On the evening of August 4, 2026, the National Integrated Circuit Industry Investment Fund Phase III (referred to as "Fund Phase III") officially announced its first-round investment list, with a total investment scale exceeding 200 billion RMB, focusing on three major sectors: semiconductor equipment, materials, and advanced packaging. This represents the largest single investment since Fund Phase III's establishment in 2024 and is seen by the market as a clear signal that China's chip industry has entered a "deep cultivation phase".
Event Review: Who Received the First Round of Funding from Fund Phase III?
This first-round investment from Fund Phase III involved dozens of leading companies in various sectors, including 30 billion RMB for Beijing Naura (a leading semiconductor equipment company), 20 billion RMB for Naura Microelectronics, 12 billion RMB for TUZHI Technology (specializing in thin-film deposition equipment), 15 billion RMB for Shanghai Silicon Industry (a silicon wafer giant), and 8 billion RMB and 6 billion RMB respectively for JCET and TFME (advanced packaging companies). Additionally, several EDA and core component manufacturers were also on the list.
Notably, this round of investment did not follow the pattern of Phases I and II, which focused primarily on wafer manufacturing, but instead allocated over 70% of the funds to equipment and materials. Industry experts point out that this represents a targeted national response to the "choke point" challenges. Against the backdrop of surging AI computing power demand and global supply chain restructuring, the domestic production of equipment and materials has shifted from an "option" to a "necessity".
Why Invest in Chips? Three Fundamental Logic Remain Strong
For investors, the movements of Fund Phase III serve as the strongest "investment thesis." Overall, the fundamental logic behind chip investment has not changed; instead, it has been continuously strengthened by the resonance of external pressures and internal policies.
Logic One: Unprecedented Policy Support Comparable to "National-Level Escort"
From Phase I in 2014 mobilizing over 500 billion RMB in social capital, to Phase II focusing on manufacturing, to Phase III investing in equipment and materials, national determination has been consistent throughout. Since 2026, the Ministry of Finance and the State Taxation Administration have further extended tax incentive periods for integrated circuit enterprises, while the STAR Market has relaxed listing requirements for unprofitable chip companies. Policy dividends will continue to be released.
Logic Two: Huge Potential for Domestic Substitution, Evolving from "Functional" to "High-Performance"
Currently, China has established certain competitiveness in semiconductor design, but the self-sufficiency rate for equipment and materials remains below 20%, with core segments like photoresists, high-pressure chemical vapor deposition equipment, and electronic specialty gases relying heavily on imports. The investment from Fund Phase III is expected to drive key technologies from laboratories to production lines, opening up incremental markets worth hundreds of billions of RMB.
Logic Three: AI and Automotive Electronics Driving Demand Cycle Upward
The global semiconductor market size is projected to exceed $700 billion in 2026, with AI acceleration chips, automotive-grade power semiconductors, and CIS sensors becoming the fastest-growing segments. TSMC's 3nm capacity utilization exceeds 95%, and memory chip prices have bottomed out and rebounded, all confirming strong demand-side recovery. Chips are not a sunset industry but the "new oil" of the intelligent era.
Equipment and Materials: The "Hard Nut" and "New Rich Mine" of Domestic Substitution
The capital allocation direction of Fund Phase III this round outlines two golden investment tracks for investors.
- Semiconductor Equipment: Domestic substitution rates for etching machines, thin-film deposition equipment, and cleaning equipment are rapidly increasing. Leading companies like Beijing Naura and Naura Microelectronics have entered the verification stage for 14nm and below processes, with bulk orders expected to be placed around 2027.
- Semiconductor Materials: Consumables like large silicon wafers, photoresists, electronic specialty gases, and CMP slurries benefit from wafer fab expansion. The large silicon wafer capacity of companies like Shanghai Silicon Industry has been secured through long-term agreements.
- Advanced Packaging: As Chiplets become mainstream in the post-Moore era, advanced packaging value has doubled. JCET and TFME are deeply investing in 2.5D/3D packaging.
Southeast Asian Perspective: How Thailand Can Capture "Spillover Dividends"
The investment from Fund Phase III does not mean a closed development approach to domestic substitution; instead, it will accelerate the transfer of China's mature process capacity to Southeast Asia, forming a collaborative pattern of "design in China, manufacturing in ASEAN." As one of the countries with the most complete semiconductor industry chain in Southeast Asia, Thailand is attracting the establishment of joint venture packaging and testing factories and material plants with Chinese enterprises through new BOI policies.
In the first half of 2026, Thailand's EEC semiconductor cluster has added 12 foreign-invested projects, 6 of which are from mainland China and Taiwan, focusing on packaging and testing as well as power devices. For investors following the Thai stock market, local Thai packaging and testing companies, thermal management materials, and PCB supply chain enterprises may experience a second growth curve.
Investment Tips: Embrace the Main Trend, Beware of Valuation Bubbles
Amid the enthusiasm for chip investment, we still need to think calmly. The semiconductor industry has strong cyclical characteristics, and inventory changes, overcapacity, and technology route iterations can all lead to pullbacks. The positive news from Fund Phase III has already been partially reflected in stock prices. Investors are advised to focus on companies with genuine technical barriers and visible order pipelines, avoiding chasing pure concept stocks at high valuations.
In the long term, the chip industry is the foundation of the digital economy, and the resonance of policy, demand, and innovation provides fertile ground for excess returns for investors. Whether in the A-share market or Thailand's SET market, the semiconductor sector deserves to be allocated as a core asset for the long term.
(This article is compiled based on public market information and does not constitute investment advice)
