Stada Semiconductor's 1.5 Billion Yuan Convertible Bond Plan Approved for Registration

On the evening of March 11, Stada Semiconductor announced that the company recently received the “Approval for the Registration of Convertible Corporate Bonds Issuance to Unspecified Objects” issued by the China Securities Regulatory Commission, approving the company’s registration application for the issuance of convertible corporate bonds to unspecified objects.

According to the draft of the fundraising prospectus for the convertible bonds, the company plans to raise no more than 1.5 billion yuan, which will be invested in the automotive-grade SiC MOSFET module manufacturing project, the IPM module manufacturing project, the automotive-grade GaN module industrialization project, and additional working capital.

Since its establishment, the company has focused on the design, development, production, and sales of power semiconductor chips and modules mainly based on IGBT and SiC. In the SiC field, the company has consecutively secured several domestic and international SiC MOSFET main motor controller projects since 2020, and in 2022, achieved the first batch installation of an 800V high-voltage SiC main motor controller platform domestically. Currently, the company’s automotive-grade SiC MOSFET chips and modules are already mass-installed in multiple vehicle models from major domestic and international automakers, with product sales continuing to grow rapidly.

Industry data from Omdia shows that in 2023, the global power semiconductor market size is approximately $50.3 billion, expected to grow to $59.6 billion by 2027.

Regarding the purpose of this issuance, Stada Semiconductor explained that through the implementation of the automotive-grade SiC MOSFET module manufacturing project and the automotive-grade GaN module industrialization project, the company will leverage its industry position and technological advantages in the new energy vehicle sector, seize the historical opportunity of rapid development in the new energy vehicle field, and meet customer demands for third-generation automotive-grade power modules in terms of technology and market.

At the same time, the company stated that by implementing the IPM module manufacturing project, it will rely on its existing high-quality customer base in the home appliance industry to accelerate the market penetration of IPM modules in the white goods sector, promote large-scale supporting production in applications such as variable frequency white appliances, and further enhance the company’s market share and industry position in the white goods field.

Regarding benefits, it was disclosed that the construction period for the automotive-grade SiC MOSFET module manufacturing project is three years, with an internal rate of return (IRR) of 18.45% (after tax). The expected payback period (after tax) is 7.88 years (including a 3-year construction period).

The construction period for the IPM module manufacturing project is four years, with an IRR of 16.00% (after tax). The expected payback period (after tax) is 8.46 years (including a 4-year construction period). The automotive-grade GaN module industrialization project also has a construction period of four years, with an IRR of 18.73% (after tax), and an expected payback period (after tax) of 8.06 years (including a 4-year construction period).

Regarding the impact on the company’s finances, Stada Semiconductor believes that it takes time for the new projects to generate benefits. If the conversion of the issued convertible bonds occurs quickly and the invested projects’ benefits are not fully realized, there may be a short-term slight decline in financial indicators such as earnings per share. However, as the funds raised are invested in the orderly development of these projects, the company’s strategic goals will be effectively implemented, and its future profitability and operating performance are expected to improve.