Cost improvement, base stations and automotive electronics boost the performance of PCB companies
Nov 13,2021
For a long time, PCB industry chain companies have been affected by the price increase of upstream material copper clad laminates. Not only have their performance been under pressure, but practitioners have complained that the upstream price increase is too high and the downstream is difficult to pass on the cost smoothly. The stock price of related listed companies has also continued to be sluggish. . However, after the release of the third quarterly report, this situation has been significantly improved.
According to the author’s statistics, most PCB companies’ performance in the third quarter of this year showed signs of improvement compared to the previous ones, with significant improvements year-on-year and quarter-on-quarter. Driven by their performance, the share prices of listed companies in the secondary market have also bottomed out.
Base station construction speeds up, and automotive electronics becomes incremental
The industry knows that as the upstream of PCB, copper clad laminate is the main raw material of PCB. Due to the high concentration of the industry and strong voice, the ability to pass costs downstream far exceeds that of PCB companies. Therefore, its substantial and long-term price increase will undoubtedly put PCB companies under pressure on both the operating and performance levels.
Since the second half of last year, copper clad laminate manufacturers have begun to raise prices due to the impact of upstream copper foil prices. It is reported that the 1.2mm standard FR4 thick plate has a high point of more than 200 yuan per sheet. Taking the copper clad laminate giant Kingboard laminate as an example, the company has raised prices five times in the second half of last year, with a cumulative price increase of more than 30%. In addition, some companies even raise prices for some models by more than 60%.
According to the author’s understanding, this round of price increases has lasted for more than a year. The latest price increase was in August of this year. It was still announced by a number of manufacturers, led by Kingboard laminates, because of copper foil and other raw materials. Increase the price of copper clad laminates.
Some brokerage analysts pointed out that the price of copper clad laminates increased by 20% in the first quarter of this year, and continued to increase prices by 30% in the first two months of the second quarter. The price increase of some thick plates has basically doubled, and thin plates have also increased by 30%. -50% increase. However, there was a slight price cut from June to July, and a short window of opportunity appeared.
"In the production of PCB in the third quarter, some raw materials were purchased from the window period from June to July. In addition, PCB companies also started to raise prices due to cost reasons. This action was basically in the first and second quarters of this year. The beginning of the quarter, the third quarter also showed some benefits." The analyst added.
In terms of downstream demand, the annual target of 5G base stations is 600,000, but since only 31% of the annual target was completed in the first half of the year, the construction of the base stations fell short of expectations, resulting in PCB company performance under pressure. However, in the second half of the year, the bidding for base stations and bearer network equipment of operators has begun, and the pace of base station construction has also been significantly accelerated, which will also bring a new round of opportunities to the industry chain.
Related practitioners told the author that the PCB market has indeed shown signs of improvement in recent times, especially in the server field.
In addition, new energy vehicles have become another incremental factor. "The increase in the ASP of electric vehicles over doubling the growth of traditional fuel vehicles will definitely increase the industry. Starting from August, domestic electric vehicles have increased in varying degrees on a month-on-month basis, directly driving the development of PCB connectors. Order growth.” The aforementioned analyst said.
Q3 single quarter performance is good
Although it is not yet known whether the price of copper clad laminates has stabilized, PCB manufacturers' performance in the third quarter has begun to improve, and the stock prices of related companies have continued to rise for the past week.
Moreover, judging from the situation of the three quarterly reports, many PCB companies have shown strong resilience in dealing with price increases. In the face of upstream price increases, when downstream demand is improving, they will be transferred to the downstream industry in a timely manner. And seize the price cut window period to form a mismatch of cost prices.
According to wind data, among the 35 companies, only ST Fangke, Hongxin Electronics, and *ST Danbang suffered losses in a single quarter in the third quarter. In terms of revenue, the revenue of 30 companies all achieved different growth rates year-on-year, and 5 companies experienced a year-on-year decline; 27 companies achieved year-on-year growth, and only 8 companies experienced a year-on-year decline.
