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2026-10-12 12:42:53 Citi published a report stating that, regarding recent reports that 3.2T optical modules require at least 65% of bill-of-materials value to come from US companies, coupled with reports that the US Department of Defense will ban Chinese printed circuit boards (PCB), China still accounts for around 75% of global copper clad laminate (CCL) supply in the artificial intelligence infrastructure hardware sector, making it difficult to replace Chinese copper clad laminates. The broker noted that reports of the US Department of Defense banning Chinese PCBs triggered a sharp selloff in the PCB/CCL sector last Friday, which it views as an attractive entry opportunity. Leveraging dominant scale and abundant capacity, Chinese copper clad laminate manufacturers should continue to expand global market share to support strong growth in NVIDIA Corporation (NVDA.US)/ASIC demand. Among artificial intelligence copper clad laminate/artificial intelligence PCB equipment-related stocks, the broker's order of preference is KB LAMINATES (01888.HK) > SYTECH (600183.SH) > HAN'S LASER (002008.SZ), citing stronger competitive positioning. The broker believes China's market share in artificial intelligence copper clad laminates should remain solid, mainly due to cost leadership driven by dominant scale, advantages in electricity costs, mature mainstream FR4 technology, the potential for rapid catch-up in artificial intelligence copper clad laminates, and the highly localized upstream raw material supply chain including copper foil and fiberglass cloth. The broker also noted that the global aerospace and defense PCB market is worth only about USD1.4 billion, compared with approximately USD58 billion in PCB output value in mainland China. The direct impact of the US defense ban is estimated to be well below 1% of China's PCB demand. Draft FCC rules exempt 800G/1.6T products, while 3.2T products are not expected to scale up until 2028, implying minimal demand impact in 2026-2027. In addition, Chinese PCB/CCL manufacturers are expanding overseas production capacity in Thailand, Vietnam and Malaysia. AASTOCKS Financial News Website: www.aastocks.com This article was automatically translated by AI, the Chinese version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. | |