Union Semiconductor (Hefei) Co., Ltd. received approval for a listing to the Shanghai Sci-Tech Innovation Board (STAR Market) on Wednesday, with sponsor Haitong Security.
With this IPO, Union Semiconductor plans to raise 1.564 billion yuan ($245.5 million), to be used for three purposes: 12-inch display driver chip packaging, R&D center construction, and supplementary working capital.
Founded in December 2015, Union Semiconductor is a packaging and testing service provider of advanced integrated circuits, focusing on the field of display driver chips. The company mainly involves gold bumping manufacturing, and integrates circuit probe (CP), chip-on-galss (COG) packaging and chip-on-film (COF) packaging.
The firm has comprehensive service capabilities of full-process packaging and testing of display driver chips, and those chips are the core components for various products such as smartphones, smart wearable devices, high-definition televisions, laptops and tablets, to realize various display results.
Union Semiconductor’s main customers are display driver chip design companies. During the reporting period, its main customers include Novatek Microelectronics, Fitipower Integrated Tech, Sitronix Technology and Raydium Semiconductor.
According to financial data, Union Semiconductor turned losses into profits during the reporting period. The company achieved revenues of 394 million yuan in 2019, 619 million yuan in 2020 and 796 million yuan in 2021. Meanwhile, the corresponding net profits in the same period were -164 million yuan in 2019, -4.005 million yuan in 2020 and 140 million yuan in 2021 respectively.
However, since its establishment, Union Semiconductor has been focusing on the field of display driver chips, and has not yet carried out business in other fields. During the reporting period, the company’s main business income came from the packaging and testing services of display driver chips, accounting for more than 90% of its operating income. The income structure was relatively simple.
According to statistics compiled by market consulting company Frost & Sullivan, in 2020, global display driver chip shipments totaled about 16.54 billion units, while Chinese mainland companies’ display driver chip shipments were about 5.270 billion. In 2020, Union Semiconductor showed that its shipments of driver chips amounted to 828 million, and its global market share was about 5.01%, while its market share in the Chinese mainland was 15.71%.