Focus on Domestic High-end PCB Replacement Process

PCB is the mother of electronic products, and the range of market is growing steadily. As a transmission medium, PCB can realize the connection between electronic components, play the role of relay transmission, and is the support body of electronic components.

In 2019, the global PCB output value was 61.3 billion US dollars, with a compound annual growth rate of 2.18% from August to 19th, showing an overall steady growth. The PCB market in Mainland China is benefiting from the transfer of global PCB production capacity to mainland China and the growth of downstream terminal demand. In recent years, the PCB market in Mainland China has shown a rapid development trend. The OUTPUT value of PCB in Mainland China reached 33.507 billion US dollars in 2013, with a compound annual growth rate of 7.56% from August to 19th.

Raw material cost pressure eased, PCB enterprises 21Q3 ushered in the performance inflection point. Since 2021, supply constraints/strong demand/monetary easing and other factors have jointly driven up the price of commodity raw materials, affecting the profitability of downstream PCB companies. After Q3, with the easing of the epidemic in copper producing countries, superimposed enterprises began to shift part of the cost pressure to the downstream, and the impact of raw material prices on corporate performance was blunted to some extent, and the profitability of the sector was repaired. PCB board 21Q3 realized revenue of 53.33 billion yuan, up 27.7% year on year, realized net profit of 5.08 billion yuan, up 38.2% year on year. In q3, the gross profit margin of the sector was 20.9%, down 2.4 PCT year-on-year. The net profit margin of the sector was 9.6%, up 0.7 PCT year-on-year. The profit growth rate began to turn positive, and the profitability was improved, and the sector ushered in the performance inflection point.

China's PCB products are mainly low-end, focusing on IC board, high order HDI and other high-end products of domestic replacement process. At present, China's PCB products are mainly low-end PCBS, while the share of packaging substrate, high-order HDI and other high-end PCBS is relatively low, and the product structure needs to be optimized. As PCB enterprises represented by Xingsen and Shennan expand the production capacity of high-end PCB such as IC board, the voice of domestic enterprises in the field of high-end PCB is expected to be enhanced. It is suggested to pay attention to relevant beneficiary enterprises.