Group 1 - The core viewpoint of the report is that Jaxin International Resources (03858) is focused on the operation of the Bakuta tungsten mine in Kazakhstan and is expected to perform well, with an initial coverage rating of "outperform" and a target price of HKD 95.00 based on P/E valuation methods, corresponding to 22.6x and 14.8x P/E for 2026-2027 [1] Group 2 - The global tungsten supply-demand pattern is expected to remain tight, with tungsten prices likely to steadily increase. The supply side shows a strong scarcity of global tungsten supply, with China consistently holding the largest share of production. Domestic supply is facing contraction pressures due to declining ore grades and stricter production regulations, while overseas tungsten mine development is generally slow. The forecast for global tungsten supply from 2023 to 2028 is a CAGR of +2.4% [2] - On the demand side, emerging needs from photovoltaic tungsten wires, AI PCBs, and large infrastructure projects are expected to boost domestic tungsten consumption. Additionally, ongoing geopolitical conflicts may trigger strategic stockpiling demands. The forecast for global tungsten consumption from 2023 to 2028 is a CAGR of +2.7% [2] - The company has four core advantages that position it as a highly competitive mining leader in the Central Asian region: 1) High-quality resources with large reserves and low costs at the Bakuta tungsten mine; 2) Favorable location with excellent transportation and a supportive business environment in Kazakhstan; 3) Effective operational mechanisms through a mixed ownership structure and management team; 4) Strong growth potential in capacity expansion, deep processing, and resource accumulation [3] Group 3 - The company’s earnings per share (EPS) are projected to be HKD 0.63, HKD 4.18, and HKD 6.56 for 2025-2027, with a CAGR of 221.6%. The net profit attributable to the parent company is expected to be RMB 2.6 billion, RMB 17.2 billion, and RMB 26.3 billion for the same period. The current stock price corresponds to 16.5x and 10.5x P/E for 2026-2027, with an initial coverage rating of "outperform" and a target price of HKD 95, indicating a potential upside of 38% [4]

Core Viewpoint - Dazhu CNC's 2025 performance forecast significantly exceeds expectations, driven by the expansion of computing PCB and technological upgrades, indicating strong growth potential in the PCB equipment industry [2][4]. Group 1: Performance Forecast - The company forecasts a net profit attributable to shareholders of 7.85-8.85 billion, with a median of 8.35 billion, representing a substantial year-on-year increase of 177%. The non-recurring net profit is expected to be 7.80-8.80 billion, with a median of 8.30 billion, reflecting a year-on-year growth of 295% [2]. - For Q4 2025, the forecasted net profit attributable to shareholders is 3.43 billion, showing a year-on-year increase of 250% and a quarter-on-quarter increase of 50%. The non-recurring net profit is projected at 3.55 billion, with a year-on-year growth of 759% and a quarter-on-quarter growth of 57% [2]. Group 2: Industry Position and Product Development - Dazhu CNC is positioned as a leader in the mechanical drilling sector, with its CCD back-drilling machine showing significant advantages and doubling in value. The demand for orders is expected to increase quarterly, supported by a rising proportion of AI products, which enhances profitability [3]. - The company is preparing to double its production capacity this year, ensuring sufficient readiness for equipment delivery to PCB manufacturers in the coming years, with expectations of securing bulk orders from major PCB clients [3]. - The ultra-fast laser products from Dazhu are technologically advanced, offering advantages such as improved processing quality and efficiency, suitable for new technologies and material upgrades in the computing PCB sector [3]. Group 3: Equipment and Process Overview - Dazhu CNC's equipment includes exposure equipment, pressing equipment, drilling equipment, electroplating equipment, testing equipment, and forming equipment, each playing a critical role in the PCB production process [5][10]. - The exposure process involves high-precision imaging systems, while the drilling process utilizes advanced laser technology to address key interconnection challenges in PCB production [5][10].

