Cathay Pacific Haitong: Proposals to boost semiconductor equipment prosperity focus on a definitive direction

The Zhitong Finance App learned that Cathay Pacific Haitong released a research report saying that China's semiconductor equipment will still be in a boom cycle in the next 2-3 years. The core growth engine comes from the structural expansion of advanced manufacturing processes, advanced storage and advanced packaging, and the continued increase in domestic equipment market share. The definitive direction suggests focusing on manufacturers related to etching, film deposition, cleaning, CMP, etc., elastic measurement testing, advanced packaging equipment, and high-end testing equipment, which is a direction worth paying attention to.

Cathay Pacific Haitong's main views are as follows:

The capital expenditure of major overseas companies jumped in 2026 and is expected to continue to accelerate in 2027

According to the latest management standards, it is estimated that the four major cloud vendors plus Oracle's capital expenditure in 2026 is about 790 billion US dollars. The sharp increase in capital expenditure of major overseas manufacturers already strongly indicates that the semiconductor industry will enter a new cycle of major demand.

Storage is the most deterministic downstream increment, and advanced processes expand simultaneously

By driving the simultaneous increase in GPU shipments and single-card memory capacity, AI directly drives HBM demand, and uses server memory expansion and HBM production capacity extrusion effects to further drive overall DRAM demand and prosperity upward.

SEMI forecasts show that the global semiconductor manufacturing equipment market is entering a new upward cycle driven by AI computing power, advanced logic, and storage production expansion

Global equipment sales are expected to increase from US$134.7 billion in 2025 to US$165.9 billion in 2026, an increase of 23.2% year over year, and further reach US$201.2 billion and US$229.5 billion in 2027 and 2028, with a compound growth rate of about 19.5% in 2025-2028.

Risk Alerts

Downstream capital expenditure falling short of expectations; risk of cycle fluctuations in the semiconductor industry; risk of technology development and iteration; risk of falling short of expectations in customer verification; risk of increasing market competition; risk of increased market competition; risk of international trade and export control; risk of supply of core components; risk of high customer concentration; risk of mismatch between order and revenue confirmation; risk of R&D investment and talent loss; risk of insufficient profitability; risk of accounts receivable and cash flow risk; risk of valuation fluctuations; risk of information and forecast bias.