Potential of CMOS Image Sensors in Automotive Industry

Potential of

CMOS Image Sensors in Automotive Industry

ADAS & AUTONOMOUS

Nov. 2016

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Safe Harbor Notice

KINGPAK’s statements of its current expectations are forward-looking statements subject to significant risks and uncertainties and actual results may differ materially from those expressed or implied in these forward-looking statements for a variety of reasons, including but not limited to, among other things: the cyclical nature of our industry; our dependence on introducing new products on a timely basis; our dependence on growth in the demand for our products; our ability to compete effectively; our ability to successfully expand our capacity; our dependence on key personnel; general economic and political conditions, including those related to the electronic device industries; possible disruptions in commercial activities caused by natural and human-induced disasters, including terrorist activity and armed conflict; and fluctuations in foreign currency exchange rates.

Except as required by law, we undertake no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.

Ⅰ Climate Analysis

Ⅱ Segmentation, Targeting and Positioning A. Automotive B. Security and Surveillance

Ⅲ Target Customers Analysis

Ⅳ Kingpak Company Analysis

Ⅴ Kingpak Competition Analysis

Ⅵ Performance Updated

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Index:







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Index:

★

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Market TAM:

1. 2014: $9.3B; 2015: $10.3B

2. Automotive CAGR(2015-2021) in $ ~23%

1. CMOS Image Senor Market(in $%)

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Market TAM:

1. 2015: $10.3B; 2021: $18.77B

2. CAGR(2015~2021) in Revenue: 10.40%

1. CMOS Image Senor Market(in $M)

„15~‟21 Automotive Revenue CAGR 23%

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Market TAM:

1. 8.0B unit market by 2021

2. CAGR(2015~2021) in Unit: 8.95%

2. CMOS Image Senor Market (in unit)

„14~‟20 CAGR for Automotive(41%) & Security(34%)

8.0 billion Unit Market by

2021

„15~‟21 CAGR for Automotive(25%) & Security(15%)

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3. Who Are Major Players & Ranking (by Revenue)

SONY #1 in CCD Image sensor; leading BSI technology for Apple

SAMSUNG #1 Smartphone market share, plus leading Semiconductor Technology

OVT Working with TSMC, 1st BSI release for Apple, leading in low-end market

ON SEMI Merged Aptina in 2014, with a focus on Automobile & Security areas







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Index:

★

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How we target and position our market

A. CIS CAGR is higher than average 11% and market size is adequate

B. Entry barrier is higher

C. Free from "commodity trap"

A. Automotive

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1. CMOS Automotive Camera Market (M units)

1. In 2015 the average number of camera per car is almost 1.0.

2. By 2021, roughly 3.5 cameras per car.

3. Some cars will require +10 cameras. 12

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2. CMOS Automotive Market (Rev. Breakdown)

a. After 3 years of intense growth the CIS automotive market is now well established.

b. ON Semi is the dominant player in this market followed by Omnivision.

c. The acquisition of Toshiba CIS Biz by Sony will modify the balance of power in the

years to come.

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3. Automotive Supply Chain

資料來源: Kingpak Management

Audit Certification

1. The average timeline for camera module house to certify the system is ~ 1 to 2 years.

2. These Tier1 integrator have qualified Kingpak System/Products.

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6. Automotive ADAS Trends

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7. CMOS Automotive Market Trend

1. Different Sensor Technology, including NIR, Infrared Cameras, etc…

2. Up to 10 Cameras per car

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8. Automotive Camera per Cars Roadmap

1. Y2016(Current): Surround View(Display)

2. Y2020: Assistance for Driving Monitoring (Tesla)

3. After Y2020: more cameras due with Semi-Auto/ADAS demand

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9. Automotive Market Trend for ADAS

Adoption(Built-in vs. Timing) Rate: 1. 3-5 years: 1~4ea per car for Surround View Display

2. 7-10 years: 4~8ea for Assistance(Driving Monitoring)

