PCB News - Automotive electronic PCB market has become a new blue ocean

The automotive electronics market has become a new blue ocean for the PCB group
The automotive electronics market has become a new blue ocean for the printed circuit board(PCB) group. Morgan Stanley Securities pointed out that Tripod (3044), one of the PCB group, has successfully cut into automotive electronic carrier boards. Its automotive PCB will achieve a 25% compound annual growth rate in the next three years, driving the profit trend upward. The net profit per share after tax (EPS) will continue to rise to RMB 6.42, 6.93 in the following year.

Morgan Stanley Technology Industry Analyst Shi Xiaojuan said that Tripod’s market share in automotive PCBs and server PCBs has gradually increased, and profits will increase by 8% to 17% in the next two years, which is derived from automotive PCB revenue. It also doubled from 6% in 2011 to 12% in 2013. Therefore, Tripod’s investment rating of “outperform” remains unchanged, and the target price of RMB 76.8 is maintained.

Although compared with Taiwan’s leading automotive PCB manufacturer Jingpeng’s 70%, Tripod’s automotive PCB still has a lot of room for improvement. Shi Xiaojuan believes that it has become a trend to shift the automotive component-related product supply chain to Asia. Related automotive PCB manufacturers, There is room for long-term benefits.

Morgan Stanley Securities estimates that in 2014, Tripod’s share price-to-net value ratio was 1.2 times, its P/E ratio was 9.9 times, and its return on equity (ROE) was 13.2%, making it more attractive than Jingpeng.

The leading manufacturer Jingpeng has an operating profit rate of as high as 10% for automotive PCBs and has the advantage of having more customers from large manufacturers.

Some Taiwanese manufacturers are actively cutting into automotive PCBs. It is precisely in view of the weakening of the growth momentum of smart phones that if PCB manufacturers rely too much on the smart phone business, and the notebook (NB) and PC industries continue to be weak, future profitable growth Fear of being greatly eroded.

Taking Xinxing as an example, Su Zhiping, a technology industry analyst at Merrill Lynch, said that high-end smartphones have weakened growth, which will have an impact on both the HDI version and the chip-size flip-chip package carrier (FC-CSP). In this case, Xinxing In the third quarter, sales of any tier of HDI version will slow down, coupled with the decline in FC-CSP market share, the estimated net profit per share of Xinxing this year will be reduced to 2.1 yuan, maintaining the "sell" investment rating.
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