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Strong IC substrate shipments continue to buoy Nan Ya, Kinsus

Nan Ya PCB and Kinsus Interconnect Technology continued to see their May sales driven by robust shipments of IC substrates, and are both poised to enjoy a strong 2021, according to industry sources.

The outlook for IC substrate demand particularly that for ABF substrates appears promising, thanks to demand arising from the emerging 5G, AI and HPC device applications, said the sources. The supply of ABF substrates has been tight, while the visibility of orders for BT-based substrates has already extended to the second half of this year, the sources indicated.

Kinsus has reported revenue grew 22.3% on year and 5.2% sequentially to a record high of NT$2.88 billion (US$103.7 million) in May 2021. Revenue totaled NT$12.83 billion for the first five months of this year, rising 24.5% from the same period in 2020.

Kinsus disclosed previously plans to expand production capacity for ABF substrates by 30%, and that for BT substrates by 10%, in 2021. The additional capacity will come online at its newly-acquired plant in Yangmei, northern Taiwan, in the second half of this year.

Market watchers expect Kinsus to post a 5-10% sequential increase in second-quarter revenue, judging from the chipmaker's available ABF and BT substrate capacity that has been fully utilized. With clear order visibility through the second half of 2021, Kinsus is set to post sequential revenue increases through the fourth quarter of the year, according to the watchers.

Nan Ya has reported revenue climbed 40.3% from a year earlier to nearly NT$4.1 billion in May 2021. The company's cumulative 2021 revenue through May increased 38.6% on year to about NT$19.1 billion.

Nan Ya plans to invest a total of NT$8 billion to expand production capacity for ABF substrates at its factory site in Shulin, northern Taiwan, with the additional capacity set to arrive by the first quarter of 2023. Coupled with additional capacity now being commercialized at its plant in Kunshan, China and new capacity to be available by early 2022 at its plant in Taoyuan, northern Taiwan, Nan Ya will boost its overall ABF substrate capacity by 40% compared to the 2020 level, the company was quoted as saying in previous reports.