CJS(SH:600176) Shenwan Hongyuan Securities·2026-03-08 08:15Investment Rating - The report rates the construction materials industry as "Overweight" indicating a positive outlook for the sector compared to the overall market performance [2][3]. Core Insights - The ordinary fabric has seen its third price increase of the year, rising by 0.5 yuan to 5.7 yuan/meter, with a total increase of 1.5 yuan/meter since January, reflecting sustained industry demand and pricing power [3]. - The demand for ordinary electronic fabric is robust, driven by the continuous growth in integrated circuit board production, which has seen a year-on-year increase of over 10% for seven consecutive months from June to December 2025 [3][10]. - Supply growth for ordinary electronic fabric is expected to decline as the expansion cycle driven by high demand from 2021-2022 is nearing its end, and many manufacturers are shifting production to high-margin specialty fabrics [3]. - Specialty fabrics are experiencing high demand, particularly low dielectric and low expansion coefficient fabrics, with significant price increases announced by leading companies in the sector [3]. - Key investment recommendations include focusing on core suppliers of ordinary fabric such as China Jushi and monitoring specialty fabric companies like China National Materials, International Composites, and Honghe Technology [3]. Summary by Sections Price Trends - The price of electronic fabric has been on a continuous upward trend, with significant increases noted in recent months [4][5]. Production Capacity - The growth rate of electronic fabric production capacity is entering a declining phase, with projections indicating a slowdown in capacity expansion [6]. Integrated Circuit Production - The production of integrated circuits in China has been consistently increasing, with record monthly outputs and strong year-on-year growth rates [9][10]. Company Valuation Comparisons - Key companies in the sector have varying valuations, with China Jushi rated as "Buy" and showing strong earnings growth projections for 2024-2026 [12].