Recently, I noticed a pretty interesting phenomenon: more and more investors are paying attention to IGBT concept stocks, especially as the enthusiasm in the electric vehicle and new energy sectors continues to rise. I just realized that many people might not yet fully understand what IGBT is, so today I want to talk about why it’s worth paying attention to.

First, let’s talk about what IGBT is. Its full name is Insulated Gate Bipolar Transistor, and in Chinese, it’s called 絕緣柵雙極型電晶體. Essentially, it’s a type of power semiconductor. You can think of it as a super-efficient switch that can perform thousands of switching operations per second, which is why it’s called the CPU of power electronic devices. In electric vehicles, the cost of IGBT is second only to the battery, and it has a huge impact on the vehicle’s overall energy efficiency.

From a global industry perspective, the application fields of IGBT are extremely broad. They can be seen in rail transit, electric vehicles, smart grids, renewable energy equipment, aerospace, consumer electronics—almost anywhere energy conversion is involved. Because of these application scenarios, IGBT concept stocks have become a key focus for many investors.

Regarding reasons to invest in IGBT concept stocks, there are mainly a few points. First is the huge market growth potential. According to industry reports, the global IGBT market size grew from $3.2 billion in 2012 to $7.09 billion in 2021, with a compound annual growth rate of 6.6%. More importantly, it’s expected that by around 2027, the market size will further expand to $9.3 billion. The largest demand drivers are electric vehicles and industrial control, accounting for 28% and 37%, respectively.

Second, the high technical barriers mean relatively controllable competition. IGBT belongs to high-end components, and few companies master core technologies, giving related firms higher bargaining power. Currently, the global market is still dominated by giants from Europe, America, Japan, and South Korea. Companies like Infineon, Mitsubishi Electric, ON Semiconductor, Fuji Electric, and ABB hold over 70% of the global market share.

Additionally, government policies support this industry. As the world increasingly emphasizes electric vehicles and green energy, a series of policies have been introduced, creating a favorable environment for the development of IGBT concept stocks. The rapid growth in demand for electric vehicles directly drives the market demand for IGBTs.

On the US stock market, there are many companies related to IGBT. Major chip giants like AMD, Intel, and Broadcom are involved in the IGBT field. For example, AMD’s stock price more than doubled in 2023, rising from around $60 at the start of the year to $140 by year-end; Intel increased from about $30 to $50, nearly a 70% rise; Broadcom went from $600 to over $1,000.

Taiwan’s IGBT concept stocks are also worth paying attention to. Taiwanese power semiconductor manufacturers have actively expanded into the new energy and electric vehicle markets in recent years. Companies like Morimatsu, Qiangmao, and Fuding have made achievements in this field. Morimatsu has been actively deploying automotive power components, with revenue hitting a nearly 11-year high in 2022; Qiangmao mainly produces rectifier diodes and precision electronic materials; Fuding provides advanced electronic integrated solutions.

From a long-term trend perspective, the development of new energy sources like electric vehicles, photovoltaics, and wind power remains upward, and the demand for power components will only increase, not decrease. As the IGBT market size continues to grow, international giants are likely to outsource more advanced technology manufacturing, giving Taiwanese manufacturers greater opportunities to share this vast market.

However, investing in IGBT concept stocks also involves risks. Currently, the most advanced IGBT technologies are still controlled by Europe, America, Japan, and South Korea. If the international supply chain becomes more fragmented or geopolitical tensions escalate, Taiwanese companies may face difficulties in technological breakthroughs or material shortages. Moreover, new semiconductor technologies like silicon carbide (SiC) and gallium nitride (GaN) are gradually maturing, which could alter the competitive landscape of the existing IGBT market. Taiwanese firms need to keep pace accordingly.

As for how to invest, there are quite a few ways. The simplest is directly buying Taiwan-listed IGBT concept stocks, which just requires a Taiwan bank and securities account. You can also trade through CFD contracts, allowing both long and short positions with leverage. For more conservative investors, ETFs that include IGBT concept stocks are an option, such as those tracking Taiwan’s electronics or semiconductor indices.

In summary, the rapid development of the global electric vehicle and new energy sectors in recent years has significantly boosted IGBT demand, making IGBT concept stocks very popular. Although these stocks have experienced some pullbacks recently, the long-term trend of increasing power component demand remains unchanged. Investors might consider taking advantage of the recent adjustments in some IGBT stocks to buy at lower prices.