Summary of the Conference Call for Dazhong Laser Company and Industry Overview - **Company**: Dazhong Laser - **Industry**: PCB (Printed Circuit Board) and Consumer Electronics Key Points and Arguments - Dazhong Laser is benefiting from a surge in AI PCB capital expenditures, leading to a rapid recovery in equipment demand, particularly in the ultra-fast laser technology sector, which has achieved breakthroughs in multi-layer and HDI board processing due to low thermal effect technology, positioning the company for a potential demand explosion [2][4] - Apple Inc. is entering a significant innovation cycle from 2025 to 2027, with the launch of new products such as the iPhone 17, foldable phones, and the 20th anniversary edition, which is expected to significantly boost demand for high-end manufacturing equipment, including AI phone VC heat dissipation boards and laser welding camera dispensing technologies [2][7] - The adoption of 3D printing technology in the consumer electronics sector, particularly in the manufacturing of titanium alloy frames, is expected to provide a competitive advantage over traditional CNC processes, with Apple likely to gradually incorporate this technology into high-end phones, thereby increasing demand for 3D printing equipment from Dazhong Laser [2][8] - Dazhong CNC, a subsidiary of Dazhong Laser, is a supplier of mechanical drilling machines and CO2 drilling machines for domestic PCB manufacturers, and is experiencing a rapid recovery in equipment demand due to the explosion of AI PCB capital expenditures and increased demand from overseas clients for new material applications [4][5][6] Additional Important Insights - The synchronization of growth in PCB and consumer electronics businesses is anticipated to significantly enhance Dazhong Laser's profitability in 2026-2027, with the market not fully pricing in the potential of its core consumer electronics business, suggesting a possible 50% to 100% revaluation of the company's market value [3][9] - Historical data indicates that major updates during Apple's innovation cycles, such as the launch of the iPhone X in 2017, have led to substantial increases in demand for related equipment, highlighting the importance of Apple's product cycles for Dazhong Laser's business [7] - The development of ultra-fast laser technology has allowed Dazhong CNC to achieve a competitive edge in the laser drilling machine sector, particularly in processing multi-layer and HDI boards, which is crucial for future material upgrades [5][6]

Summary of Conference Call Notes Industry Overview - The Q fabric (Q 布) industry is experiencing a significant boost due to the deployment of A-grade chips, which is enhancing the overall PCB (Printed Circuit Board) market sentiment. The market is particularly focused on the store segment, driven by projected demand for AI PCBs and the value share of CCL (Copper Clad Laminate) in 2026 [2][4]. Key Insights and Arguments - The announcement of NVIDIA's CPS (Cloud Processing Service) solution has clarified the market's understanding of the supply-demand relationship, with approximately 1,000 million meters of demand already met for 70% of PCB capacity compensation [2][4]. - In 2026, the demand is expected to increase significantly, with Robin's mass production of the Switch version anticipated to add around 4 million meters of demand. If Google's TPU V8 series adopts the proposed repair solution, an additional 8 million meters of demand could arise, potentially doubling total demand from 1,000 million meters to over 2,000 million meters [2][5][6]. - Looking ahead to 2027, if NVIDIA's ROPIN ULTRA series fully adopts the proposed solutions and Google's TPU V8 and V9 chips reach a production target of 5 million units, total demand could exceed 80 million meters [6]. Production Challenges - The production of Q fabric faces three main challenges: 1. High purity and low impurity requirements for quartz raw material. 2. Complex quartz rod drawing processes that require uniformity control and are prone to breakage. 3. Strict weaving processes that involve maintaining smoothness and applying lubricants [7]. - Currently, only two suppliers, Feiliwa and Asahi Kasei, can produce quartz fibers with a dielectric constant DF value below 5/10,000 in small batches. Feiliwa has a mature drawing process capable of supporting 300,000 meters of customer production monthly, with plans to expand to a capacity of 1,200 million meters by 2026 [7]. Company-Specific Developments - New Qimei Beauty Company is optimistic about its prospects in the PCB equipment sector, with new products like CO2 laser drills and advanced packaging expected to ramp up production next year. The company is positioned to benefit from the rising PCB market, potentially achieving a second growth curve and enhancing its valuation [3][8]. - Other domestic companies, such as Xi'an Laide Optoelectronics, are also making strides in the Q fabric supply chain, including upstream quartz mining and downstream weaving processes. Shanghai Telai Crystal is expected to reach a production capacity of 1 million meters per month by 2027, contingent on successful capacity construction and validation [9].

