Impacted by the possibility that the FCC (U.S. Federal Communications Commission) may introduce restrictive policies, A-share optical module stocks have recently come under considerable pressure, with shares of companies such as Eoptolink and Dongshan Precision continuing to decline.
This article first focuses on Eoptolink's smaller peer, Suzhou TFC Optical Communication Co.,Ltd. (300394), because it recently released its investor relations activity record; other companies will be analyzed in detail later.
Regarding whether the recently rumored overseas import and export policy restrictions affect the company, Suzhou TFC Optical Communication said this weekend that its main business is the research, development, production and sales of various passive optical components and active optical components. The policies currently issued do not restrict optical component products and do not involve any impact on the company's business.
Second, its sales proportion in the U.S. market is relatively low, with revenue from North America accounting for about 1.28% of the company's sales in 2025.
At the same time, the company stressed that it is optimistic about the development prospects of the optical interconnect industry, especially the continued growth opportunities in directions such as CPO/NPO. However, it acknowledged that due to the supply impact of some bottleneck materials, the company's phased capacity release and delivery pace are subject to certain constraints.
So let us analyze the company's current share price and fundamentals.
As of the close on October 9, 2026, Suzhou TFC Optical Communication Co.,Ltd. (300394) traded at 235.04 yuan, with a dynamic price-to-earnings ratio of 106.4 times, a dynamic price-to-book ratio of 44.96 times, a total market value of 256.4 billion yuan, a turnover rate of 2.96% that day, and an amplitude of 5.99%.
Based on 2025 net profit attributable to the parent company of 2.017 billion yuan, the total market value is about 127 times profit.
As a victim of U.S. restrictive policies, Sungrow Power Supply traded at 80.68 yuan in the same period, with a dynamic price-to-earnings ratio of 15.9 times, a dynamic price-to-book ratio of 3.43 times, and a total market value of 167.3 billion yuan.
Suzhou TFC Optical Communication's profit is less than half of Sungrow Power Supply's, yet its market value is about 89 billion yuan higher.
Next, look at whether Suzhou TFC Optical Communication's profit growth matches its valuation.
The company's 2025 revenue was 5.163 billion yuan, up 58.79% year on year; net profit attributable to the parent company was 2.017 billion yuan, up 50.15% year on year.
In the first half of 2026, revenue was 2.828 billion yuan, up 15.15% year on year; net profit attributable to the parent company was 1.204 billion yuan, up 33.92% year on year.
Revenue growth plunged from 58.79% to 15.15%, while the 106x PE corresponds to the assumption of sustained high growth over the next several years.
As of September 30, 2026, 24 institutions had made forecasts for Suzhou TFC Optical Communication's 2026 performance, with average forecast net profit of 3.588 billion yuan, up 77.86% year on year.
Among them, the most optimistic was Tianfeng Securities, which forecast profit of 4.027 billion yuan, still implying a PE of more than 63 times; based on a median of about 3.54 billion yuan, the PE is about 72 times.
Suzhou TFC Optical Communication's business structure changed significantly in the first half of 2026.
Active optical components achieved operating revenue of 1.260 billion yuan, down 19.57% year on year, with a gross margin of 47.03%, up 3.67 percentage points year on year; passive optical components achieved operating revenue of 1.530 billion yuan, up 77.40% year on year, with a gross margin of 71.90%, up 8.33 percentage points year on year.
The revenue share of active optical components shrank from 58.06% for all of 2025 to 44.55% in the first half of 2026, while the share of passive optical components rose from 40.37% to 54.11%.
It is understood that the core reason for the year-on-year decline in Suzhou TFC Optical Communication's active optical component revenue was material bottlenecks.
At its investor relations activity on October 9, 2026, the company said, "In the first half of 2026, affected by the tight supply of some bottleneck materials, the company's phased capacity release and delivery pace were subject to certain constraints, which in turn had a certain impact on the performance growth of active optical components. At present, the tight supply of relevant key materials has eased significantly compared with earlier periods."
Earlier, in August 2026, the company also said on its interactive platform that "since the third quarter of 2026, the shortage of relevant materials has gradually eased, and the overall supply situation is showing a trend of improvement."
Easing does not mean the problem has been eliminated.
The material bottleneck has substantially dragged down the pace of revenue recognition.
