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BackFocus Stocks》Lianmao: Foreign investors admitted their mistake in underestimating the price increase and named the next golden stock
Focus Stocks》Lianmao: Foreign investors admitted their mistake in underestimating the price increase and named the next golden stock
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自由时报1 hour agoBusiness2 min readChinaView original

Focus Stocks》Lianmao: Foreign investors admitted their mistake in underestimating the price increase and named the next golden stock

LianmaoCopper foil substrateJapanese foreign capital

Quick Look

  • Japanese foreign investors have raised Lianmao's target price from 600 yuan to 1,110 yuan due to rising copper foil substrate prices and an increase in the proportion of high-end products.
  • They predict that its product prices will increase by about 30% and 20% in the third and fourth quarters, respectively, and its gross profit margin will increase to about 35%.

AI-generated summary

Why It Matters

Lianmao is a copper foil substrate manufacturer. Benefiting from product price increases and an increased proportion of high-end products, its profits have jumped significantly this year.

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Japanese foreign investors raised the target price of Lianmao to 1,110 yuan. (Photo by reporter Zhuo Yijun)

[Reporter Zhuo Yijun/Taipei Report] Copper foil substrate (CCL) factory Lianmao (6213) has experienced a sharp jump in profits this year due to rising copper foil substrate prices and an increase in the proportion of high-end products. The latest report issued by Japanese foreign investors pointed out that Lianmao’s second-quarter financial results were significantly better than expected, and the outlook continues to change. Shanzhong, which had previously underestimated the extent and sustainability of price increases for electronic-grade glass fiber cloth (E-glass) and copper foil substrates below M4 grade, raised Lianmao's profit forecast to reflect better-than-expected product prices and gross profit margin performance, and raised the target price from 600 yuan to 1,110 yuan.

Lianmao is currently conducting two-minute split trading. As of about 9:12 today, Lianmao's stock price fell 5.96%, temporarily trading at 805 yuan, with a trading volume of approximately 910 contracts.

Please read on...

According to Japanese foreign investment analysis, this week Japan's large copper foil substrate manufacturers will increase the price of entry-level CCL products by 200% to catch up with the price increases of global peers. Chinese peers have also continued to increase the average selling price (ASP) by about 10% every month. It is expected that It is estimated that Lianmao's product prices will increase by approximately 30% and 20% in the third and fourth quarters, respectively, higher than the previous estimates of 20% and 10%. It is expected that there will still be room for price increases of approximately 10% per quarter in the first half of 2027, with a cumulative increase of approximately 20%.

Japanese foreign investors pointed out that Lianmao's gross profit margin will further increase to approximately 35% in the fourth quarter. Considering that Lianmao will maintain a disciplined capacity expansion strategy until 2028, it is expected that the higher gross profit margin level is expected to continue until 2028. In addition to product price increases, Lianmao's mid- to long-term growth momentum also includes the rebound in demand for general servers in 2027, as well as the adoption of M7 level CCL on new platforms and more customers completing M9 level CCL certification.

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What to Watch

AI outlook — possibilities, not facts

  • Lianmao’s product prices will increase by about 30% in the third quarter

    Likely · Within months

  • Lianmao's gross profit margin will increase to approximately 35% in the fourth quarter

    Likely · Within months

Open Questions

  • What is the progress of Lianmao's production capacity expansion?
  • What will be the market adoption rate of M7 grade and M9 grade CCL?

Related Topics

Lianmao
PeopleZhuo Yijun
OrganizationsJapanese foreign capital
PlacesTaipei
TopicsCopper foil substrateJapanese foreign capitaltarget priceGross profit marginProduct price increaseM7 grade
This article was originally published by 自由时报.

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