Market Overview - On December 24, A-shares experienced an upward trend with all three major indices rising, and over 4,000 stocks in the market increased in value. The Shanghai Composite Index rose by 0.53%, the Shenzhen Component Index by 0.88%, and the ChiNext Index by 0.77%. The total market turnover was approximately 1.9 trillion yuan [1]. Sector Performance - The power supply and commercial aerospace sectors were notably active, while precious metals and Hainan sectors saw adjustments. The PCB concept leader, Shengtong Energy, hit the daily limit and reached a historical high, while multiple solar energy stocks also surged [3][8]. Financing and Stock Performance - As of December 23, the financing balance in the A-share market reached a historical high of 2.514596 trillion yuan, increasing by 14.859 billion yuan from the previous trading day. The financing balance on the Shanghai Stock Exchange was 1.271202 trillion yuan, while the Shenzhen Stock Exchange reported 1.235507 trillion yuan [3]. Shengtong Energy - Shengtong Energy's stock price has seen a continuous rise since December 12, achieving a nine-day limit-up streak and closing at 34.79 yuan per share, with a market capitalization nearing 10 billion yuan. The stock has increased by 342.4% year-to-date [4][6]. Solar Energy Sector - The solar energy sector showed strong performance, with multiple stocks hitting the daily limit. Notable stocks included Youyan Powder Materials and Hainan Development, which achieved consecutive limit-ups [8][12]. PCB and Electronic Industry - The PCB and CPO concepts experienced significant upward movement, with stocks like Yingtang Zhikong and Shengyi Technology reaching their daily limits. The demand for AI-related PCBs is expected to grow rapidly, driven by advancements in AI infrastructure [13][18].

Core Viewpoint - The PCB sector has shown strong performance, with significant stock price increases for companies like Youyan Powder Materials and Ruihua Tai, indicating a bullish market trend driven by advancements in AI and consumer electronics [1] Group 1: Market Trends - Since 2025, the consumer electronics market is expected to continue its recovery, with the launch of new foldable smartphones and advancements in AI technology driving high demand for AI infrastructure [1] - Major investments in data center expansions by AI and global internet companies are projected to lead to a compound annual growth rate of 21% in global data center capital expenditures by 2029, according to Dell'Oro [1] Group 2: Industry Dynamics - The expansion of computing power will exacerbate "network bottlenecks," transforming switches from mere accessories into critical components for enhancing data center performance, thereby rapidly increasing demand for high-speed switches [1] - The increasing number of PCB layers and the upgrading of materials used in AI servers and high-speed switches are expected to significantly enhance the value of PCBs per unit, contributing to a rapid growth in the AI PCB market [1]

Investment Rating - The report maintains a positive outlook on the industry, indicating a strong long-term growth potential driven by the demand for AI PCB copper plating materials [2][4]. Core Insights - The demand for AI PCB copper plating materials is expected to surge due to the upgrade of PCB products towards higher aspect ratios and increased blind buried holes, leading to a significant rise in both volume and price, thus driving rapid profit growth in the industry [2]. - The report forecasts that the proportion of PCB copper powder consumables in electroplating materials will increase from 15% currently to over 27% by 2029, reflecting a growing trend in copper powder usage [2]. - The industry is currently experiencing a tight supply-demand balance, with signs of potential price increases in processing fees for copper powder due to strong downstream demand before new capacities come online [2]. Summary by Sections 1. PCB Electroplating and Consumables Introduction - Electroplating is a core process in PCB manufacturing, directly affecting the final product's performance, including signal transmission loss and power network integrity [7][10]. - The increasing complexity of AI PCBs, characterized by smaller hole diameters and higher layer counts, raises the requirements for electroplating materials [7][19]. 2. Changes in Demand and Technology - The report highlights a shift in the electroplating process from traditional copper balls to high-purity electronic-grade copper powder, driven by the need for improved plating uniformity and depth filling capabilities [28][30]. - The processing fee for copper powder is approximately five times that of copper balls, indicating a significant shift in the value chain towards higher-end materials [30][31]. 3. Market Size and Growth Projections - The global PCB electroplating copper material market is projected to reach $6.56 billion by 2029, with steady growth anticipated from $4.81 billion in 2025 [43][44]. - The report estimates that the copper value per square meter for PCBs used in AI servers is approximately $1.75, significantly higher than the $0.52 for traditional PCBs, reflecting the increased complexity and value of AI PCBs [32][33]. 4. Supply Landscape - The domestic supply landscape is characterized by major players such as Jiangnan New Materials and Guanghua Technology, while Japanese and Korean companies maintain a technological edge in high-end markets [35][36]. - The report notes that domestic manufacturers are rapidly increasing their production capacities, with significant expansions planned for the coming years [39][40].