In terms of net profit, 22 companies achieved year-on-year growth, while 13 companies experienced a year-on-year decline; 19 companies increased month-on-month and 16 companies experienced a month-on-month decline.
According to the author’s statistics, most PCB companies’ performance in the third quarter of this year showed signs of improvement compared to the previous ones, with significant improvements year-on-year and quarter-on-quarter. Driven by their performance, the share prices of listed companies in the secondary market have also bottomed out.
Base station construction speeds up, and automotive electronics becomes incremental
The industry knows that as the upstream of PCB, copper clad laminate is the main raw material of PCB. Due to the high concentration of the industry and strong voice, the ability to pass costs downstream far exceeds that of PCB companies. Therefore, its substantial and long-term price increase will undoubtedly put PCB companies under pressure on both the operating and performance levels.
Since the second half of last year, copper clad laminate manufacturers have begun to raise prices due to the impact of upstream copper foil prices. It is reported that the 1.2mm standard FR4 thick plate has a high point of more than 200 yuan per sheet. Taking the copper clad laminate giant Kingboard laminate as an example, the company has raised prices five times in the second half of last year, with a cumulative price increase of more than 30%. In addition, some companies even raise prices for some models by more than 60%.
According to the author’s understanding, this round of price increases has lasted for more than a year. The latest price increase was in August of this year. It was still announced by a number of manufacturers, led by Kingboard laminates, because of copper foil and other raw materials. Increase the price of copper clad laminates.
Some brokerage analysts pointed out that the price of copper clad laminates increased by 20% in the first quarter of this year, and continued to increase prices by 30% in the first two months of the second quarter. The price increase of some thick plates has basically doubled, and thin plates have also increased by 30%. -50% increase. However, there was a slight price cut from June to July, and a short window of opportunity appeared.
"In the production of PCB in the third quarter, some raw materials were purchased from the window period from June to July. In addition, PCB companies also started to raise prices due to cost reasons. This action was basically in the first and second quarters of this year. The beginning of the quarter, the third quarter also showed some benefits." The analyst added.
In terms of downstream demand, the annual target of 5G base stations is 600,000, but since only 31% of the annual target was completed in the first half of the year, the construction of the base stations fell short of expectations, resulting in PCB company performance under pressure. However, in the second half of the year, the bidding for base stations and bearer network equipment of operators has begun, and the pace of base station construction has also been significantly accelerated, which will also bring a new round of opportunities to the industry chain.
Related practitioners told the author that the PCB market has indeed shown signs of improvement in recent times, especially in the server field.
In addition, new energy vehicles have become another incremental factor. "The increase in the ASP of electric vehicles over doubling the growth of traditional fuel vehicles will definitely increase the industry. Starting from August, domestic electric vehicles have increased in varying degrees on a month-on-month basis, directly driving the development of PCB connectors. Order growth.” The aforementioned analyst said.
Q3 single quarter performance is good
Although it is not yet known whether the price of copper clad laminates has stabilized, PCB manufacturers' performance in the third quarter has begun to improve, and the stock prices of related companies have continued to rise for the past week.
Moreover, judging from the situation of the three quarterly reports, many PCB companies have shown strong resilience in dealing with price increases. In the face of upstream price increases, when downstream demand is improving, they will be transferred to the downstream industry in a timely manner. And seize the price cut window period to form a mismatch of cost prices.
According to wind data, among the 35 companies, only ST Fangke, Hongxin Electronics, and *ST Danbang suffered losses in a single quarter in the third quarter. In terms of revenue, the revenue of 30 companies all achieved different growth rates year-on-year, and 5 companies experienced a year-on-year decline; 27 companies achieved year-on-year growth, and only 8 companies experienced a year-on-year decline.
In terms of net profit, 22 companies achieved year-on-year growth, while 13 companies experienced a year-on-year decline; 19 companies increased month-on-month and 16 companies experienced a month-on-month decline.