Whether the deferred active optical component revenue from the first half of 2026 can be recognized in a concentrated manner in the second half is a key variable for whether full-year performance can meet institutional expectations.
It is worth noting Suzhou TFC Optical Communication's customer concentration problem.
Suzhou TFC Optical Communication's sales to its largest customer, Fabrinet, reached 3.269 billion yuan, accounting for 63.31% of total revenue, further up from 61.69% in 2024.
Over the past three years, the revenue contribution ratios were 53.61%, 61.69% and 63.31%, respectively.
The dependence has shown a continuously rising trend.
Fabrinet is a global leader in optical packaging and precision manufacturing listed on the U.S. stock market, with major customers including Cisco, Lumentum and Nvidia.
This fully exposes Suzhou TFC Optical Communication's vulnerability: once Fabrinet's end customers adjust procurement strategies or supply chain architecture, Suzhou TFC Optical Communication could instantly find itself in a passive position.
Suzhou TFC Optical Communication claims that overseas restrictive policies do not involve its products, but this may nonetheless be a sharp sword hanging overhead.
The case of Sungrow Power Supply provides an important reference.
On May 27, 2026, Sungrow Power Supply's share price hit a high of 191.71 yuan. After that, it went through three waves of declines and closed at 80.68 yuan on October 9, a cumulative drop of more than 50%.
Sungrow Power Supply's fundamentals were not poor—its "safe harbor" policy under the U.S. IRA framework clearly supports orders for 2027 and before, U.S. domestic inverter brands hold only about 10% market share, and building a complete industrial chain would take at least five years.
However, the market did not stop falling because of the relative resilience of the fundamentals, but instead traded the most pessimistic expectations for policy uncertainty in advance.
Of course, there are clear differences between them.
Sungrow Power Supply has large revenue exposure to the U.S. market, while Suzhou TFC Optical Communication's sales revenue from North America accounts for only about 1.28%.
From the perspective of direct revenue exposure, Suzhou TFC Optical Communication's risk is indeed far smaller than Sungrow Power Supply's.
But this does not mean the risk can simply be ruled out.
Suzhou TFC Optical Communication's indirect exposure is more hidden—the company indirectly reaches North American end customers through Fabrinet, which accounts for 63.31% of revenue.
Fabrinet's production base in Thailand packages Suzhou TFC Optical Communication's optical components into optical modules and then supplies them to North American end customers.
This indirect chain remains within the transmission chain of the North American computing power supply chain.
Based on previous experience, A-share investors may often experience policy panic.
What the market is trading is the "expectation of future supply chain adjustments," rather than already implemented sanctions targeting optical components.
At present, the FCC has not issued formal rules restricting China's optical module exports to the United States, and whether optical components, especially passive components, fall within the scope of "logical-bearing hardware components" under FCC rules has not yet been officially clarified.
But this is, after all, a potential risk.
The author believes that Suzhou TFC Optical Communication may currently face a superposition of three risks.
The first risk, already occurring: the material bottleneck has substantially dragged down the revenue recognition pace in Q4 2025 and the first half of 2026, with active optical component revenue falling 19.57% year on year and revenue growth plunging from 58.79% to 15.15%.
The second risk, ongoing: the 63.31% single-customer concentration leaves the company lacking depth in industrial chain bargaining, and any supply chain adjustment by Fabrinet will directly hit Suzhou TFC Optical Communication.
Its overseas revenue accounts for more than 70%, and the indirect exposure cannot be ignored.
The third risk, potentially superimposed: the volume ramp expectations for CPO/NPO in 2027-2028 highly overlap with the possible impact window of FCC Rule 26-50.
Although Suzhou TFC Optical Communication's direct sales share in North America is only 1.28%, the indirect chain it has built through Fabrinet faces uncertainty over the scope of "logical-bearing hardware components" under the rules.
FCC rules explicitly exclude "purely mechanical or passive components," but whether active components among optical components touch the definition boundary of "logical-bearing hardware components" has no official interpretation yet.
The lesson from Sungrow Power Supply is that from the emergence of rumors to the confirmation of news, the share price went through three waves of declines and continued to hit new lows, with the market trading the most pessimistic expectations in advance even while fundamentals still had support.
Suzhou TFC Optical Communication's 106x PE implies perfect expectations, and any signal below expectations could trigger a major valuation correction. In terms of share price trend, it has also broken below the 60-day moving average again.
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