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PCB-specific electronic chemicals are core materials for printed circuit board manufacturing, possessing high barriers to entry.The PCB manufacturing process involves many steps, and electronic chemicals must be used in multiple process stages. High-quality PCB-specific electronic chemicals are essential for producing high-end PCBs.The PCB-specific electronic chemicals field has high entry barriers: 1) From a technical perspective, as high-frequency and high-speed substrates, high-layer through holes, and multi-step blind holes become more complex, the compatibility, wettability, and process adaptability of specialized chemicals face stricter requirements; 2) From a customer perspective, the certification system for end customers is strict, lengthy, and has high thresholds, with costs accounting for a low proportion of downstream manufacturers’ expenses. Once certified, strong customer loyalty is formed.
Currently, foreign manufacturers dominate the high-end market, but manufacturers from mainland China are gradually breaking the monopoly. The main processes involving the use of specialized electronic chemicals in PCB manufacturing include hole metallization, electroplating, and surface treatment. Most of the specialized electronic chemicals used for circuit patterns have the lowest technical level and are mainly supplied by manufacturers from mainland China; the specialized electronic chemicals used for copper surface treatment and final surface treatment are next; the specialized electronic chemicals used for hole metallization and electroplating processes have a higher technical level, currently dominated by foreign manufacturers, but manufacturers from mainland China are gradually breaking the monopoly in the high-end market.
A great era brings great opportunities, from PCBs to the broader semiconductor field, application scenarios continue to expand. For PCB-specific electronic chemical manufacturers in mainland China, the strong factors supporting their endogenous growth mainly include: 1) Benefiting from the accelerated deployment of computing power infrastructure such as AI servers and intelligent computing centers, the global PCB market has shown a clear recovery trend. PCB-specific electronic chemicals from mainland China benefit from the global industrial recovery while also deeply benefiting from the continuous growth of the PCB industry in mainland China; 2) Under the great power competition, more opportunities for self-control arise, and manufacturers from mainland China are gradually penetrating the high-end PCB market; 3) Manufacturers from mainland China have also made breakthrough progress in the broader semiconductor field, continuously expanding the application scenarios for electronic specialty chemicals.
Benchmarking against overseas giants, from raw materials to one-stop comprehensive service providers. Overseas electronic chemical giants have completed the transformation from raw material suppliers to one-stop comprehensive service providers. Taking Amtech as an example, it not only produces and sells electroplating chemicals in the fields of PCBs and packaging substrates but also provides corresponding equipment and wet chemical process technologies. Manufacturers from mainland China are also showing signs of transforming into one-stop comprehensive service providers, mainly through: 1) Self-research to enter the equipment field, for example, Sanfu Xinke has independently developed two-step composite copper foil electroplating equipment; 2) Some companies may quickly enter the equipment field through extension, improving customer service efficiency and problem-solving capabilities.
The industry is entering a new AI-driven cycle, with fundamental changes in demand structure.The construction of AI server clusters brings synchronous upgrades of computing power boards, switches, and optical modules, driving both the demand and price of PCBs to rise.As the computing power architecture evolves from GPU servers to orthogonal and wireless cable structures, the signal chain becomes shorter and more sensitive to material losses, making PCBs one of the core interconnection and power supply carriers in AI hardware. This AI cycle differs from the “peak-fall” characteristics of the 5G cycle, presenting a long-cycle attribute of “technology iteration driving continuous penetration.” We believe that AI will become the dominant growth driver in the PCB industry over the next 3-5 years. We estimate that by 2027, the wired communication PCB market will reach 206.9 billion yuan, with a CAGR of 20% over the next two years.
The tight demand for high-end PCBs is expected to continue until 2027, with global manufacturers competing to expand production. In the past six months, several A-share listed PCB companies have announced new expansion plans, which are more aggressive than last year. Regionally, major PCB manufacturers are accelerating their layout in Southeast Asia, establishing new bases in Thailand and Vietnam to meet overseas customer demand while actively promoting the expansion of domestic high-end production capacity, forming a short-term layout where “domestic production capacity is responsible for high-end research and development, and overseas factories serve as entry tickets.” We have estimated the production capacity of 10 leading A-share PCB companies and 3 overseas PCB manufacturers, predicting that by 2027, the combined output value of these 13 companies will reach 186 billion yuan, with a CAGR of 54% from 2025 to 2027. According to our estimates, the global market will face a supply-demand gap of nearly 20 billion yuan for PCBs by 2026, and the supply-demand tension will continue in 2027, but the gap is expected to narrow.
