Related Stocks Bloom Amid FC-BGA Supply Shortage

Samsung Electro-Mechanics Rises 14.4% in One Month

[Asia Economy Reporter Minji Lee] As the supply shortage of semiconductor substrate flip-chip ball grid array (FC-BGA) products is expected to prolong, investor interest is rising in companies that have decided to invest in facilities.

As of 9:40 a.m. on the 28th, Samsung Electro-Mechanics recorded a steady price of 194,500 KRW. However, its one-month growth rate was 14.4%. The recent announcement to invest 1 trillion KRW in the FC-BGA substrate production line served as a momentum. FC-BGA is a broad component that connects semiconductor chips and substrates to the mainboard using ball-shaped bumps. It is mainly used in semiconductors with high electrical signals such as central processing units (CPU), graphics processing units (GPU), and server DRAM. Recently, due to the growth of data centers, artificial intelligence (AI), and electric vehicle markets, the demand for substrates from semiconductor companies like Intel, AMD, and Nvidia has surged.

To meet demand, supply must increase, but since it requires top-tier technology, the number of suppliers is limited. This is why the unit price of FC-BGA has risen about 30% this year alone. Kim Jisan, head of Kiwoom Securities Research Center, said, "As FC-BGA package technology evolves, manufacturing difficulty increases, and the supply shortage will continue until 2026," adding, "The market is expected to grow at an average annual rate of over 14% in the mid to long term."

As the supply shortage continues, investment sentiment is gathering around companies that have decided to make new investments in FC-BGA. Foreign investors have been actively buying Samsung Electro-Mechanics (56.8 billion KRW), Daeduck Electronics (35.5 billion KRW), and LG Innotek (27.8 billion KRW) since last week, placing them among the top 10 net purchase stocks. Daeduck Electronics announced on the 13th that it would make an additional 100 billion KRW investment in FC-BGA facilities, after which its stock return reached 17%. LG Innotek also announced its new entry into the FC-BGA market, with its stock price rising 21% in one month.

As major companies rush to invest in facilities, interest is also increasing in companies supplying materials, parts, and equipment to package substrate manufacturers. Solderable, produced by Duksan HiMetal, is a key component used in semiconductor packaging processes and is expected to benefit from the growth of the upstream industry. The company's stock price has risen 34% in one month.