Core Viewpoint - The company is actively developing and expanding its production capacity for spherical silica and titanium oxide products to meet the high-performance demands of downstream customers, particularly in relation to the new M9 material being used by Nvidia in its upcoming Rubin generation [1] Group 1 - Nvidia has confirmed that the new generation Rubin will utilize M9 materials, with a significant increase in the use of spherical silica micro-powder, doubling the amount compared to previous generations [1] - The company has completed the development of multiple products, including spherical silica and both spherical and angular titanium oxide, to satisfy customer requirements [1] - The company is currently collaborating with downstream customers for product validation and is actively advancing its capacity expansion efforts [1]

Market Overview - The A-share market experienced significant gains, with all three major indices rising collectively, and the ChiNext index reaching a new high for the year with a nearly 3% increase in a single day [1] - The trading volume in the Shanghai and Shenzhen markets exceeded 2.26 trillion yuan, showing a notable increase compared to the previous day [1] - There was a clear divergence among sectors, with Hainan, photovoltaic, and non-ferrous metals leading the gains, while banking and film sectors showed relatively weak performance [1] Research Insights - CICC expressed a cautious view on the future policy path of the Federal Reserve, suggesting that the pace of interest rate cuts may slow down. Despite a rate cut in October, Powell's statements leaned hawkish, creating uncertainty about further cuts in December [3] - CICC noted an increased internal support for pausing rate cuts, indicating that future easing measures may be more cautious and not overly optimistic. The current round of rate cuts may have a weaker stimulating effect on the economy due to a diminishing "refinancing effect" [3] - Huatai Securities shifted focus to U.S. power infrastructure development, particularly the impact of AI on energy demand. They highlighted a $550 billion investment plan under the Japan-U.S. cooperation framework, with an $80 billion nuclear investment led by Westinghouse as a key highlight [3] - Huatai suggested that rising demand for data center connectivity is increasing pressure on U.S. power supply, which may be temporarily addressed by delaying coal power retirements and developing solar storage and solid oxide fuel cells, while long-term solutions will rely on large-scale gas turbine and nuclear power construction [3] - Guotai Junan Securities focused on the technological evolution in the AI new materials sector, indicating that the application of M9 materials could drive upgrades in the industry chain. Companies expressed optimistic growth expectations and plans to expand capacity at recent industry exhibitions [4] - Guotai Junan analyzed that if the M9 solution is implemented, copper foil may shift to HVLP4 types, electronic fabrics will likely use a combination of Q fabric and second-generation fabric, and resins may trend towards hydrocarbon types. The increased hardness of Q fabric could raise the difficulty of PCB processing, thereby increasing demand for drilling needles and benefiting laser drilling technology [4]

Group 1 - A-shares opened lower with the Shanghai Composite Index down 0.21%, Shenzhen Component Index down 0.22%, and ChiNext Index down 0.32% on October 30 [1] - Sectors such as Fujian, CPO, coal, and precious metals experienced significant declines [1] Group 2 - China International Capital Corporation (CICC) suggests that the Federal Reserve's rate cut pace may slow down, advising against overly optimistic expectations [2] - CICC notes that while the Fed has room for further easing, the impact of the current rate cuts may be weaker than in previous cycles due to a diminished refinancing effect [2] - The Fed plans to end quantitative tightening in December, which CICC interprets as a technical consideration rather than a significant policy shift [2] Group 3 - Huatai Securities highlights that the US and Japan are investing $550 billion in power infrastructure, with Westinghouse leading an $80 billion nuclear investment [3] - The firm emphasizes the accelerating role of AI in the construction of the US power system, driven by high demand for data center connectivity and the need for grid expansion [3] - Predictions indicate a delay in coal power retirements in the short term, with a focus on large gas turbines and nuclear power in the long term, suggesting growth opportunities in various segments of the new energy sector [3] Group 4 - Guojin Securities remains optimistic about AI-driven new materials, noting positive expectations from the recent TPCA SHOW regarding industry growth [4] - The firm anticipates that leading companies will actively expand production to meet high demand, particularly in M9 materials [4] - Market attention is expected to focus on the confirmation of material solutions, usage rates, and price potential due to supply tightness [4]

