Investment Rating - The report maintains an "Outperform" rating for the PCB industry [2]. Core Insights - The industry is entering a new AI-driven cycle, fundamentally changing demand structures. The construction of AI server clusters is leading to simultaneous upgrades in PCB demand and pricing. The expected market for wired communication PCBs will reach 206.9 billion RMB by 2027, with a CAGR of 20% over the next two years [4]. - High-end PCBs are expected to remain in tight supply until 2027, with major global manufacturers expanding production aggressively. The combined output of 13 leading PCB manufacturers is projected to reach 186 billion RMB by 2027, with a CAGR of 54% from 2025 to 2027 [4]. - The trend towards high-end PCB manufacturing is accelerating due to technological iterations and material upgrades. The industry is expected to see a three-pronged evolution in materials, processes, and architectures driven by AI [4]. - The demand surge and profit improvement in upstream materials present opportunities for domestic substitution. The price of copper-clad laminates has risen significantly, and domestic manufacturers are making notable progress in high-end materials [4]. - The PCB industry is experiencing a long-term trend of simultaneous growth in volume, price, and structure, driven by AI. The report recommends focusing on leading companies with high-end manufacturing capabilities and overseas delivery layouts [4]. Summary by Sections AI-Driven Growth - The AI cycle is expected to drive significant growth in PCB demand, particularly in AI servers, high-speed switches, and optical modules. The total market for wired communication PCBs is projected to reach 1,433 billion RMB by 2025 and 1,815 billion RMB by 2026 [19]. Production Capacity Expansion - Major PCB manufacturers are announcing aggressive expansion plans, with significant investments in new production facilities in Southeast Asia and domestic high-end capacity [15]. Technological Advancements - The report highlights the rapid adoption of mSAP technology in AI servers and switches, which is essential for meeting the demands of high-density signal transmission [4][21]. Market Dynamics - The report notes that the global PCB market is expected to face a supply-demand gap of nearly 20 billion RMB by 2026, although this gap is anticipated to narrow by 2027 [19]. Key Players - The report identifies leading companies such as Huada Technology, Jingwang Electronics, and Shenghong Technology as key players to watch in the PCB industry due to their high-end manufacturing capabilities and strategic expansion plans [4].