Global semiconductor stocks have continued their rally on the artificial intelligence (AI) boom, but valuation concerns are mounting after the short-term surge. Amid this, an exchange-traded fund (ETF) tracking Japanese semiconductor materials, components and equipment companies expected to benefit directly from expanding capital expenditure (CAPEX) is drawing attention with stable performance.
According to Korea Fund Rating's FundSquare on the 10th, the "PLUS Japan Semiconductor Materials-Components-Equipment ETF" posted returns based on net asset value (NAV) of 7.42% over one month, 17.75% over three months and 104.54% over one year as of the previous day. The fund recorded solid performance even during a period when major domestic semiconductor-related ETFs underwent a corrective phase.
The ETF holds Japan's leading semiconductor equipment company Tokyo Electron and semiconductor testing equipment maker Advantest as major constituents. Tokyo Electron is the world's fourth-largest company by front-end equipment revenue and holds a market share of more than 90% in the photoresist processing equipment market. Advantest holds a 61% share of the semiconductor test equipment market, and its competitiveness in the back-end segment is gaining prominence with the expansion of advanced packaging.
Japan's high global market share is cited as the reason its semiconductor materials, components and equipment sector is competitive. According to the Korea Trade-Investment Promotion Agency (KOTRA), Japan ranks first in the world with a 48% share of the global semiconductor materials market, and second after the United States in the equipment market with a 31% share. This means it has built a core supply chain that is difficult to replace within the semiconductor value chain.
Analysts project that the benefits will grow as global semiconductor capital expenditure increases. Market research firm Gartner forecast that global semiconductor capital expenditure will rise 16.4% this year from last year and increase another 11.2% in 2027. Continued policy support is also cited as a positive, with the Japanese government deciding to invest 10 trillion yen (about 96 trillion won) by 2030 to foster the semiconductor industry.
"In a phase where major semiconductor companies increase capital expenditure amid expanding investment in AI servers and data centers, expectations for orders and earnings at equipment and materials companies also rise together," said Kim Jung-seop, head of the ETF business division at Hanwha Asset Management. "PLUS Japan Semiconductor Materials-Components-Equipment is a product that allows investors to expect both global semiconductor value chain investment and country diversification effects at the same time."