Process iteration and material upgrades resonate, significantly accelerating the trend of industry high-endization. We have summarized several recent technological changes: the mSAP process is rapidly popularizing on AI server and switch motherboards to cope with line widths and spacings of 10-15μm; server cabinets will evolve towards pseudo-orthogonal architectures in the long term, further enhancing signal transmission density and imposing stricter requirements on low dielectric, low loss, and low roughness materials. In terms of material systems, electronic fabrics are evolving from E fabric to L/Q fabric, resin systems are upgrading towards low Dk/Df and high Tg, and copper foils are generally adopting HVLP3/4 and ultra-thin copper to reduce losses. We judge that future high-end boards will exhibit a three-in-one iterative feature of “materials-processes-architecture,” driven by AI architecture to push signal frequency upward, thereby driving continuous innovation in material systems and manufacturing processes, leading to differentiation in technology and profits among companies.
With surging demand and improved profitability, upstream materials for PCBs are entering a period of domestic substitution opportunities. Driven by upstream copper mine production cuts and expectations of a US interest rate cut cycle, copper prices have significantly risen since April, leading to a general increase in prices of mid-to-low-end products in copper-clad laminates. Due to a more favorable competitive landscape for copper-clad laminates compared to downstream PCB manufacturers, companies like Shenyin Technology and Jiantao Laminates have quickly realized cost transmission to downstream, restoring profitability; however, high-frequency and high-speed AI copper-clad laminates are limited by the bargaining power of end customers, leaving limited room for price increases in the short term. Meanwhile, materials involved in high-end copper-clad laminates, such as hydrocarbon resins, Low-DK second-generation fabrics/quartz fabrics, HVLP copper foils, and silicon micropowder, have seen sudden demand surges, with some products experiencing supply shortages, including a 10-20% gap for Low-DK second-generation fabrics, and prices have significantly risen in the past six months. Against a backdrop of limited supply, domestic manufacturers have made significant progress in the resin and silicon micropowder sectors, accelerating the localization of second-generation fabrics, and several companies are also laying out quartz fabrics, rapidly opening up the domestic substitution space for the high-end copper-clad laminate industry chain.
With the increase in rack density, PCBs are reshaping the high-density connection landscape. At GTC 2025, NVIDIA showcased the new Kyber rack structure concept, replacing backplane copper cables with PCBs, using a pseudo-orthogonal architecture to connect computing trays rotated 90° directly to the switch tray via PCB backplanes. Additionally, the Vera Rubin CPX released at the AIInfra Summit in September also used midplanes instead of overpasses to address challenges such as limited wiring space and low reliability in GB series assemblies. As midplanes undertake important signal transmission, their value is high. We expect that a fully equipped VRNVL144 CPX rack, with a single Vera Rubin GPU (excluding CPX), will correspond to a PCB value of 8000 yuan, and the NVL144 single GPU (excluding CPX) will also reach a value of over 5000 yuan, doubling the value compared to GB200/300.
Under the drive of the AI cycle, PCBs are in a long-term trend of simultaneous increases in quantity, price, and structure. Mid-to-low-end products improve profitability through cost transmission, while high-end products expand barriers through technological upgrades. In the next two years, the industry chain will enter a new phase of “technology-driven + regional rebalancing.” We recommend paying attention to leading companies with high-end manufacturing capabilities, overseas delivery layouts, and material synergy systems: Huadian Co., Jingwang Electronics, Shenyin Technology, Pengding Holdings, Dongshan Precision, Shiyun Circuit, and Aoshikang.
Risk Warning: AI computing power investment scale may fall short of expectations; PCB expansion pace may not meet expectations; AI server architecture upgrades may not meet expectations.