China's PCB Suppliers Ride AI Boom with IPOs
Companies supplying critical components for AI infrastructure are capitalizing on surging global demand through stock market listings.
Quick Look
- Chinese printed circuit board (PCB) suppliers are experiencing a surge in interest and pursuing IPOs, driven by the booming global demand for AI infrastructure.
- Companies like Victory Giant Technology and Jiangxi Redboard Technology are raising significant capital, with analysts projecting continued growth in the sector.
AI-generated summary
Why It Matters
Printed circuit boards (PCBs) are fundamental components in all electronic devices, providing the physical structure and electrical connections for components. Their importance has grown significantly with the rise of advanced AI infrastructure, which requires complex interconnects for servers and data centers.
Printed circuit boards (PCBs) – unsung core components in all electronic devices – are emerging as the latest source of excitement in China’s chip supply chain, as domestic companies capitalise on surging global demand for artificial intelligence infrastructure to pursue share listings.
Victory Giant Technology, a PCB supplier to US chip champion Nvidia, kicked off bookbuilding in Hong Kong on Monday for an initial public offering (IPO) that aims to raise up to HK$17.49 billion (US$2.2 billion).
The plan testifies that the blistering expansion of AI infrastructure has created a gold rush for high-end circuit boards, with analysts projecting growth beyond 2026.
Often thought of as unsophisticated components – if they are thought of at all – PCBs have taken on more importance because they play an essential role in the complex interconnect that is crucial for advanced AI servers and data centre switches.
Jiangxi Redboard Technology, another domestic PCB supplier, listed in Shanghai last week, raising 1.8 billion yuan (US$263.4 million) for capacity expansion. Another mainland supplier to Nvidia, Zhongji Innolight, was reported in early April to have submitted a confidential application to list in Hong Kong, aiming to raise at least US$3 billion.
“PCBs are currently all the rage across the world due to the rapid expansion of AI data centres,” said Kenny Ng Lai-yin, a strategist at Everbright Securities International. “Given the shortage of supply, the momentum of the sector is expected to maintain for one to two years.”
What to Watch
AI outlook — possibilities, not facts
Further IPOs or significant funding rounds from other PCB suppliers will occur in the near future.
Likely · Within months
Increased investment in PCB manufacturing capacity globally, not just in China, to meet AI demand.
Possible · Within months
Potential for supply chain bottlenecks or price increases if demand continues to outstrip supply.
Possible · Short term
Open Questions
- What is the specific capacity expansion planned by Jiangxi Redboard Technology?
- What is the exact valuation target for Zhongji Innolight's IPO?
- What are the specific risks associated with the PCB supply chain for AI infrastructure?
