Summary of New Qiwei's Conference Call Company Overview - New Qiwei has achieved a leading position in the global PCB exposure equipment market, with a market share exceeding 15% in 2024, expected to rise to 20%-25% in 2025 and further increase in 2026, indicating strong growth potential and market leadership [2][5][7]. Financial Performance - For the first three quarters of 2025, New Qiwei reported revenue of 934 million RMB, a year-on-year increase of over 30%. The net profit reached 200 million RMB, significantly surpassing the previous year's target of 160 million RMB [3][5]. Market Dynamics - The decline in Q3 2025 was attributed to a surge in orders in Q2, leading to delays in testing and acceptance after a peak in shipments. However, the overall order intake and production scheduling remain positive, with a healthy inventory structure of over 800 million RMB, one-third of which consists of shipped goods awaiting acceptance [6][7]. Customer Base and Market Share - New Qiwei's exposure equipment has a high market share among major clients, with approximately 80-90% market penetration in leading companies like Shenghong and Jingwangda, and over 50% in others like ShenNan and Pengding [2][8]. Technological Advancements - The company has developed significant advantages in high-precision wafer-level processes, supported by a strategy focused on major clients and technological upgrades. The introduction of advanced laser direct writing technology is expected to drive growth in the advanced packaging sector starting in 2026 [4][11]. Industry Trends - The demand for high-resolution exposure equipment is increasing due to the trend of multilayer boards moving towards higher density and larger sizes, with an estimated 15%-20% increase in equipment demand as the number of layers rises from 24 to 30 [16][17]. Competitive Landscape - New Qiwei has established a significant competitive edge over domestic rivals through its focus on high-precision, stable wafer-level processes, and a strong customer strategy. The gap between New Qiwei and its competitors is expected to widen [10][19]. Future Outlook - The company anticipates continued growth in Q4 2025, supported by a robust order book and effective management of accounts receivable and prepayments. The expansion of production capacity and market penetration in Southeast Asia is also expected to bolster its market position [7][8]. Maintenance Revenue - Maintenance revenue is projected to reach approximately 80-100 million RMB in 2025, with a gross margin of around 60%. The maintenance fees are typically about 10% of the equipment sale price, starting after a one-year warranty period [4][26]. Equipment Pricing - The average price of New Qiwei's semiconductor equipment ranges from 15 million to 20 million RMB, with an average of 17-18 million RMB, indicating a significant price difference compared to PBB exposure equipment [12]. Conclusion - New Qiwei is well-positioned for future growth in the PCB and semiconductor equipment markets, driven by technological advancements, a strong customer base, and strategic market expansion efforts. The company is expected to maintain its leadership position and capitalize on emerging industry trends.

Investment Rating - The report maintains an "Outperform" rating for the PCB industry [5] Core Insights - The global PCB market is steadily growing, driven by the ongoing development of AI computing power and the rapid expansion of emerging fields such as robotics and automotive electronics. The demand for high-end PCBs, particularly multilayer and HDI boards, is expected to rise significantly, becoming a core driver of the global PCB market [1][2][3] Summary by Sections 1. Industry Overview - PCB is a critical interconnection component used in assembling electronic parts, with a wide range of applications across various sectors including communications, consumer electronics, automotive electronics, and more. It is often referred to as the "mother of electronic products" [10][13] 2. Market Growth - The global PCB market is projected to reach USD 73.6 billion in 2024, representing a year-on-year growth of 5.8%. By 2025, the market is expected to grow to USD 78.6 billion, with a year-on-year increase of 6.8%. The PCB industry in China is expected to grow at a rate of 8.5% in 2025, particularly in the high-end segments driven by AI computing demand [2][24][27] 3. Demand from Emerging Fields - Emerging sectors such as servers, storage, and automotive electronics are driving the demand for high-end PCBs. The performance of domestic PCB manufacturers is strong, with significant technological advancements and market positioning [3][34] 4. Production Expansion - Major PCB manufacturers are accelerating the expansion of high-end PCB production capacity, which is expected to benefit upstream equipment and materials. The cost of copper-clad laminates (CCL) is significant, and many domestic companies are actively investing in this area [3][4][20] 5. Investment Recommendations - The report suggests focusing on leading PCB manufacturers that are strategically positioned in the high-end PCB market, as well as those in the upstream equipment and materials sectors, such as copper-clad laminates and drilling and exposure equipment [4][6]