Market Overview - The market experienced a significant rally with major indices opening high and closing positively, with the ChiNext Index rising nearly 3% to reach a new high for the year, and the Shanghai Composite Index surpassing 4000 points again [1] - The total trading volume in the Shanghai and Shenzhen markets reached 2.26 trillion yuan, an increase of 108.2 billion yuan compared to the previous trading day [1] - Sector performance varied, with Hainan, photovoltaic, and non-ferrous metals leading the gains, while banking and film exhibition sectors faced declines [1] Monetary Policy Insights - China International Capital Corporation (CICC) suggests that the Federal Reserve's rate cut pace may slow down, advising against overly optimistic expectations [2] - CICC anticipates a 25 basis point rate cut in the October meeting, but notes that Fed Chair Powell's comments indicate a hawkish stance, suggesting that the support for pausing rate cuts is gaining traction within the Fed [2] - The current round of rate cuts may have a weaker stimulating effect compared to previous cycles due to a noticeable reduction in refinancing effects [2] Infrastructure Investment - Huatai Securities highlights that the U.S. is set to invest $800 billion in nuclear power, leading the charge in AI infrastructure development [3] - The $550 billion investment framework between Japan and the U.S. supports power infrastructure, with a focus on base-load power sources, grid equipment, and energy storage [3] - The report predicts a delay in the retirement of coal power plants in the short term, an increase in large gas turbine construction in the medium term, and a long-term focus on nuclear power [3] Material Sector Developments - Guojin Securities expresses optimism about AI-driven new materials, noting that recent industry events have shown positive expectations for growth [4] - The M9 material upgrade could lead to advancements in material solutions, such as the potential shift towards HVLP4 copper foil and enhanced PCB processing capabilities [4] - Market attention is expected to focus on the confirmation of material solutions, usage rates, and price dynamics due to supply constraints [4]

Core Viewpoint - The report from Guojin Securities expresses optimism about AI-driven new materials, highlighting the positive expectations for industry growth as indicated by the recent TPCA SHOW [1] Group 1: Industry Outlook - Leading companies are expected to actively expand production to meet high demand [1] - The market will focus on the confirmation rhythm of solutions, usage volume, and price space due to supply tightness [1] Group 2: Material Upgrades - M9 is anticipated to bring material solution upgrades, such as copper foil potentially leaning towards HVLP4 [1] - Electronic fabrics are expected to evolve into Q fabric combined with second-generation fabric [1] - Resins are projected to shift towards hydrocarbon resins, influenced by the increased hardness of Q fabric, which may complicate PCB processing [1] Group 3: Equipment and Consumption - The demand for drilling needles as consumables is expected to rise, along with positive impacts on laser drilling [1]

Summary of PCB Industry Conference Call Industry Overview - The PCB market is undergoing continuous iteration, reflected in improvements in embedded capacitors, Cover P solutions, and upstream materials like copper foil and fabric, with a strong market performance since Q2 indicating sustained industry prosperity [1][3] - Domestic CCL companies are increasing their participation, accelerating domestic substitution and gaining market share, enhancing confidence in the mainland supply chain [1][5] - The M9 material, although not yet in mass production, shows significant potential for enhancement in server ESP applications [1][4] Key Trends and Developments - Liquid cooling technology plays a crucial role in enhancing AI computing power by effectively addressing heat dissipation issues, thereby improving system stability and performance [1][6] - The PCB industry is evolving towards low-loss and high-precision standards, with a transition from M6 to M9 materials, increasing circuit complexity and layer counts, and upgrading to class carrier technologies and PDF materials [1][10] - The high-end copper-clad laminate market is expected to reach a demand of 100 billion yuan by 2026, with copper-clad laminate costs accounting for about half of this, indicating a substantial market opportunity [1][12][13] Company Insights - Leading companies in the domestic market include Xingsen and Shennan, which are at the forefront of carrier board technology, while other listed companies are relatively late entrants [4] - The M9 material is highlighted as a key focus for future development, with its low loss characteristics driving the high-end product trend and promoting domestic substitution of critical equipment and materials [1][7] Market Dynamics - The domestic PCB industry is experiencing rapid increases in domestic substitution rates, with a shift from reliance on Taiwanese enterprises to a growing number of capable domestic CCL companies [5] - The upgrade of materials is not only advancing the development of copper-clad laminate manufacturers but also driving the overall upgrade of the chemical and upstream industries, necessitating advanced raw materials and new equipment [16] Future Outlook - The future development of narrow board technology is expected to focus on further improving precision and integration, potentially replacing existing HDI technology [18][19] - High-end PCB products are projected to have a broad market application outlook, with companies like Shengyi Technology continuously enhancing product quality to meet market demands [20] - Upcoming projects worth monitoring include the transition from HDR to narrow board technology and the development of interposers using silicon carbide, which may lead to new market opportunities [22] Conclusion - The PCB industry is poised for significant growth driven by technological advancements, material upgrades, and increasing domestic capabilities, presenting numerous investment opportunities in the coming years [14][21]

