At the request of many fans, I would like to compareDazhu CNC and Xinqi Microelectronics.Recently, I have analyzed the industry chain of PCB equipment in detail. In the wave of high-density, high-layer, and high-precision development in the PCB industry, the localization of equipment is undoubtedly the main theme. Dazhu CNC and Xinqi Microelectronics, as leaders in their respective segments, are often compared by investors.For example, it is easier for everyone to understand:Dazhu CNC is the “all-round aircraft carrier” covering the core processes of PCB, while Xinqi Microelectronics is the “cutting-edge surgical knife” focusing on the critical graphical stages.
Product Comparison:Dazhu CNC VS Xinqi Microelectronics
Dazhu CNC: The “All-Round King” of PCB Equipment
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Product Strength: Its product line covers almost all core equipment of thedry processexcept for the PCB dehumidification process, includingmechanical drilling machines (absolute leader),laser direct imaging equipment (LDI),laser forming machines,CO2/UV laser drilling machines,testing equipment, etc. The advantage lies in providing customers withone-stop, automated, and intelligent overall solutions.
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Market Share: Dominating themechanical drilling machine sector, with a leading global market share (about 40-50%). The market share of LDI equipment is second in the domestic market (only behind Xinqi Microelectronics), and other types of equipment also rank among the top in the domestic market. Its customers cover almost all mainstream PCB manufacturers in China, such as Shenzhen South Circuit, Huadian Co., and Jingwang Electronics.
Xinqi Microelectronics: The “Expert” in Direct Writing Lithography
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Product Strength: The company focuses onlaser direct imaging (LDI) equipment, which is the core technology in thegraphical stage of PCB manufacturing. Its products have broken through from the low-end PCB market and are now widely used inIC substrates,substrate-like (SLP),advanced packaging (AP), FPD (flat panel display) and other high-end fields. The technical path focuses on “direct writing lithography,” which does not require physical masks, showing significant advantages in precision, efficiency, and flexibility.
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Market Share: The absolute leader in the domesticLDI equipment market, maintaining the top position in the domestic market share, and is forming a strong alternative to international giants like Orbotech from Israel in the global market.
Dazhu excels in “breadth,” with its value lying in the synergy and platform capabilities of its product matrix, deeply binding with major customers, resonating with the overall capital expenditure of the PCB industry. Xinqi excels in “depth,” with its value in achieving breakthroughs and domestic replacements in the “graphical” stage, closely related to the expansion of high-precision PCB and semiconductor industries.
Financial, cyclical, growth, and gross margin comparisons:Dazhu CNC VS Xinqi Microelectronics
Dazhu CNC:
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Massive Scale: Revenue and net profit scale far exceed that of Xinqi Microelectronics (Dazhu CNC’s annual revenue is about 3 billion, while Xinqi Microelectronics is about 1 billion (referring to 2024 data, 2025 data should exceed the same period level).
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Significant Cyclicality: Its business is highly tied to the prosperity of the PCB industry. During industry downturns (such as 2022-2023), performance is significantly pressured as PCB manufacturers delay all capital expenditures on equipment. Net profit margin is affected by scale effects and product structure.
Xinqi Microelectronics:
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High Growth: In recent years, revenue and profit have maintained rapid growth, even during industry downturns, as its products are in the accelerated penetration phase of domestic replacement, with growth rates significantly higher than the industry average.
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High Gross Margin: Due to the high technical content of its LDI equipment and favorable competitive landscape, gross margin has consistently maintained around 50%, significantly higher than Dazhu CNC’s overall gross margin (about 35%), reflecting its strong product pricing power and technical barriers.
Dazhu CNC is a “cyclical growth stock,” and its performance is a “barometer” of the PCB industry. Xinqi Microelectronics is a “high-growth stock,” and its performance is a “scale of domestic replacement penetration.” The former is more dependent on external factors (industry β), while the latter has stronger intrinsic alpha (α) attributes.
Personal Opinions and Views: Dazhu CNC VS Xinqi MicroelectronicsAbove is a comparison of the two companies regarding product strength, competitiveness, and financial situation. Of course, “individualistic” fans may ask me: “You mentioned so much, if you had to choose, which one would you pick?”This is a great question. If I must choose one based on my personal investment style (favoring growth and technical barriers, able to withstand higher volatility), I would choose: Xinqi Microelectronics. Of course, this does not mean Dazhu is bad; I must clarify that my opinion does not constitute investment advice, it is purely personal.Dazhu CNC‘s business is the“cornerstone” of PCB manufacturing. Without drilling, exposure, and testing, PCB production cannot occur. This is a “β” driven logic (closely related to industry development). Dazhu CNC’s moat lies in scale, platformization, and customer relationships. Its competition mainly comes from other large equipment manufacturers (such as Dongwei Technology) and competitors from Taiwan, focusing more on cost, stability, and service.Xinqi Microelectronics‘s LDI equipment directly determines the precision of the lines and is akey bottleneck device for moving towards higher-end manufacturing. Its development benefits not only from industry investment but also fromthe acceleration of technological iteration and domestic replacement. This is an “α” driven logic. It has almost no competitors in the domestic LDI market, and its goal is to directly benchmark and replace global giants like Orbotech from Israel. Its moat is simple: pure technology and hard science.I always believe that a moat built on core technology is more enduring and profound than one built on scale and cost.Finally, looking at valuations, Dazhu’s revenue for the first half of 2025 is nearly 2.4 billion, with a net profit of about 260 million, a year-on-year increase of over 80%. It is expected that the annual net profit will reach around 550 million. Currently, Dazhu’s total market value is about 44 billion, corresponding to a price-to-earnings ratio of about 80 times.Looking at the 80 times price-to-earnings ratio, it does seem relatively expensive, but if strictly following the textbook formula, an 80% growth rate corresponds to a price-to-earnings ratio of 80 times, which is actually quite reasonable. The key is whether this 80% growth rate can be sustained (Dazhu’s growth rates in the first and second quarters are both 80%).Xinqi Microelectronics’ revenue for the first half of 2025 is nearly 650 million, with a profit of 140 million (revenue about 1/3 of Dazhu’s, profit about 1/2 of Dazhu’s), a year-on-year increase of over 40%, and an overall net profit of around 300 million. Currently, Xinqi Microelectronics is valued at about 20 billion, corresponding to a price-to-earnings ratio of about 60-70 times. At first glance, it seems that the market gives Dazhu a higher price-to-earnings ratio, but it is not necessarily the case. Dazhu’s 80% growth corresponds to an 80 times price-to-earnings ratio, whileXinqi Microelectronics (with growth rates of 30-40% in the first and second quarters) is given a price-to-earnings ratio of about 60-70 times, which is directly doubled. Therefore, the market is also more inclined towards Xinqi Microelectronics, thus giving it a higher valuation.So, it is simple from here: it depends on the profit growth rate in the third quarter and for the year. If Dazhu continues to maintain an 80% or even 100% growth rate, then it can be confidently invested in; if Xinqi Microelectronics can achieve a profit growth rate of 50-60% in the third quarter and for the year, then the market may give it a higher price-to-earnings ratio. Currently, the market still prefers hard technology and hard science, as these developments represent the advancement of China’s technological strength.This is my opinion! Everyone can just enjoy the discussion; it does not constitute investment advice, nor does it have any clear bias. It is simply a discussion of my views, which may not necessarily be right or wrong, so please consider carefully.Finally,if you are interested, feel free to follow me, and we can exchange and learn anytime!Once again, I wish everyone prosperity.Follow me to focus on the development of the technology industry and explore the technology industry in China!