Among them, Pengding Holdings' revenue in the third quarter was 9.049 billion yuan, a record high in a single quarter, a year-on-year increase of 23.1% and a month-on-month increase of nearly 45%. In addition, the company achieved a net profit of 1.045 billion yuan, an increase of 77.63% year-on-year and a 2.7-fold increase from the previous month.
In the third quarter, Shennan Circuit achieved revenue of 3.875 billion yuan, achieving a growth rate of more than 20% year-on-year and quarter-on-quarter; net profit reached 466 million yuan, an increase of 24.4% year-on-year, but a 46.82% increase from the previous quarter, and third The quarterly net profit created a record high in a single quarter.
Previously, Shennan Circuits told the author that the company’s packaging substrate business is currently full, and the demand in downstream automotive and other fields is relatively strong. From a long-term perspective, it is still more optimistic about future development.
In addition, Suntak Technology achieved revenue of 1.765 billion yuan in the third quarter, an increase of 56.98% year-on-year and a month-on-month increase of 24.66%, while net profit of 230 million yuan doubled year-on-year and a growth rate of 67.71% month-on-month.
At present, it can be clearly seen that as the profitability of mainstream PCB manufacturers is gradually recovering, the PCB sector that has been declining for a long time has recently ushered in a valuation restoration, and the skyrocketing performance has also been reflected in the secondary market.
According to the author's understanding, the A-share PCB sector has risen sharply in the past week. Suntak Technology has risen by nearly 40% in the past two weeks and 19.72% this week; Shennan Circuit has risen by more than 27% this week, and Shiyun Circuit has soared. 25.3%, a cumulative increase of nearly 70% in the past two months; Ultrasonic Electronics, Pengding Holdings and Jingwang Electronics rose 16.8%, 14.95% and 12.3% respectively this week.
Although the stock prices of many PCB companies have begun to rebound under the blessing of performance, since the raw materials of copper clad laminates such as copper foil and epoxy resin have not yet seen signs of price decline, PCB companies are still facing cost problems in the future.
As for whether there will be subsequent price increases for CCL, a brokerage analyst said: "PCB cost pressures remain in the fourth quarter. As for whether there will be price increases, it is still uncertain. It is not recommended to pre-set CCL costs to improve significantly. ."
In the third quarter, Shennan Circuit achieved revenue of 3.875 billion yuan, achieving a growth rate of more than 20% year-on-year and quarter-on-quarter; net profit reached 466 million yuan, an increase of 24.4% year-on-year, but a 46.82% increase from the previous quarter, and third The quarterly net profit created a record high in a single quarter.
Previously, Shennan Circuits told the author that the company’s packaging substrate business is currently full, and the demand in downstream automotive and other fields is relatively strong. From a long-term perspective, it is still more optimistic about future development.
In addition, Suntak Technology achieved revenue of 1.765 billion yuan in the third quarter, an increase of 56.98% year-on-year and a month-on-month increase of 24.66%, while net profit of 230 million yuan doubled year-on-year and a growth rate of 67.71% month-on-month.
At present, it can be clearly seen that as the profitability of mainstream PCB manufacturers is gradually recovering, the PCB sector that has been declining for a long time has recently ushered in a valuation restoration, and the skyrocketing performance has also been reflected in the secondary market.
According to the author's understanding, the A-share PCB sector has risen sharply in the past week. Suntak Technology has risen by nearly 40% in the past two weeks and 19.72% this week; Shennan Circuit has risen by more than 27% this week, and Shiyun Circuit has soared. 25.3%, a cumulative increase of nearly 70% in the past two months; Ultrasonic Electronics, Pengding Holdings and Jingwang Electronics rose 16.8%, 14.95% and 12.3% respectively this week.
Although the stock prices of many PCB companies have begun to rebound under the blessing of performance, since the raw materials of copper clad laminates such as copper foil and epoxy resin have not yet seen signs of price decline, PCB companies are still facing cost problems in the future.
As for whether there will be subsequent price increases for CCL, a brokerage analyst said: "PCB cost pressures remain in the fourth quarter. As for whether there will be price increases, it is still uncertain. It is not recommended to pre-set CCL costs to improve significantly. ."