Investment Rating - The report maintains a "Buy" rating for the company [5] Core Views - The company has significantly improved its profitability, with a revenue of 9.031 billion yuan in H1 2025, representing an 86% year-on-year increase, and a net profit of 2.143 billion yuan, up 366.89% year-on-year [1] - The company is a global leader in AI PCB technology, having achieved breakthroughs in high-layer and high-density interconnect (HDI) technologies, and is actively advancing next-generation HDI product development [2][4] - The company is expanding its production capacity and global presence to meet the increasing demand for high-end PCBs, with new facilities in Thailand and Vietnam to enhance delivery capabilities [3] Financial Performance - In Q2 2025, the company reported a revenue of 4.72 billion yuan, a 91.5% year-on-year increase, and a net profit of 1.22 billion yuan, up 390.1% year-on-year [1] - The gross profit margin for H1 2025 was 36.22%, an increase of 15.6 percentage points year-on-year, while the net profit margin was 23.7%, up 14.3 percentage points year-on-year [1] - The company plans to increase its revenue forecasts for 2026 and 2027 to 34.8 billion yuan and 54.8 billion yuan, respectively, with net profit estimates of 11 billion yuan and 18 billion yuan [9] Research and Development - The company has increased its R&D expenditure to 353 million yuan in H1 2025, a 78.5% year-on-year increase, and 223 million yuan in Q2 2025, up 108% year-on-year [4] - The company is focusing on advanced technologies such as PCIe6 and high-speed transmission devices, while also developing next-generation HDI and ultra-high-layer multi-layer PCBs [4][9] - The company is committed to using cutting-edge materials to enhance electrical performance and reduce signal loss, particularly in high-frequency and high-speed applications [4]

Core Viewpoint - Pengding Holdings, a leading global PCB company, has experienced significant revenue and profit growth driven by its strategic positioning in the AI sector and robust operational strategies [1][2]. Financial Performance - In the first half of 2025, the company achieved revenue of 16.38 billion yuan, a year-on-year increase of 24.8%, with net profit around 1.2 billion yuan, reflecting a growth rate exceeding 50% [1][2]. - The second quarter of 2025 saw remarkable growth, with revenue reaching 8.29 billion yuan, up 28.7%, and net profit soaring by 159.5% to 745 million yuan [2]. - The operating cash flow for the first half of 2025 was 4.277 billion yuan, marking a 53.3% increase year-on-year [2]. Market Position and Strategy - The company has leveraged its leadership in the FPC industry to capitalize on the AI edge computing trend, focusing on high-end HDI products for the server and optical module markets [1][6]. - Pengding Holdings has maintained a strong financial position, with a debt-to-asset ratio of only 29.24% and cash assets amounting to 13 billion yuan as of June 30, 2025 [1][6]. R&D and Product Development - The company is actively advancing its R&D and marketization processes, particularly in high-end products for AI servers and optical communications [1][6][7]. - As of June 30, 2025, Pengding Holdings had applied for 2,732 patents, with 1,525 patents granted [7]. Geographic Revenue Distribution - In the first half of 2025, revenue from the U.S. region was 13.08 billion yuan, accounting for 79.87% of total revenue [6]. - The company has consistently generated a significant portion of its revenue from overseas markets, particularly the U.S., with revenue from this region increasing from 20.6 billion yuan in 2020 to 28.88 billion yuan in 2024 [5][6]. Institutional Interest - As of August 12, 2025, 47 institutional investors held shares in Pengding Holdings, collectively owning 1.866 billion shares, which is 80.52% of the total share capital [3]. - The top ten institutional investors account for 79.91% of the holdings, including notable entities such as the Hong Kong Central Clearing Limited and the National Social Security Fund [3].