Research Brief | Blue Arrow Electronics Hosts Kunyu Fund and 5 Other Institutions, Focusing on Advanced Packaging Technology and Automotive-Grade Product Layout

On March 12, Foshan Blue Arrow Electronics Co., Ltd. (hereinafter referred to as “Blue Arrow Electronics”) hosted a targeted research and on-site visit with six institutions, including Shenzhen Kunyou Fund Management Co., Ltd. and Shenzhen Qianhai Hongfu Investment Management Co., Ltd. The company’s director, deputy general manager, and board secretary Zhang Guoguang, along with securities affairs representative Lin Pinwang, attended the event. They engaged in in-depth discussions with institutional investors on core issues such as product structure adjustments, advanced packaging technology applications, high-end customer expansion, capital operation plans, and the impact of industry price increases.

Basic Information of Investor Activities

Key Points of the Research Interpretation

Product Structure Optimization: Focus on High-Value-Added and Automotive-Grade Products

In response to concerns about product structure adjustments and competitiveness enhancement, Blue Arrow Electronics stated that the company will focus on optimizing its product mix, increasing the proportion of high-power-density and high-value-added products. The core development directions include automotive-grade power devices, third-generation semiconductor packaging, and advanced packaging-related products. R&D investments will concentrate on miniaturization, high-power-density packaging, automotive-grade packaging, SIP system-level packaging, DFN/QFN and other advanced packaging processes to improve technical performance. Meanwhile, the company will strengthen its proprietary brand profit margin advantages, optimize the discrete device and integrated circuit product systems, and promote process improvements and customer structure adjustments in packaging and testing services, leveraging the synergy of “own brand + packaging and testing services.”

Advanced Packaging Technology: Mastery of Multiple Key Processes and Breakthroughs in Ultra-Thin Packaging

Regarding the application of advanced packaging technology, Blue Arrow Electronics introduced that it has already deployed technologies such as DFN, PDFN, QFN, TSOT, and System-in-Package (SiP). The company has successfully applied key processes including ultra-thin chip packaging, SiP, flip-chip bonding, and copper bridge bonding. Notably, the Clip Bond technology can significantly enhance product current capacity and heat dissipation performance, while Flip Chip technology enables smaller package sizes and higher reliability. SiP technology meets multi-chip integration needs. It is worth noting that the company has broken through industry challenges in ultra-thin packaging, achieving thicknesses of 80-150μm, mainly serving power and power management chips.

High-End Customer Expansion: Focusing on Emerging Fields and Meeting Top Customer Demands

Facing opportunities for domestic substitution, Blue Arrow Electronics stated it will continue to increase investment in advanced packaging technologies, improving product performance around miniaturization, high power density, and automotive-grade packaging to meet high-end customer demands for high reliability and high integration. The company will focus on emerging high-growth fields such as new energy vehicles, industrial control, 5G base stations, and IoT, accelerating the integration of automotive-grade and industrial-grade products into key application scenarios in these areas, and deepening cooperation with leading customers. Relying on its core “discrete devices + integrated circuits” packaging and testing system and full-process wafer coverage from 4 to 12 inches, the company aims to provide integrated solutions for high-end customers in discrete devices and ICs.

Capital Operations: Promoting Industry Chain Extension, Prudent Planning for Mergers and Acquisitions, and Financing

Regarding capital operation plans, Blue Arrow Electronics said it will focus on extending the industry chain upstream and downstream and synergizing with its main business. Future M&A and equity investments will be carried out prudently according to development strategies. The acquisition of Chengdu Xinying is currently in progress, aiming to extend the industry chain into chip design and promote the company’s development from solely packaging and testing toward a “design + packaging and testing” collaborative model. Additionally, the company will plan financing reasonably based on business development, project construction, and capital needs, implementing a centralized, steady, and prudent capital management approach to ensure funding for capital deployment and maintain a healthy financial structure.

Impact of Industry Price Increases: Fine-Tuned Pricing Transmitting Cost Pressures, Growing Demand Driving Order Expansion

In response to the impact of rising prices and industry prosperity in the power semiconductor sector, Blue Arrow Electronics stated that it adopts strategies such as cost-plus pricing, differentiated pricing, and refined pricing based on customer and product categories. These strategies help moderately pass on cost pressures from raw materials like copper and gold, and enable precise pricing for high-value power semiconductor products. Currently, demand for power devices continues to grow, especially in new energy, industrial control, and 5G communications. The company is steadily advancing customer certification and market entry for industrial and automotive-grade power devices, actively expanding customer bases and orders in these fields.

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