2025-12-15 01:55Summary of Shennan Circuit Conference Call Company Overview - Company: Shennan Circuit (002916.SZ) - Industry: Printed Circuit Board (PCB) and Copper Clad Laminate (CCL) Key Points Incentive Plan - Shennan announced a Phase II Restricted Stock Incentive Plan, granting 15.16 million shares (2.27% of total issued capital) to 667 key personnel at a price of RMB 114.72/share [1][2] - The plan aims to align key talent with shareholder interests during the AI upcycle, with stringent unlocking criteria including: - Recurring net profit CAGR of ≥13% compared to 2024 - Continuous ROE improvement to >12.8% by 2028 - Performance in the 75th percentile of industry peers [1][2] Financial Performance Expectations - The incentive scheme is designed to ensure double-digit year-on-year growth during 2026-2028E and to outperform major peers [2] - The exercise price reflects a 40% discount from the closing price of RMB 191.2/share prior to the announcement [2] Market Position and Valuation - Shennan's target price is set at RMB 281, indicating an expected share price return of 46.1% and a total return of 47.1% [3] - The company is positioned as a key player in the domestic AI server and auto segments, contributing over 55% of total PCB sales [7] - The target PE of 48x forward reflects a 40-50% premium to the sector average, justified by Shennan's leading position and technology leadership [7] Risks - Potential downside risks include: - Slower-than-expected growth in the China AI server market - Weaker demand for auto and ADAS systems - Lower-than-expected profits from the new plant in Wuxi - Higher laminate cost inflation [8] Conclusion - The recent stock price retreat of over 20% from the year-to-date peak in early October has led to a reiteration of the Buy rating [1]