South Korea's Hana Micron (067310.KQ) and U.S.-based Amkor Technology (AMKR.O) are leading a surge of investment in Vietnam's semiconductor packaging sector, amid growing client demand for alternatives to China. Hana Micron, a semiconductor assembly, testing, and packaging (ATP) specialist, is investing 1.3 trillion won (around $930 million) by 2026 to enhance packaging operations for legacy memory chips. Cho Hyung Rae, Hana's vice president for Vietnam, explained that the expansion aligns with customer requests to shift production out of China.

Amkor Technology, headquartered in the U.S., has also committed $1.6 billion to build its largest and most advanced facility in Vietnam. Expected to span 200,000 square meters (2.2 million sq. ft), this facility will focus on “next-generation semiconductor packaging capabilities.” An executive with knowledge of the project noted that some equipment for the plant had been moved from Amkor's China facilities, although the company has not confirmed this. Intel (INTC.O), another major player in Vietnam's semiconductor sector, already operates its largest global back-end facility in the country.

The investments from these companies signal Vietnam's rapid rise in the semiconductor ATP sector, which is expected to capture an 8-9% global market share by 2032, up from just 1% in 2022, according to a report by the U.S. Semiconductor Industry Association and Boston Consulting Group.

Local Vietnamese firms are also entering the semiconductor field. Tech company FPT (FPT.HM) plans to open a $30 million, 1,000-square-meter testing factory near Hanoi by early 2024, with plans to triple its equipment by 2026. Sovico Group, a Vietnamese investment firm, is seeking international partners to co-invest in an ATP facility in Danang. Meanwhile, Viettel, a state-owned telecom and defense firm, aims to establish Vietnam's first chip foundry by 2030 as part of the government's goal to develop at least one domestic fab.

Vietnam's focus on the ATP sector reflects its ambitions to attract more chip manufacturers by offering cost-effective labor and a stable political environment. With additional interest from tech giants like Nvidia and Apple, Vietnam is emerging as a strategic hub in the global semiconductor supply chain as companies diversify beyond China.