当前 PCB 设备市场的需求情况如何？ 目前，PCB 设备市场的需求类似于 2020 年三四季度或 2021 年的光伏锂电设 备市场。下游需求景气度显著，订单落地刚开始，预计今年第四季度和明年整 体订单兑现度会很高。这是基于现有上市公司扩产推算得出的结论。按照专用 设备扩产周期来看，不排除未来出现竞争性扩产机会，因此当前是配置设备公 司的较好时机。 PCB 设备行业的市场空间如何评估？ PCB 设备行业的需求主要分为存量更新替换和增量需求。存量更新替换方面， 可以通过产值法倒推整体空间。去年国内 PCB 行业产值约 400 亿美元（约 2,840 亿人民币），其中高多层占比 38%，HDI、封装基板和柔性板各占 17%左右。消费类 PCB 产品的设备占产值比重约 20%，HDI 为 50%~70%， AI 驱动 PCB 设备需求提升 20250922 摘要 PCB 设备行业存量更新替换市场空间巨大，约 1,000 亿人民币，每年稳 定替换需求在 200-300 亿人民币，主要通过产值法倒推得出，消费类 PCB 产品的设备占产值比重约 20%，HDI 为 50%~70%，载板为 1:1。 AI 相关领域驱动 P ...

Group 1 - The global AI infrastructure is experiencing significant growth due to the expansion of AI applications, leading to a substantial increase in PCB demand [1] - The global server/data storage market is projected to reach $291 billion in 2024, with a year-on-year growth of 45.5%, and is expected to maintain a growth rate of 36.1% in 2025 [1] - The demand for AIPCB is driven by the increasing requirements for PCB layers in AI servers and high-end switches, with the PCB value for each AI server expected to be 5 to 7 times higher than that of traditional servers [1] Group 2 - Leading PCB companies are ramping up production, but actual capacity release is lagging behind demand growth due to high-end equipment delivery and key process verification challenges [2] - Domestic manufacturers are expected to capture market share more quickly than overseas competitors due to their faster expansion capabilities [2] Group 3 - The ongoing expansion of AIPCB is directly impacting PCB processing, leading to increased volume and more complex processing requirements, which in turn drives up both the quantity and price of equipment and materials [3] - The demand for key equipment and materials is anticipated to grow in tandem with the rising requirements for AIPCB [3] Group 4 - Domestic manufacturers are advancing in technology iteration and expansion, with a notable supply gap in high-end drilling equipment, while foreign suppliers are facing demand shortages [4] - Domestic suppliers are leading in expansion capabilities and are increasingly replacing foreign suppliers in the mid-to-low-end market [4] Group 5 - Investment recommendations include focusing on technology-leading suppliers such as Chipbond Technology and Dazhong CNC, as well as materials suppliers like Dingtai High-Tech and Zhongtung High-Tech due to the increasing demand for drilling tools [5] - Attention is also recommended for companies involved in the PCBA segment, such as Kaige Precision Machinery and Jintuo Co., Ltd [5]