3. Over 10 years: 8~10ea per car for Semi-Auto(ADAS)

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10. CMOS Automotive Market Trend

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ADAS & Autonomous Sensor Technology

1. Cameras are vital.

2. Strong growth in Camera

3. Volume demand for camera sensors to outstrip all other sensor types.

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Image Sensors – ADAS & Autonomous

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Automotive Camera Market Trend

1. A combination of sensor technology(Sensor Fusion) brings a robust solution.

2. Current price/performance for Radars/Cameras do match industry expectation…

3. Fusion with LiDAR will be particularly important onward of Autonomy.

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Automotive LiDAR

1. 2017 should be the start of LiDAR integration into every day automobile.

2. Autonomous vehicles are not accounted in this market prediction

3. It‟s expected the number of equipped vehicle to rise toward the million unit 2021.

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Automotive Market Trend (Time of Flight)

1. Gesture recognition is a the emerging stage.

2. Luxury vehicle such as BMW are implenting the approach.

3. Future of this technology is in the hands of those early Customers.

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Why is ADAS Growing So Fast?

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Image Sensor Are Vital

1. Camera for the Image sensors is the dominant portion.

2. In 2015 the average number of camera per car is ~1.0ea.

3. Some Cars will require +10 cameras.

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Camera Market Growth (1/2)

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Camera Market Growth (2/2)

1. Cameras are part of a broader range of sensing technology.

2. Front/Side Cameras tend to be “Smartest” with highest demanding.

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Ranking--20 Leading ADAS Suppliers in 2015

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Leading Suppliers Ranking in the ADAS

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B. Security /Surveillance

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1. CMOS Security Market Forecast (M unit)

CMOS sensor sales for security systems and surveillance applications are expected to grow by a

CAGR of ~+11.6%(2015-2021)

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2. CMOS Security/Surveillance(Revenue)

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3. Security / Surveillance Supply Chain

資料來源: Kingpak Management







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Index:

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A. ON Semiconductor : 1) Biz Strategies

(1) 2014 revenue (2) According to NASDAQ - based on closing stock price on May 1, 2014 (3) Sector % based on 1Q14 results

Remark: Strategies in Biz

a. Investing in Automobile & Industrial Sectors to drive business Growth.

b. #1 market share & expanding technology lead in automobile sectors.

c. Strong position on Security / Surveillance sector.

Headquarters: Phoenix, AZ

Employees: ~23,000 globally

Revenue: ~$3.5Bn(1)

Market Capitalization: ~$4.2Bn(2)

Ticker: ON

Founded: Spun-off from Motorola 1999, IPO 2000

2. ON Semiconductor -- Top 20

Source: Gartner Dec’14, Preliminary Ranking of Top 25 Semiconductor Vendors by Revenue

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Remark:

Rank in 2015: Top 20

Sources: iSuppli, IMS Research, Strategy Analytics, Fuji Chimera Research, ON Semiconductor Business Units and Corporate Marketing

Industrial ASIC #1

Notebook Adapters (ACDC) #1

Adaptive Front Lighting #1

Automotive Image Sensors #1

Linear VREG #1

Security Image Sensors #1

Audiology DSP Systems #1

PC Core Power (DCDC) #1

White Goods IPM #2

Protection #1

GP Op Amps #2

Automotive

Power Conversion & Motor Control

Image Sensors

Industrial IoT Wireless Devices

3. ON Semiconductor

CMOS in Automotive/Security

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Sony’s Core: 1. Sony CCD’s Technology Transfer; Pioneer in BSI; 2. The new stacked sensors are presented as the next evolution step, right after BSI. 3. Capa expansion plan ~45% from60Kpcs to 87Kpcs per month from Sept. 2016.

B. SONY :

1. Image sensor “Battle of the Giants”: Sony invests $4B.

What does it mean for the CIS industry?

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1. Sony owns about 35% market share in CIS.

2. Now 3% share in automotive; to be No 1 in automotive sensors" by the time self-

driving cars are expected to hit the roads in early to mid-2020s.