Group 1: Nvidia's New Product and Market Impact - Nvidia has confirmed the use of M9 materials in its next-generation product Rubin, with the CPX and midplane PCBs utilizing M9 CCL, amid a shortage of Q cloth [1] - The Rubin CPX is designed for ultra-long context AI inference tasks, featuring a decoupled inference architecture and significant hardware changes, including a wireless cable architecture [1] - The market potential for CPX, midplane, and orthogonal backplane is nearly 100 billion [1] - By 2027, Nvidia's AI PCB market is projected to reach $6.96 billion, a 142% increase from 2026 [1] Group 2: PCB Industry Growth Driven by AI - The global PCB market is expected to grow from $62 billion in 2020 to $75 billion by 2024, with a compound annual growth rate of 4.9% [2] - The value of PCBs in AI servers is significantly higher than in traditional servers, leading to a substantial increase in demand for high-performance PCBs [3] - Low dielectric constant and low loss factor materials are deemed most suitable for high-performance applications, with Q cloth outperforming second-generation cloth [3] Group 3: Recommendations for M9 and Related PCB Manufacturers - Strong recommendations have been made for M9 upstream and related PCB manufacturers, with companies like 建滔积层板 reporting a revenue increase of 11% year-on-year [4] - 建滔集团 is expanding its production capabilities for AI-related products, with a projected investment of approximately 800 to 1,000 million RMB for a new production line [4] - The demand for copper-clad laminates and printed circuit boards is expected to rise significantly due to the rapid development of AI technologies [4]

Group 1: Nvidia's New Product and Market Impact - Nvidia is set to launch its new product series, Rubin, in the second half of next year, utilizing M9 materials for its CPX and midplane PCBs due to a shortage of quartz fabric [1] - The Rubin CPX is designed specifically for long-context AI inference tasks, featuring a decoupled inference architecture and significant hardware innovations, which are expected to expand its market size [1] - According to CICC, the AI PCB market for Nvidia is projected to reach $6.96 billion by 2027, representing a 142% increase from 2026 [1] Group 2: PCB Industry Growth Driven by AI - The global PCB market is expected to grow from $62 billion in 2020 to $75 billion by 2024, with a compound annual growth rate (CAGR) of 4.9% [2] - The demand for high-performance PCBs is anticipated to rise significantly due to the higher value of AI server PCBs compared to traditional servers, with low dielectric constant materials being preferred [3] Group 3: Recommendations for M9 and Related PCB Manufacturers - Strong recommendations have been made for M9 upstream and related PCB manufacturers, with companies like Kintor achieving a revenue of HKD 9.588 billion in the first half of the year, a year-on-year increase of 11% [4] - Kintor Group is actively developing high-frequency and high-speed products for AI server GPU motherboards and plans to establish an AI PCB production line in Guangdong with an investment of approximately RMB 800 million to 1 billion [4]