Core Viewpoint - The company reported strong financial performance for the first half of 2025, with significant year-on-year growth in revenue and net profit, driven by demand in the AI server market and advancements in drilling equipment technology [1][4]. Financial Performance - For the first half of 2025, the company achieved operating revenue of 2.382 billion yuan, a year-on-year increase of 52% [1] - The net profit attributable to shareholders reached 263 million yuan, up 84% year-on-year [1] - The non-recurring net profit was 250 million yuan, reflecting a 101% increase year-on-year [1] - The gross margin was 30.28%, an increase of 1 percentage point year-on-year, while the net margin was 10.97%, up 2 percentage points year-on-year [1] - In Q2 2025, the company reported operating revenue of 1.422 billion yuan, a 75% increase year-on-year and a 48% increase quarter-on-quarter [1] Product Development and Market Position - The company capitalized on the AI server opportunity, with drilling equipment revenue reaching 1.692 billion yuan in the first half of 2025, a 72% increase year-on-year [2] - The gross margin for drilling equipment was 26.10%, up 0.4 percentage points year-on-year [2] - The company has developed new drilling machines with advanced features, such as a 3D back drilling function, which have been certified by industry clients and are in high demand [2] - The laser drilling product matrix includes various types of laser drilling equipment tailored for different PCB segments, with ongoing upgrades to meet the evolving technical requirements of HDI products [3] - The company’s new laser processing solutions have achieved high precision requirements for small holes and complex shapes, gaining recognition and orders from downstream customers [3] Comprehensive Service Offering - The company is one of the largest providers of PCB specialized equipment, with detection equipment revenue of 209 million yuan, an 82% increase year-on-year, and a gross margin of 41% [4] - Exposure equipment revenue was 124 million yuan, down 23% year-on-year, while forming equipment revenue was 141 million yuan, up 4% year-on-year [4] - The company’s one-stop service significantly reduces customer procurement and maintenance costs, facilitating ongoing technical collaboration and communication with clients [4] Investment Outlook - The company is expected to achieve revenues of 4.973 billion yuan, 6.703 billion yuan, and 8.373 billion yuan for the years 2025 to 2027, with net profits of 596 million yuan, 822 million yuan, and 1.033 billion yuan respectively [4] - Corresponding price-to-earnings ratios are projected to be 63.22, 45.79, and 36.46 times for the same years [4] - The company is well-positioned to benefit from the growing demand in the AI server market and maintains a leading position in drilling equipment [4]

Group 1 - The global server market is entering a new growth cycle starting in 2024, driven by the increasing demand for AI computing power, with an expected CAGR of 18.8% from 2024 to 2029 [2] - The PCB industry is recovering from a phase of adjustment due to weak consumer electronics and inventory cycles, with emerging demands from AI servers and high-performance infrastructure expected to drive growth from 2024 [2][3] - Domestic PCB manufacturers are actively expanding production and increasing capital expenditures, focusing on high-end products such as HDI and multi-layer boards [2][3] Group 2 - The global PCB equipment market is projected to reach 51 billion yuan in 2024, with a year-on-year growth of 9.0%, and a CAGR of 4.9% from 2020 to 2024 [3] - The demand for PCB equipment is significantly boosted by AI computing infrastructure, with the market expected to grow to 77.5 billion yuan by 2029, reflecting a CAGR of 8.7% from 2024 to 2029 [3] - Drilling, exposure, and testing equipment represent the highest value segments in the PCB equipment market, accounting for 20.75%, 16.99%, and 15.00% respectively in 2024 [3] Group 3 - The drilling equipment segment is expected to benefit from increased demand for high-end HDI, with both mechanical and laser drilling seeing growth due to the rising complexity of HDI designs [3] - The exposure equipment market is currently dominated by foreign brands, with low domestic penetration, particularly in LDI technology which is more suited for HDI [4] - The demand for plating equipment is increasing due to the higher number of plating cycles required for advanced HDI, alongside quality control pressures [5] Group 4 - Major equipment manufacturers are showing a clear upward trend, with expectations for accelerated performance in the future [6] - Key players in the drilling segment include Dazhu CNC (301200), while the exposure segment is led by Xinqi Micro (688630) and Tianzhun Technology (688003) [7] - The plating segment is highlighted by Dongwei Technology (688700), with Keg Precision (301338) noted for its role in the solder paste printing segment [7]