3. Sony’s new sensor is capable of capturing high-resolution color images in light

conditions as low as 0.005 lux, a level equivalent to that of a moonless night and

one that is far below illumination levels under a star-filled night sky. New

generation (higher resolution) products are also under mass production already.

2. Sony Aims at Automotive Cameras

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1. Towerjazz Panasonic Semiconductor Company is a joint venture 51% owned by

Tower Semiconductor and 49% owned by Panasonic.

2. TPSCo manuafactures CMOS to meet the growing demand in high end photography,

Security/surveillance and Automotive applications.

C. Panasonic

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1. Since 1999 ST has been an industry leader in the CMOS design and manufacturing.

2. ST’s sensors now address an increasing number of imaging applications in the

automotive, security, medical and high-end traditional camera market.

D. STMicroelectronics







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Index:

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1. Kingpak IPs

Remark

1 World#1 CSP Package Mass

Production for DRAM

2 Y2000 started Micro SD PIP

package, Y2005 World#1 MP

3 Most CMOS Image Sensor

package IP Company

329

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14 22

0

50

100

150

200

250

300

350

CMOS BGA / CSP Memory card Flip chip Process/Test

CMOS

BGA / CSP

Memory card

Flip chip

Process/Test

CMOS63%

BGA / CSP19%

Memory card11%

Flip chip3% Process/Test

4%

TechnolField Distribution (%)

Technology Field Distribution (Application count)

•~550 patent applications

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2. Kingpak Product & Service

a. Package Solutions

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b. Kingpak Dedicated Reconstructed Assembly

1. • Class 10 clean room for CMOS Image Sensors

2. • Auto/Visual Inspection

3. • Polish Grinding

4. • Laser Grooving

5. • Auto/Visual Inspection

c. Kingpak Final Test

1. • Industrial Standard System

2. • In-house Developed System

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3. Kingpak Quality System

Qualification & Certification

Remark : The average timeline for camera module house to certify the system is around 1 to 2 years.

Continental May 2012

Kostal Mar

2013

Hitachi AMS Aug 2013

Hyundai Oct 2013

Mando Oct

2013

LGIT (Innotek) Oct 2013

Bosch Apr

2014

Valeo Jun

2014

Delphi Jul

2014

Denso Aug 2014

Panasonic Nov

2015

Continuous +10 Automotive Customers Audit Pass at Excellence Grade

Stage 1: IP Patent Over 500 Patents, and 62% focus on CMOS

Stage 2: Quality System System certify : TS16949 ; ISO14001

0 dppm target : 6 sigma implement

Passed Tier 1 customer audit

Stage 3: Process Control High Level Clean room setup : Class 10

Good experience & Know-How at Particle control

Stage 4: Technical Supporting Fully Turn-Key Solution

Small Pixel size Handling experience

Package development Know-How &

Profile Stage 5: Management Team

Over 15 years CMOS experience Elite

Long term Relationship w/ Suppliers

4. Entry Barriers for Package 49







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Index:

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BSI (Back Side illuminated) Pixel isolation / CFA Tech.

3D Stack IC Quantum Dot Film

Frond-End

PDAF (Phase Detection AF) eDOF (Extended Depth of Field )

HDR (High Dynamic Range )

Software / Design

Higher Level Reliability

Small Form Factor Lower Cost

WLO (Wafer Level Optical ) OIS (Optical Image Stabilization)

