What is IGBT?

As a "newcomer" in the field of new energy, IGBT is the core device for energy transformation and transmission, which can be simply understood as a power switching component. Everyone knows the function of the heart, right? Under the action of the heart pump, the heart pushes blood to various organs of the body, supplementing the body with sufficient blood and oxygen. The function of IGBT is somewhat similar to that of the heart, which can adjust the voltage, current, frequency, phase, etc. in the circuit according to the signal instructions in industrial devices, thus achieving precise regulation.

Therefore, IGBT, also known as the "CPU" in the power electronics industry, is widely used in fields such as photovoltaic and wind power equipment, new energy vehicles, industrial control, variable frequency white power, smart grids, and rail transit.

02 IGBT out of stock

Do you still remember the market where there was a severe shortage of cores in the past two years? Especially in the automotive field, the shortage of automotive Chip shortage once limited the production of Alternative fuel vehicle, and became the focus of the market. Is there a new member of the 'out of stock' camp now?

In fact, the gap in IGBT has always existed, and this year's surge in new energy demand has also led to increasing attention being paid to this segmented track.

The first is the increment of Alternative fuel vehicle. IGBT module is the core device of motor controller, on-board air conditioner and Charging station of new energy vehicles, accounting for about 80% of power semiconductors of new energy vehicles, and is a subdivision of the main benefits of automotive electrification. According to EVtank's prediction, the size of China's new energy vehicle IGBT market will reach 16.5 billion yuan in 2025, with a CAGR of 31.48% from 2020 to 2025.

The demand in the photovoltaic field has also greatly promoted the development of the IGBT market. IGBT is the core component of new energy Solar inverter, which fully benefits from the development of wind, solar and storage. According to the prediction of Guosen Securities, new energy power generation will bring about changes in the grid architecture, and photovoltaic, wind power and electrochemical energy storage (photovoltaic wind storage) will open up IGBT application increment. It is estimated that the global market size of IGBT for photovoltaic wind storage will grow from 7.48 billion yuan to 25 billion yuan from 2021 to 2025.

In addition to the field of new energy, another major focus of IGBT applications is in the field of industrial control. From the revenue structure of the first half of last year, it can be seen that the operating revenue from the industrial control and power supply industries is basically the same as that of the new energy industry, both of which are around 550 million yuan.

Driven by the "awesome" downstream of Alternative fuel vehicle, photovoltaic and industrial control, the blowout of IGBT demand seems reasonable.

How long can the prosperity of 03 last?

For investing in an industry, the current excitement is only temporary, and whether it can be laid out or not depends on how long the high landscape can last. We can consider it from two perspectives: short-term and medium to long-term.

Let's look at the short term first. In addition to strong demand, another major bottleneck for IGBT products in short supply is the tight production capacity of upstream wafer factories and packaging. Although many companies have recently started to compete for this "cake", "Rome was not built in a day", and IGBT has a production cycle of about two years, which also means that it will take some time for the industry to accelerate production capacity.

Let's take a look at the long term. The first important factor driving the development of the IGBT industry is its own importance. IGBT combines the advantages of MOSFET and BJT power semiconductor components, and is considered the cornerstone of the development of the new energy industry. It is an essential core component for achieving the "dual carbon" strategy. Under the guidance of the dual carbon policy, the rapid increase in the penetration rate of new energy vehicles and the rapid development of clean energy in China are both the main sources of incremental growth in the IGBT market.

The second important factor driving the development of the IGBT industry is the domestic substitution of "old acquaintances". Although China is the largest demand market for IGBT, the current localization rate is still less than 20%, and there is still great room for improvement in domestic substitution in the future. In the past two years, the epidemic has affected the supply chain of overseas IGBT manufacturers to China, exacerbating the severity of the domestic IGBT demand gap. As a result, downstream customers of domestic IGBT have turned to local suppliers, directly promoting the acceleration of the industry's localization process. Domestic substitution has both space and willingness, naturally becoming an important driving force for industry development.

That is to say, the incremental demand for new energy brought about by the dual carbon strategy, as well as the demand for domestic substitution, will bring huge growth space to the domestic IGBT market. Currently, it may be a good time to lay out the layout. In terms of investment direction, it is recommended that everyone focus on enterprises that have entered the new energy field and enjoy high industry growth rates, especially those specializing in automotive grade IGBTs and third-generation semiconductor power devices.