1. Samsung May Miss Indian Rupees 9 billion Subsidy Due to Invoice Problems

In August 2020, India launched the Production-Related Incentive (PLI) scheme to encourage large-scale electronics manufacturing. Samsung, a major contributor to the scheme, is facing potential challenges in receiving a subsidy of Rs 9 billion for 2021 due to issues with their invoices. However, Samsung has assured that they are actively engaged in discussions with the Indian government to resolve the matter.

The primary objective of India’s PLI program is to attract both global and local mobile phone and component manufacturers, including Samsung and iPhone assemblers like Foxconn and Pegatron, to invest and manufacture their products in India. Samsung claims that their installed capacity in Grand Noida, India, has led to additional sales of INR 150 billion (US $1.81 billion) in fiscal year 2021 compared to the base year of fiscal year 2020. As a result, they should be eligible for incentive payments of INR 9 billion in the first year of the scheme.

While the approval of spending for the first year is expected to be granted by the end of 2022, Samsung has yet to receive the INR 9 billion subsidy they are entitled to. According to a senior official, Samsung faced valuation issues with their invoices in fiscal year 2021 but has taken corrective measures since fiscal year 2022. Consequently, Samsung will not receive subsidies in the first year but is anticipated to receive them starting from fiscal year 2022. A spokesperson for Samsung has confirmed that they are currently at an advanced stage of discussions with the Indian government to address the situation.

Under the PLI program, approved participants are required to meet specific criteria pertaining to additional investment and sales in the base year. While contract manufacturers like Foxconn find it relatively straightforward to evaluate invoice values, the process may differ for manufacturers like Samsung, potentially leading to complications.

2. DDR prices have slightly adjusted this week

According to the CFM flash market, there have been minor adjustments in DDR prices this week. NAND Flash Wafer prices have remained stable without any changes. Specifically, after the trading in May, prices for DDR4 16Gb 3200, DDR4 16Gb eTT, and DDR4 8Gb 3200 have slightly decreased from 2.65 to 2.38 to $1.70. However, prices for other DDR variants have remained unchanged. Overall, the storage market is showing steady performance, but the current demand has not met expectations, resulting in a lack of improvement in market flow rates for the time being.

3. SSD prices continue to hit a new low

According to the Nikkei news, due to weak PC demand, SSD prices continued to fall and hit record lows.Data show that the wholesale price of SSD indicator product TLC256GB (block trading price) during the period of April-June 2023 is about $25 each, down 7% (down 2 US dollars) compared with the previous quarter (January-March 2023), down for the seventh consecutive quarter, and hit a record low for the fifth consecutive quarter; This represents a 25% drop ($8.50) from a year earlier. However, with the decline in demand, storage manufacturers are reducing production of SSD key parts NAND Flash, SSD prices are expected to stop falling. Most market participants expect SSD prices to bottom out in Q3 2023.

4. TSMC: Evaluating Second Japanese Plant

According to Taiwanese media sources, Tepco has established a factory in Kumamoto, Japan, and is scheduled to commence production in 2024. The company’s chairman, Liu Deyin, has confirmed that the evaluation for a second factory is currently underway, and it will also be situated in Kumamoto, focusing primarily on mature processes rather than advanced ones. TSMC, a key customer, has acquired land for the first factory, while the land acquisition process for the second factory is still in progress within Kumamoto. Due to concerns from several customers regarding TSMC’s capacity for mature processes, the second plant in Japan is being evaluated with a similar focus, without immediate plans to introduce advanced processes.

5. Q1 Global Shipments of Semiconductor Equipment Valued at $26.8 billion

In the first quarter of 2023, global semiconductor equipment shipments reached $26.8 billion, as stated in the SEMI report. This represents a 9% increase compared to the same period last year, although there was a 3% decline compared to the previous quarter. Ajit Manocha, the President and CEO, commented on the report, noting that despite the challenging industry environment and macroeconomic downturn, semiconductor equipment shipments remained strong. He further emphasized that the fundamental support for long-term strategic investments, necessary for driving advancements in AI, automotive, and other growth applications, remains healthy.

6. Q1 Global smart phone production hit a new low

Global smartphone production in the first quarter of 2023, as reported by TrendForce, reached 250 million units, marking a 19.5% decline compared to the same period in 2022. For the second quarter, smartphone production is expected to reach 260 million units, showing a nearly 10% decrease year-on-year but supported by seasonal demand.

Global smartphone production in Q1 2023 saw a decline, with Samsung producing 61.5 million units and Apple manufacturing 53.3 million units. However, OPPO (including realme) produced 26.8 million units and is expected to see a 25% growth in Q2. Xiaomi’s production was 26.5 million units, with limited growth projected for Q2. Vivo’s production declined in Q1 but is expected to grow by around 10% in Q2.