Core Insights - The report highlights the strong performance of Celestica, which raised its annual revenue guidance to $11.55 billion, up from the previous $10.85 billion, driven by robust demand from major clients [12][13] - The AI PCB industry is experiencing a significant expansion due to high demand for advanced AI servers, leading to increased capital expenditures and a tight supply chain for PCB equipment [16][17] - The antibiotic sector, particularly for the company Federated Pharmaceuticals, is stable with a growing market for diabetes and animal health products, projecting net profits of 2.839 billion, 2.452 billion, and 2.705 billion for 2025-2027 [29][30] Total Research - As of July 29, 2025, the 10-year government bond yield is at 1.75%, up 11 basis points from the June low of 1.64% [3] - Historical patterns indicate that bond yields can reverse in either a V-shape or W-shape, with the latter often leading to a more significant upward movement [4][5] - The report anticipates that the 10-year government bond yield could rise to a target range of 1.9% to 2.2% in the second half of 2025, driven by economic recovery and inflation normalization [10] Industry Analysis - The communication sector is seeing increased demand for light modules and liquid cooling solutions, as indicated by Celestica's performance [12] - The PCB industry is entering a phase of intensive expansion, with several manufacturers announcing new projects to meet the rising demand for high-end products [17][18] - AI's impact on PCB performance is pushing for upgrades in materials and manufacturing processes, with a focus on higher layer counts and advanced techniques [19][20] Company-Specific Insights - Celestica's second-quarter revenue reached $2.89 billion, a 21% year-over-year increase, with a notable 82% growth in its hardware platform solutions segment [12] - The company is benefiting from strong demand from its top clients, which account for a significant portion of its revenue [12] - The report emphasizes the potential for significant growth in the PCB equipment market due to ongoing expansions and technological upgrades [16][18]

Investment Rating - The industry investment rating is "Positive" (maintained) [1] Core Insights - The report highlights a recovery in capital expenditure (Capex) among domestic internet companies, indicating a potential upward trend in the industry [3] - The report discusses the upcoming changes in materials and technologies in the PCB sector, emphasizing the need for new materials to meet the demands of advanced applications [4][5] Summary by Sections New Materials - The M9 level copper-clad laminate (CCL) is expected to undergo significant upgrades, with upstream materials needing to evolve to meet requirements for low dielectric constant and low expansion coefficient [3][4] - Key materials such as quartz fabric, PPO, and hydrocarbon resin are anticipated to become important choices in the future [3] New Architectures - Orthogonal backplanes may replace copper cables as a crucial connection method within cabinets, offering advantages in high-speed transmission and reduced heat generation [4] - The use of orthogonal backplanes is expected to increase PCB usage per cabinet, thereby boosting upstream material demand [4] New Packaging Technologies - Advanced packaging techniques such as PCB process substrate, embedded components, and glass-based materials are evolving to reduce signal loss and improve power integrity [5] - The new packaging methods will require higher specifications for PCB dimensions and will necessitate collaboration across multiple stages, including testing and packaging [5] Investment Recommendations - The report suggests focusing on various aspects such as technological capabilities, production expansion pace, and customer development [6] - Beneficiary stocks in the upstream materials segment include companies like Feilihua, Honghe Technology, and Zhongcai Technology [6] - Beneficiary stocks in the CCL segment include Shengyi Technology and Nanya New Materials [6] - Beneficiary stocks in the PCB segment include companies like Huitian Technology, Shenchao Technology, and Jingsheng Electronics [6]