Investment Rating - The report maintains a "Recommended" rating for leading PCB manufacturers such as Shenghong Technology, Pengding Holdings, and Huadian Co., Ltd. [4][5] Core Viewpoints - The PCB industry is experiencing rapid advancements in packaging and high-density interconnect technologies, with traditional HDI and substrate technologies evolving into mSAP processes to meet the demands of high-speed signal transmission and large-scale integration [1][2] - The demand for PCB is driven by AI applications, leading to significant expansions in production capacity among leading companies, with total investments exceeding 30 billion RMB [2][20] - The core materials for PCB, including copper foil, electronic cloth, and resin, are undergoing upgrades to meet the high-frequency and high-speed requirements of AI applications [2][20][26] Summary by Sections 1. CoWoP and mSAP as Core Technologies - CoWoP (Chip-on-Wafer-on-PCB) is emerging as a future packaging route, enhancing interconnect density and reducing costs by directly using large-size PCBs [1][11] - mSAP (Modified Semi-Additive Process) is becoming the core process for achieving sub-10 µm line capabilities, essential for high-performance applications [1][14] 2. PCB Capacity Expansion and Material Upgrades - Leading PCB manufacturers are actively expanding production capacity, with significant investments announced by companies like Huadian Co., Ltd. and Shenghong Technology [2][20] - The upgrade of core materials includes the transition of copper foil from HVLP1 to HVLP5, electronic cloth to third-generation low-dielectric cloth, and resin to hydrocarbon and PTFE types [2][20][28] 3. Tight Supply of Core Equipment and Acceleration of Domestic Substitution - The supply of core PCB equipment, including drilling, plating, and etching imaging, is tight, with domestic manufacturers accelerating their layouts in advanced process equipment [2][49] - Companies like Dazhu CNC and Ding Tai High-Tech are focusing on high-layer boards and HDI equipment to meet the increasing demands of the industry [2][49] 4. Investment Recommendations - The report suggests focusing on leading PCB manufacturers such as Shenghong Technology, Pengding Holdings, and Huadian Co., Ltd., as well as material companies with core technologies like Honghe Technology and Zhongcai Technology [3][4] - Equipment manufacturers involved in domestic substitution, such as Dazhu CNC and Xinqi Microelectronics, are also highlighted as potential investment opportunities [3][4]

Investment Rating - The report maintains a "Positive" investment rating for the PCB industry [3][11]. Core Insights - The PCB industry is experiencing growth driven by strong demand from AI applications and technological upgrades, leading to increased capital expenditures in downstream sectors [8][21]. - The global PCB market is expected to see differentiated growth across product segments, with high-density interconnect (HDI) boards benefiting from AI server demand, projected to grow by 18.8% year-on-year to reach $12.5 billion in 2024 [11][12]. - The report highlights a trend towards high-density, high-performance PCB products, with the combined market share of HDI and packaging substrates exceeding 34% [11][12]. Summary by Sections PCB Product Overview - PCB products are categorized into rigid boards, flexible boards, rigid-flex boards, and packaging substrates, with HDI boards widely used in consumer electronics and high-frequency boards for 5G communication [8][9]. Market Segmentation and Growth - In 2024, the global PCB market is projected to reach $73.57 billion, with multilayer boards holding the largest share at 38.1% [11][12]. - The smartphone sector accounts for 19% of the PCB market, with a projected value of $13.89 billion, while the server/storage sector is expected to grow by 33.1% year-on-year to $10.92 billion [15][16]. Regional Market Dynamics - China is expected to dominate the PCB market, with its share increasing from 54.4% in 2023 to 56.0% in 2024, reflecting its significant role in global PCB production [22][23]. Technological Advancements - The report emphasizes the need for PCB manufacturers to adapt to higher complexity and performance requirements driven by AI and high-speed networking, necessitating advancements in design and manufacturing processes [21][24]. Equipment and Supply Chain - The report outlines the production processes and key equipment used in PCB manufacturing, highlighting the importance of drilling equipment, which holds the highest market share in the PCB production process [31][34]. - The global drilling equipment market is projected to grow from $1.17 billion in 2020 to $1.47 billion in 2024, with a compound annual growth rate (CAGR) of 10.3% expected from 2024 to 2029 [38][43]. Market Trends and Future Outlook - The PCB industry is expected to continue evolving with the increasing demand for high-density and high-layer count boards, particularly in AI server applications, which are pushing the boundaries of PCB technology [27][28].

