The global semiconductor packaging equipment market is reckoned to swell at a CAGR of 8.04% during the period 2016-2020.
According to the latest report of Research and Markets – “Global Semiconductor Packaging Equipment Market 2016-2020” – The market is expected to gain ground in 2017 due to the evolution of the IoT, high demand for connected devices, and automation in automobiles.
To tap the growing demand, semiconductor device manufacturers are increasing their capital spending by expanding their production facilities or constructing new fabs. The majority of the investment in new facilities will be toward the development of memory and logic ICs due to their high demand pattern.
Commenting on the report, an analyst from the research team said, “One of the key trends for market growth will be growing number of mergers and acquisitions. The number of mergers and acquisitions is growing in the global semiconductor packaging and assembly equipment market.”
According to the report, growing number of fabs will be a key driver for market growth. The rising demand for semiconductor chips and memory devices from electronics end-user devices, sensor systems, IoT-connected devices, and medical devices is propelling the semiconductor industry on the high growth trajectory. However, the industry will slow down in 2016 mainly due to its cyclical nature, slow growth of the Chinese economy, falling ASPs of smartphones, and declining tablet and PC segments.
The existing vendors are focusing on M&A to increase their market share. For instance, in 2015, ASE agreed to buy a 24.99% stake in SPIL, a provider of advanced packaging solutions, for more than $919 million. Earlier in 2015, SPIL and Hon Hai Precision Industry announced a stock swap to strengthen their product offerings in SiP technology. New entrants in the market also prefer M&A in order to enter in the already highly competitive market.