Group 1 - Broadcom's AI semiconductor revenue reached $5.2 billion in FY25Q3, representing a 63% year-over-year increase and an $800 million quarter-over-quarter increase, exceeding previous guidance of $5.1 billion [1] - The XPU business accounted for 65% of AI semiconductor revenue, with expectations for AI revenue to reach $6.2 billion in FY25Q4, reflecting a $1 billion quarter-over-quarter increase [1] - Broadcom's total backlog reached $110 billion, with a new customer securing $10 billion in AI orders, indicating potential growth in FY26 [1] Group 2 - The demand for ASICs is expected to surge due to increased downstream inference demand, with major companies like Google, Amazon, and Meta rapidly developing ASIC chips [1] - NVIDIA's NVL72 rack quantity is anticipated to exceed expectations next year due to strong demand and improved yield capacity [1] - The AI PCB market is expected to see significant growth, with companies actively expanding production in response to strong orders [1] Group 3 - The investment outlook is positive for AI-PCB and computing hardware, as well as the Apple supply chain and industries benefiting from AI-driven and self-controlled technologies [2] - The demand for AI copper-clad laminates is robust, with a shift towards M8 materials in AI servers and switches, and potential future adoption of M9 materials [2] - Various segments such as consumer electronics, PCB, semiconductor chips, and passive components are showing stable to upward trends in their respective markets [2]

Summary of Conference Call on Electronic Fabric Industry Industry Overview - The conference call focused on the electronic fabric industry, specifically discussing advancements in PCB (Printed Circuit Board) technologies and materials used in various architectures such as GP300, GB200, and Rubin series [2][4][6]. Key Points and Arguments 1. **Material Upgrades and Usage**: - GP300 architecture has reverted to PCB solutions, increasing PCB usage and material grades. The Rubin series is testing PTFE1 and Ma9 grade materials, with NV actively evaluating Ma9 materials [2][4]. - GP300 employs HDI design with approximately 20+ layers, while GB200's actual layer count increased from 30 to nearly 40 layers, significantly enhancing CCL (Copper Clad Laminate) and BS (Binding System) material usage and value [2][6]. 2. **Price Changes**: - In GB200, the computer section is priced around $500-$600, while the switch section exceeds $1,000. In GP300, the switch section's value increased by 30%, from $1,000 to $1,500 [7][8]. - The Rubin series is expected to see a price coefficient increase of 2-2.5 times, with each board potentially exceeding $4,000 [7][8]. 3. **Supply Chain Dynamics**: - There is a significant disparity in yield rates among glass fabric manufacturers, with major suppliers including Asahi Glass (Japan), Taiwan Glass, and Taishan Fiberglass (China) [10][11]. - Ordinary fiberglass is priced around 10 RMB, while first-generation Low DK is priced at 30-40 RMB, and quartz (Q) prices are at least double that of the second generation [14]. 4. **Testing and Evaluation**: - The M9 and QQ material testing is being conducted in three tiers, with NV having completed initial evaluations and AWS, Google, and Meta expected to finish testing by Q3 2025 [3][16]. - The performance of quartz fabric varies significantly between manufacturers and even between batches from the same manufacturer, indicating instability in quality [17]. 5. **Market Demand and Supply Challenges**: - The demand for electronic fabrics is expected to increase, with potential supply bottlenecks anticipated in the mid-range output due to tight supply of first-generation Low DK glass fabric [29][30]. - The expansion cycle for electronic fabric production typically takes 1 to 1.5 years, with quartz fabric potentially requiring an additional 20-30% more time [28]. 6. **Future Trends**: - The initial pricing of new electronic fabrics is typically around 2.5 times that of the previous generation, decreasing to below 2 times during mass production, with a target stabilization at 1.5 times [31]. - The market for second-generation fabrics is expected to remain tight, with prices likely to hold steady due to high demand and limited supply [35]. Additional Important Insights - The current focus on testing indicators emphasizes DK and DF values, with stability in performance being a primary concern [27]. - The entry of new suppliers into the electronic fabric market is cautious, with established relationships and technical capabilities being prioritized [20]. - The market share for first-generation electronic paper suppliers shows that the top three suppliers account for approximately 60% of the total procurement volume [32][33]. This summary encapsulates the critical discussions and insights from the conference call, highlighting the evolving landscape of the electronic fabric industry and its implications for future investments and market dynamics.