Popular Groups》Copper Foil Substrate Upgrade Wave Coming, Price Increase Trend Until 2027

[Reporter Zhuo Yijun/Special Report] Benefiting from the continued expansion of demand related to AI infrastructure such as AI servers, high-speed network communications and memories, there is strong demand for large-size, high-multilayer boards (more than 40 layers) and extremely low-loss PCB boards. The copper foil substrate (CCL) market is in a golden development period of "both volume and price". Taiwan's copper foil substrate manufacturers accounted for 37.4% of the global market last year. Due to rising upstream costs and tight supply, copper foil substrate prices will continue to rise until 2027. Taiwan Optoelectronics (2383), Taiyao (6274), Lianmao (6213), and Tenghui-KY (6672) have entered a period of explosive profits. Last week, the stock prices of the copper foil substrate group performed brilliantly. Tenghui and Lianmao each saw weekly gains of 26.4% and 18%, and they were all divided into separate markets. Taiwan Optoelectronics and Taiyao increased by 15.7% and 7.4% respectively.

Taiwan Optoelectronics, the global leader in copper foil substrates, has earned more than one equity share each quarter for six consecutive quarters. In the second quarter, after-tax earnings (EPS) per share reached 27.55 yuan, and the cumulative EPS in the first half of the year was as high as 42.46 yuan. Taiwan Optoelectronics' single-month revenue hit a new high for seven consecutive months. The cumulative consolidated revenue in the first nine months of this year was 141.226 billion yuan, an annual increase of 103.69%. Taiwan Optoelectronics said that the demand for applications such as AI servers, general servers, switches, low-orbit satellites and memory modules is growing steadily, and it is expected to continue the trend of "full production and full sales" in the next year.

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Taiyao's single-month revenue has also set a new record for seven consecutive months. The cumulative consolidated revenue in the first nine months of this year was 42.3 billion yuan, an annual increase of 99.4%. Due to the upgrade of customer specifications, the expansion of the use of M8-M9 high-end copper foil substrates, as the production capacity of Thai factories is gradually opened, will drive future growth momentum.

Lianmao's single-month revenue has also hit a new high for seven consecutive months. The cumulative consolidated revenue in the first nine months of this year is 36.29 billion yuan, an annual increase of 50%. Mainly due to the price increase effect and the growth of AI-related demand, Lianmao's after-tax earnings per share in August were 2.54 yuan, an annual increase of 840.74%. Legal persons estimate that Lianmao's copper foil substrate prices will rise by another 15 to 20% in the fourth quarter. Coupled with the increase in utilization rate, profits are expected to grow significantly.

Tenghui's cumulative consolidated revenue for the first nine months of this year was 5.352 billion yuan, an annual increase of 69.47%. Tenghui said that with the gradual upgrade of products and applications, the continuous introduction of new customers, the rapid increase in the volume of new products, and the benefits of product price increases, the revenue scale is expected to continue to grow month by month and quarter by quarter. A new high is expected throughout the year, and the subsequent operating outlook continues to be promising.

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