Weekly Global Update for March 27, 2013

Japanese Electronics Update

JEITA and JPCA just released the January 2012 Japanese Electronics Production

• Electronic equipment shipments decline 25% in January 2013 compared to January 2012 (Chart 1) as all product groups declined (Chart 2).
• Printed circuit board domestic production continued to deteriorate (Chart 3) as the PCB 3/12 growth rate dropped to 0.77 (Chart 4). This means that Japanese PCB production was down 23% in the 3-month period ending in January 2013 compared to the same period a year earlier.
• Electronic component growth was down 1% and device growth was down 5% on a 3-month (3/12) basis (Chart 5).

Source: www.jeita.or.jp

World Semiconductor Equipment Shipments by Major Country

Fourth quarter SEMI capital equipment shipments by major country were just released (Chart 6). After showing some signs of recovery in mid-2012, SEMI equipment shipment growth deteriorated at year end while chip shipment growth improved (Chart 7).

Sources: www.seaj.or.jp and www.sia-online.org

North America Semiconductor Equipment Industry Posts February 2013 Book-to-Bill Ratio of 1.10 (Charts 8 & 9)

North America-based manufacturers of semiconductor equipment posted $1.07 billion in orders worldwide in February 2013 (3-month average basis) and a book-to-bill ratio of 1.10, according to SEMI.

The 3-month average of worldwide bookings in February 2013 was $1.07 billion, 0.2% lower than January 2013, and 19.7% lower than the February 2012.

The 3-month average of worldwide billings in February 2013 was $975.3 million, 0.8% higher than January 2013, and 26.3% lower than the February 2012.

"Three-month average bookings and billings posted by North America semiconductor equipment providers remain above parity and consistent with prior month levels," said Denny McGuirk, president and CEO of SEMI. "We expect modest investment by semiconductor makers in the first half of the year with foundry and advanced packaging technology among the near-term spending drivers.”

Source: www.semi.org

Japanese SEMI Book-to-Bill Ratio Almost Flat in February (Chart 10 – plotted using 1-month data)

Japan's semiconductor production equipment manufacturers posted a book-to-bill ratio of 1.17 in February 2013, compared to 1.18 in January, according to the Semiconductor Equipment Association of Japan (SEAJ).

Orders for semiconductor equipment made in Japan grew 7% sequentially to JPY79.5 billion (US$839.4 million) in February, according to SEAJ. Compared to the JPY99.8 billion posted in February 2012, the bookings figure represented a 20.3% decline.

The 3-month average of worldwide billings in February 2013 was JPY68.23 billion, up 8.3% from the revised level of JPY62.98 billion in January, but down 33% from JPY101.79 billion a year earlier.

Source: www.seaj.or.jp

India's Leading PCB Manufacturers

The Indian printed circuit boards (PCBs) industry has witnessed rapid changes in the last few years with the entry of foreign players in the Indian market, who manufacture multi-layer PCBs in large quantities. At the same time, home grown companies have also technologically upgraded themselves to become more competitive in price.

According to the Indian Printed Circuit Association (IPCA), demand for PCBs is expected to increase by 20% not only in India, but even across the globe, in the next few years, further widening the demand and supply gap.

Although India currently has about 60 large and medium sized PCB manufacturing plants, lack of relevant policies result in insufficient investments in PCB manufacturing. This is also one of the reasons for the short supply of PCBs in India. It is, therefore, necessary for Indian PCB makers to think strategically to not only meet domestic demand, but also compete in the world market. Hopefully, with the announcement of the new manufacturing policy, the growth of the Indian PCB industry is likely to accelerate as many companies are likely to expand their production capacities.

Leading PCB manufacturers in India (in alphabetical order)

Ascent Circuits Pvt Ltd
Austria Technologie & Systemtechnik (AT&S)
BLG Electronics Ltd
CIPSA Tech India Pvt Ltd
Circuit Systems (India) Ltd
DMS Technologies Pvt Ltd
Epitome Components Ltd
Fineline Circuit Company
Garg Electronics
Genus Electrotech Ltd
Micropack Limited
Shogini Technoarts Pvt Ltd

Source: electronicsb2b.com/

India's Top 20 EMS Players

"The Indian electronics industry, reportedly worth US$ 1.75 trillion, is the largest and fastest growing manufacturing industry in the world. It is expected to reach US$ 2.4 trillion by 2020. The demand in the Indian market was US$ 45 billion in 2008-09 and is expected to reach US$ 400 billion by 2020,” reads the Draft National Policy on Electronics, 2011.

Electronics Bazaar has attempted to rank the leading EMS players based on their revenue, to ascertain their growth. The revenues of these companies have been procured from the website of the Ministry of Corporate Affairs (MCA), Government of India. Some of the companies could not be included as their revenues for the FY 2009-10 were not available.

Source: www.eb.efyindia.com/

EMS Medical Market Revenue $16.56 billion in 2012 and Expected to Grow at CAGR of 11.0% between 2012 and 2019

The pervasiveness of electronics in the medical industry is intensifying rapidly. The use of wireless communications, robotics, and software in this sector is expected to grow rapidly in the next three to four years.

At the same time medical original equipment manufacturers (OEMs) are under increasing pressure to restructure their growth strategies and product portfolios. Increasing demand for affordable medical devices, convergence of electronics, and rising cost pressures have helped bolster electronics manufacturing service (EMS) providers' participation in the last few years.

Medical OEMs have the requisite knowledge of designing, marketing, and other core competencies. However, they require continuous investment to keep pace with advancing electronic content in medical devices and with manufacturing and quality tools. EMS providers have the ability to offer effective solutions to lower cost, while increasing quality, efficiency, value of innovation, time-to-market and supply chain management.

Source: www.frost.com

Worldwide External Controller-Based Disk Storage Market Grew 1.9% in 4Q’12 (Charts 11 & 12)

Worldwide external controller-based (ECB) disk storage vendor revenue totaled $6.0 billion in the fourth quarter of 2012, a 1.9% increase from revenue of $5.9 billion in the fourth quarter of 2011, according to Gartner, Inc.

"The fourth quarter 2012 results represent the 13th consecutive quarter of revenue growth, said Roger Cox, research vice president at Gartner.” However, the anemic year-over-year 1.9 percent growth is a reflection of the dour macroeconomics in North America and in Europe, as well as a slowing economy in the Asia/Pacific region."

Source: www.gartner.com