Core Viewpoint - The company Dazhu CNC Technology Co., Ltd. is set to go public on the Hong Kong Stock Exchange, following a significant recovery in the PCB industry driven by advancements in AI technology and the growth of the electric vehicle sector [1][2][3]. Company Overview - Dazhu CNC, established in 2002, specializes in providing production equipment solutions for PCB manufacturing, and has been the top-ranked company in the CPCA specialized equipment and instruments list since 2009 [1][2]. - The company was listed on the Shenzhen Stock Exchange in February 2022, with a current market capitalization exceeding 15.5 billion yuan [1]. - As of 2024, Dazhu CNC is the largest manufacturer of PCB production equipment globally, holding a market share of 6.5% [1][7]. Financial Performance - In 2024, Dazhu CNC achieved a revenue of 3.343 billion yuan, representing a year-on-year growth of 104.56% [3]. - The company's net profit and gross profit also saw significant increases, with net profit rising to 300 million yuan in 2024, a 120.82% increase from 2023 [3]. - Despite the recovery, the gross margin decreased from 34.02% in 2022 to 27.15% in 2024, primarily due to a shift in product mix and price adjustments in drilling equipment [3][4]. Industry Dynamics - The global PCB market is projected to grow from $65.2 billion in 2020 to $73.6 billion in 2024, with a compound annual growth rate (CAGR) of 3.1% [5]. - The demand for PCBs is expected to continue rising, driven by the increasing need for electronic devices and advancements in AI and automotive technologies [5]. - The competitive landscape in the PCB equipment sector is fragmented, with the top five players holding approximately 20.9% of the market share [7]. Investment Outlook - Dazhu CNC is well-positioned to benefit from the ongoing upgrades in the PCB industry and the trend of domestic substitution, supported by strong technical capabilities and a solid customer base [8]. - The company is seen as having significant long-term investment potential, especially with its upcoming secondary listing in Hong Kong [8].

Group 1 - Dazhu CNC has submitted a prospectus to the Hong Kong Stock Exchange for a dual listing after its A-share debut in 2022, aiming to raise funds for establishing a new factory and research center in Singapore, as well as hiring personnel for AI server and new energy vehicle PCB production equipment development [1] - Dazhu CNC, established in 2002, specializes in PCB production equipment solutions and has a comprehensive product matrix covering various PCB segments, making it a leader in the global PCB equipment industry [2][3] - The company has maintained a stable customer base, ranking first in the CPCA specialized equipment and instruments list for 16 consecutive years since 2009, with a global market share of 6.5% and a Chinese market share of 10.1% as of 2024 [3] Group 2 - The PCB equipment industry is entering a new era of intelligent production, with the market size in China expected to grow from approximately $3.306 billion in 2020 to about $4.111 billion in 2024, reflecting a compound annual growth rate (CAGR) of 5.6% [4] - Dazhu CNC's product sales are projected to reach 4,510 units in 2024, a 117% increase from 2,080 units in 2023, with an average product price remaining stable at 679,000 RMB per unit [4] - The company experienced a revenue decline from 2.786 billion RMB in 2022 to 1.634 billion RMB in 2023 due to a downturn in the PCB industry, but is expected to rebound to 3.343 billion RMB in 2024, driven by demand from the AI and electric vehicle sectors [6][7] Group 3 - Dazhu CNC's profit figures for 2022, 2023, and 2024 are approximately 432 million RMB, 136 million RMB, and 300 million RMB, respectively, with a declining gross margin from 34% in 2022 to 27.2% in 2024 due to the introduction of new automated drilling equipment [8] - The company's revenue structure is diverse, with drilling equipment accounting for 62.8% of revenue in 2024, followed by exposure equipment at 10.2%, highlighting the importance of these segments in the PCB production process [8] - Dazhu CNC is expanding its international business, particularly targeting the Southeast Asian market, with plans to establish a customer service center in Thailand and expand sales networks in Malaysia and Vietnam [8][9]