Dual Camera Lens

Packaging / Assembly Optical Module

1. CMOS Image Sensors Upstream/Down Stream Technology Drives

http://www.google.com.tw/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCMPK2eCDgMgCFcKqpgod_Y0GlQ&url=http://www.businesswire.com/news/home/20121112005386/en/Image-Co-Processor-Platform-Powers-Aptina-HDR-Automotive&psig=AFQjCNGfFb_3VO2icv-h451nrHIGrdeomA&ust=1442646277420665

https://www.google.com.tw/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCOqchYWHgMgCFaPnpgodeL8H0A&url=https://gigaom.com/2014/01/10/apple-patent-details-optical-image-stabilization-for-iphone-cameras/&psig=AFQjCNFZKbmnNKItO0qxt2dl8kl84l2b2w&ust=1442647420638074

iBGA xx BGA CSP CLCC COB

Strength Reliability Image Quality High Speed Design

Reliability Image Quality High Speed Design

Dimension Package Cost

Reliability Thermal Performance

Dimension Cost

Weakness Dimension Dimension Reliability Image Quality

Package Cost Module Reliability Dimension

Reliability Module Yield Cycle Time

Opportunity

Coating glass embedded Electrical performance

Coating glass embedded Electrical performance

12 inch wafer for lower package cost

Easy Package Tech.

After Market

Threat Lower package cost for 12 inch CSP

Lower package cost for 12inch CSP

Coating Glass High speed design limitation

Less material supplier

Yield control

Potential Competitors

2.1 Competition Technologies & Analysis

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Index:

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KINGPAK 1~3Q 2016 Consolidated

Statement of Financial Information(YoY)

Better product migration & mix

Unit：USD K 1~3Q-2015 % 1~3Q-2016 % Y on Y.

Revenue 58,846 56,245 -4.4%

Gross profit 14,214 24.15% 16,342 29.06% 15.0%

Operating income 8,073 13.72% 10,059 17.88% 24.6%

EPS 0.17 0.20 0.02

ROA 28.00% 19.62% -8.39%

ROE 49.10% 35.65% -13.4%

Debt/Assets 56.92% 49.68% -7.2%

Current ratio 182.79% 126.11% -56.7%

Quick ratio 144.74% 114.76% -30.0%

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KINGPAK 1~3Q 2016 Consolidated

Statement of Financial Information

1~3Q-2015 1~3Q-2016

Revenue 58,846 56,245

Gross profit 14,214 16,342

EPS 0.17 0.20

0.16

0.17

0.18

0.19

0.20

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Unit：USD K

57 KINGPAK Q3 2016 Consolidated

Statement of Financial Information(QoQ)

Unit：USD K Q1-2015 % Q2-2015 % Q3-2015 % Q4-2015 % Q1-2016 % Q2-2016 % Q3-2016 % 2016

Q2 o Q3

Revenue 22,503 16,217 20,127 21,668 22,029 17,554 16,662 -5.1%

Gross profit 5,007 22.25 3,486 21.50 5,720 28.42 6,316 29.15 7,183 32.61 5,211 29.68 3,948 23.70 -24.2%

Operating income 2,881 12.80 1,823 11.24 3,369 16.74 4,319 19.93 4,765 21.63 3,287 18.73 2,007 12.04 -39.0%

EPS* 0.06 0.03 0.09 0.10 0.09 0.06 0.05 -0.02

ROA 25.33% 20.25% 28.00% 34.11% 28.38% 22.91% 19.62% -3.29%

ROE 58.47% 40.97% 49.10% 49.38% 46.63% 42.94% 35.65% -7.29%

Debt/Assets 72.39% 67.56% 56.92% 40.60% 38.79% 52.30% 49.68% -2.62%

Current ratio 135.82% 136.13% 182.79% 147.64% 147.33% 110.86% 126.11% 15.25%

Quick ratio 99.20% 100.03% 144.74% 122.84% 127.02% 98.42% 114.76% 16.34%

EPS*:retroactive adjustment

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KINGPAK Q3 2016 Consolidated

