BUSINESS

[Newsmaker] Excitement rises over Samsung chip investment

By Korea Herald
  • Published : Mar 15, 2017 - 18:28
  • Updated : Mar 16, 2017 - 11:20
The amount Samsung Electronics will invest in the booming semiconductor business this year is being widely discussed among related industries and the financial market, even though the world’s top chipmaker has yet to announce its final plan.

According to the semiconductor industry on Wednesday, Samsung is currently looking at its annual investment plan, which includes building a new production line within the current 17 Line in the company’s Hwaseong Campus in Gyeonggi Province, and constructing a whole new plant in a parking lot area next to the 17 Line for new products.

There are mixed views about the purpose of the new line and plant, with some saying Samsung would expand its DRAM production amid the rising demand, and some others betting on System Large Scale Integrated Chips.

The investment amount for the new construction over the next two years is forecast to be 8 to 10 trillion won ($7 to 9 billion), according to several media reports.

(Samsung Electronics)

“It is too early to confirm anything about the plan, including which product the new line is going to be built for,” said a Samsung spokesman. “A detailed plan may be announced later this month or early April when it is finalized.”

Samsung had expanded the Hwaseong 17 Line twice as of last year. It currently produces DRAM and 3-D NAND Flash chips.

According to industry sources, the 17 Line was initially constructed for system chips only, but with the expansion of the DRAM and 3D NAND Flash lines, it is now operating as a multi-purpose production line.

Some speculate that that the expansion of the 17 Line would be for 10-nanometer system chips, while the new factory is expected to be used for the production of 7-nm chips.

Upon industry speculations, financial analysts forecast that Samsung’s investment in the overall semiconductor business would rise noticeably with some adjustment in operations and functions of productions lines this year.

“Samsung Electronics’ new investment is forecast to be around 15 trillion won this year, up from 13 trillion won last year,” said Hwang Min-seong, an analyst at Samsung Securities. “The company is expected to invest 5 trillion won in DRAM production and 10 trillion won in NAND.”

Due to high expectations on an increased investment by Samsung, local semiconductor equipment manufacturers are likely to see stock rallies, the analyst added.

A global market researcher, IC Insights, said early this month that Samsung’s investment in the chip business would rise from about 11 percent last year to 14.5 trillion won this year.

According to ETnews, a local publication that specializes in IT, Samsung recently ordered new equipment for 10-nm system LSI chips.

“At the earliest, new equipment is expected to be installed starting next month and completed by June,” the report said.

By Song Su-hyun (song@heraldcorp.com)