,” will kick off in San Jose, California, on Monday. CEO Jensen Huang will deliver a keynote speech and unveil the new generation of chip architecture and inference chips. The conference runs from March 16 to 19 and is expected to reinforce market confidence in the sustained growth of the AI industry.

Aijian Securities pointed out that rising prices of key materials combined with supply chain security demands may accelerate the localization of semiconductor equipment components. Shenwan Hongyuan Securities believes that the global semiconductor industry is experiencing a systematic price increase across all segments, from upstream wafer manufacturing and packaging/testing capacity quotes to midstream storage chips, MCUs, analog chips, power semiconductors, and supporting passive components like resistors, inductors, and connectors. The entire industry chain is simultaneously undergoing price restructuring.

Aijian Securities: Localization of Semiconductor Equipment Components May Accelerate

Rising prices of key materials such as high-purity silicon carbide, ceramic substrates, and special metals are increasing manufacturing costs for equipment components. Under the ongoing efforts of equipment manufacturers to reduce costs and enhance supply chain security, domestic companies are strengthening their local supply chains. Domestic component suppliers with deep customer certifications and advanced materials and process capabilities are expected to accelerate market entry and continue gaining market share.

Shenwan Hongyuan: Full Industry Chain Price Restructuring Begins Simultaneously

This round of price increases features full-chain transmission and global resonance. Driven by accelerated AI capital expenditure and rising prices of metals like gold, silver, and copper, a comprehensive inflation pattern has formed in the first quarter of 2026. The global semiconductor industry is experiencing a systematic price increase across all segments, from upstream wafer manufacturing and packaging/testing capacity quotes to midstream storage chips, MCUs, analog chips, power semiconductors, and supporting passive components and connectors. The entire industry chain is undergoing price restructuring.

Galaxy Securities: Visibility and Delivery Certainty in Equipment Orders Continue to Improve

SMIC has clarified that its 2026 end-of-year monthly capacity increase is expected to reach the equivalent of 40,000 12-inch wafers, providing stable growth opportunities for domestic semiconductor equipment companies. Coupled with the emphasis on “accelerating the development of key equipment, materials, and components” in the 14th Five-Year Plan, the strategic importance of equipment localization is further reinforced. Driven by accelerated AI infrastructure development and capacity expansion in mature processes, order visibility and delivery certainty in the equipment segment continue to improve.

Southwest Securities: Design and Manufacturing Indices May Return to Favorable Stocks

In ETF investment, semiconductor investments mainly focus on six industries related to upstream supply and midstream manufacturing in the integrated circuit industry chain. These include EDA tools, semiconductor materials, and equipment for upstream; and IC design, manufacturing, and packaging/testing for midstream. Design and manufacturing indices are most sensitive to end-market demand expansion and tend to show higher resilience during industry upswings. Material and equipment indices perform better during phases of “independent controllability” reinforcement. The full industry chain layout is relatively balanced, with returns and risks typically between the other two. Currently, the semiconductor sector’s driving factors are shifting from independent controllability to AI demand and performance validation, suggesting that design and manufacturing indices may regain favor.

Guotai Haitong: Accelerating Domestic Substitution

Compared to logic chips, the gap between domestic and foreign storage chips across generations is smaller. The development of AI has triggered a “big inflation” in global storage markets. For domestically developing storage companies still in the growth phase, this improves cash flow, shortens depreciation recovery cycles, and enhances profitability and stock prices, facilitating capacity expansion through capital markets. This benefits domestic packaging/testing and equipment industries and accelerates the domestic substitution process.

Donghai Securities: Strong AI Demand Drives Semiconductor Segments

Robust AI demand is driving growth in specific semiconductor segments. Broadcom’s first fiscal quarter AI revenue surged 106% year-over-year, and it expects a 47% YoY revenue increase in the second quarter, mainly benefiting from strong demand for custom AI accelerators and AI networks. Storage structural shortages caused by AI infrastructure and consumer electronics competition are expected to persist through 2026. Despite significant corrections in overseas electronic semiconductor companies, China’s semiconductor industry remains optimistic, with substantial long-term potential for localization.

(This article does not constitute any investment advice. Investors operate at their own risk. The market involves risks; please invest cautiously.)

(Source: Eastmoney Research Center)