Statement of Financial Information

Q1-2015 Q2-2015 Q3-2015 Q4-2015 Q1-2016 Q2-2016 Q3-2016

Revenue 22,503 16,217 20,127 21,668 22,029 17,554 16,662

Gross profit 5,007 3,486 5,720 6,316 7,183 5,211 3,948

EPS 0.06 0.03 0.09 0.10 0.09 0.06 0.05

0.00

0.02

0.04

0.06

0.08

0.10

0.12

0

5,000

10,000

15,000

20,000

25,000

Unit：USD Unit：USD K

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註1：當季資產/股東權益報酬率係年化比率

KINGPAK Q3 2016 ROE/ROA

Q1-2015 Q2-2015 Q3-2015 Q4-2015 Q1-2016 Q2-2016 Q3-2016

ROE 58.47% 40.97% 49.10% 49.38% 46.63% 42.94% 35.65%

ROA 25.33% 20.25% 28.00% 34.11% 28.38% 22.91% 19.62%

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

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KINGPAK Q3 2016 Key Financial Indices Ratios Analysis Q1-2015 Q2-2015 Q3-2015 Q4-2015 Q1-2016 Q2-2016 Q3-2016

Financial

Structure Ratio of Liabilities toAssets 72.39 67.56 56.92 40.60 38.79 52.30 49.68

(%) Debt of Long Fund to Bank

Property and Equipment 193.59 168.97 187.19 173.62 173.81 140.58 144.42

Solvency Current Ratio 135.82 136.13 182.79 147.64 147.33 110.86 126.11

(%) Quick Ratio 99.20 100.03 144.74 122.84 127.02 98.42 114.76

Times Interest

Earned Ratio 12.36 6.54 33.17 60.80 109.45 65.22 30.98

Account Receivable Turnover 17.66 14.94 11.27 15.45 10.62 10.42 10.55

Operationg Days Sales in Account

Receivable 21 24 32 23 34 35 35

Ability Account Payable Turnover 18.84 19.31 16.10 18.69 10.19 8.66 9.04

Days Pay in Account Payable 19 19 23 20 36 42 40

Cash Turnover 29 35 33 18 18 14 13

Inventory Turnover 12.98 12.35 15.90 25.59 19.25 17.31 18.90

Average Days in Sales 28 30 23 14 19 21 19

Fixed Property and Equipment

Turnover 8.26 6.77 7.09 7.08 3.71 3.19 2.85

Total Assets Turnover 1.96 1.81 1.99 2.16 1.52 1.27 1.18

Ratio of Return on Total Assets 25.33 20.25 28.00 34.11 28.38 22.91 19.62

Profitability Ratio of Return on

Shareholder’s Equity 58.47 40.97 49.10 49.38 46.63 42.94 35.65

Profit Ratio 12.06 7.59 18.84 20.02 18.53 16.94 13.08

Earnings per share 0.06 0.03 0.09 0.10 0.09 0.06 0.05

EBITDA 3,955 2,470 4,871 5,398 5,519 4,367 3,759

Net Equity per share 0.48 0.52 0.59 0.74 0.87 0.71 0.77

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KINGPAK Q3 2016 Business Segment (In Revenue)

Q1-2015 Q2-2015 Q3-2015 Q4-2015 Q1-2016 Q2-2016 Q3-2016

US$7.46 US$5.65 US$7.55 US$9.95 US$10.84 US$7.87

US$6.13

US$3.10 US$3.00 US$3.27

US$2.65

US$4.43 US$5.91

US$6.53 US$4.08

US$3.95 US$5.53 US$4.65 US$1.98

US$1.99 US$3.37 US$7.87

US$3.62 US$3.77 US$4.43 US$4.78 US$1.79

US$0.64

Automotive Security Consumers Memory

Unit：USD in Million

●1~3Q-2016 YoY +21% For Automotive in Revenue.

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KINGPAK Q3 2016 Business Segment (In %)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Q1-2015 Q2-2015 Q3-2015 Q4-2015 Q1-2016 Q2-2016 Q3-2016

33% 35% 38% 46% 49% 45%

37%

14% 18% 16%

12% 20% 34%

39% 18%

24% 27% 21% 9%

11% 20% 35%

22% 19% 20% 22% 10%

4%

Automotive Security Consumers Memory

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~THANK YOU~

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Potential of CMOS Image Sensors in Automotive Industry

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