Summary of Han's CNC Technology (301200.SZ) Conference Call Company Overview - **Company Name**: Han's CNC Technology (HC) - **Ticker**: 301200.SZ - **Industry**: PCB (Printed Circuit Board) Equipment Manufacturing - **Market Position**: Leading PCB equipment supplier in China with a global market share of 6.6% in 2024, potentially reaching 10-11% [23][24] Key Financial Highlights - **4Q25 Revenue Growth**: Estimated at 64% YoY, leading to a projected revenue of Rmb1,644 million [2][11] - **Net Profit**: Expected to increase by 117% YoY to Rmb213 million in 4Q25 [2] - **Gross Profit Margin (GPM)**: Anticipated expansion of 5.8 percentage points YoY, reaching 34.2% in 4Q25 [2][11] - **Earnings Forecast**: - 2025E Net Profit: Rmb705 million - 2026E Net Profit: Rmb1,179 million - 2027E Net Profit: Rmb1,666 million [4][10] Product and Market Dynamics - **Ultrafast Laser Drilling Equipment**: Recently started deliveries, with an average selling price (ASP) of US$800k and a gross profit margin (GPM) exceeding 50% [1] - **Mechanical vs. Laser Drilling**: Demand for mechanical drilling remains strong, as evidenced by capacity expansions from leading drill bit manufacturers [3] - **Competitors**: Notable competitors include Ta Liang (3167.TW) and China Tungsten and Hightech Materials (000657.SZ) [3][17] Investment Strategy - **Rating**: Buy/High Risk - **Target Price**: Rmb140, implying a potential upside of 17.4% from the current price of Rmb119.30 [5][10] - **Expected Total Return**: 18.1%, including a dividend yield of 0.8% [5] Risks and Considerations - **High Risk Rating**: Potential risks include weaker-than-expected demand for AI PCB equipment, rising component costs affecting GPM, and increased price competition due to supply increases in the industry [26] Conclusion - Han's CNC is positioned to benefit from the ongoing AI PCB super cycle, with strong revenue and profit growth expected in the coming years. The company remains a top pick in the automation and machinery sector in China, supported by robust demand for its products and strategic market positioning [1][24]

Core Viewpoint - The PCB industry is experiencing a growth cycle driven by AI, with increasing demand for high aspect ratio and multi-blind buried hole PCBs, leading to a surge in copper powder consumption and profitability in the industry [2][5][20]. Group 1: AI PCB and Copper Powder Demand - AI PCBs are driving the demand for copper powder, with the proportion of copper powder in PCB electroplating materials expected to rise from 15% to over 27% by 2029 [5]. - The processing fee for copper powder is 4-5 times that of copper balls, indicating a significant potential for profit growth in the copper powder industry [5][28]. - The demand for copper powder is expected to increase due to the rising complexity and requirements of AI PCBs, which necessitate higher copper thickness and more intricate plating processes [24][25]. Group 2: Supply and Production Dynamics - The supply of copper powder is currently tight, with domestic producers like Jiangnan New Materials and Guanghua Technology leading the market, while Japanese and Korean companies maintain technological advantages [6][33]. - The production capacity of domestic manufacturers is expected to increase significantly, with over 30,000 tons of new capacity anticipated by 2026 [5][38]. - The approval process for project qualifications and the relatively long expansion cycle may limit rapid capacity increases in the short term [6]. Group 3: Technological Advancements and Market Trends - The transition from copper balls to copper powder is becoming a trend due to the latter's superior performance in high-end PCB applications, particularly in terms of purity and stability [27][29]. - The shift towards pulse plating technology in PCB manufacturing is addressing the challenges of uniformity and filling capabilities in high aspect ratio designs [26]. - The increasing complexity of HDI PCBs requires advanced materials and processes, with copper powder emerging as a critical component in meeting these demands [22][24]. Group 4: Economic Implications and Market Positioning - The economic model for copper powder is based on a higher processing fee compared to copper balls, reflecting its value in high-end applications [28][29]. - The market for high-end copper powder is currently dominated by foreign companies, but domestic firms are rapidly advancing in technology and production capabilities, creating opportunities for local replacements [28][36]. - The profitability of copper powder is expected to improve as demand increases and supply tightens, with potential for higher margins in the future [38].

Core Insights - Recent performance of Nvidia's FY26Q3 exceeded expectations, and the FY26Q4 guidance is also optimistic, indicating a strong upward trend in the AI industry [1] - Google's release of Gemini 3 shows significant performance improvements, further supporting the growth narrative in AI [1] Industry Opportunities - The report highlights PCB as a key sector benefiting from the AI chip upgrade cycle, suggesting a favorable investment outlook for this industry [1] - There is a recommendation to focus on leading companies with strong technical capabilities and customer positioning, as well as high earnings certainty [1] - Companies that are actively expanding capacity and strengthening AI business expectations are also identified as potential investment targets [1] - The report notes the profit improvement for companies benefiting from the rising prices of copper-clad laminates and the increased volume of high-end materials [1]