Sinolink Securities Co., Ltd. released a research report stating that against the backdrop of rapidly surging AI demand, the PCB and optical fiber industry chains are expected to experience structural high growth. The report suggests focusing on opportunities where demand transmits to upstream materials, favoring companies in the PCB chemicals sector with scale and technological advantages, as well as enterprises in the silicon tetrachloride industry possessing high-purity product capacity. The main views of Sinolink Securities are as follows:
The accelerated implementation of AI applications enhances the certainty of demand transmission to the upstream materials industry chain. With the explosive growth of the AI industry and the large-scale construction of computing power infrastructure, the PCB and optical fiber industry chains are poised for structural high growth. AI servers impose higher requirements on data processing speed, signal transmission quality, and system integration, directly driving the evolution of PCBs towards high-layer counts, high-density interconnect (HDI), and other high-end directions. Concurrently, as computing power chips continue to upgrade, the requirements for PCB layer counts and performance increase correspondingly, further expanding the industry's growth potential. Against the backdrop of accelerated global computing power infrastructure construction, the optical fiber industry's prosperity is significantly recovering. Data center network architectures are shifting from traditional converged designs to non-blocking architectures, demanding far greater quantities and specifications of optical fiber than traditional telecom networks. Simultaneously, requirements for transmission performance and stability of products like ultra-low loss fiber, specialty fibers, and preform materials have increased notably, presenting the optical fiber materials market with dual development opportunities: growth in demand scale and product structure upgrades.
The PCB chemicals market continues to grow in size with high technical barriers, and domestic substitution is expected to progress steadily. PCB chemicals are widely used in numerous key processes of PCB production, such as pre-treatment, etching, browning, chemical copper plating, and chemical nickel-gold plating. They can be categorized based on their application in PCB manufacturing processes into specialized chemicals for horizontal copper plating, chemical nickel-gold, electroplating copper, etching solutions, and inks. PCB chemicals are high-tech products combining electronic materials and fine chemicals, featuring significant technical barriers. Influenced by global industrial transfer and the expansion of China's PCB industry, China has gradually become one of the world's major producers of PCB chemicals. According to data from Hua Jing Industrial Research Institute, the global PCB chemicals market reached 50 billion yuan in 2024, with a CAGR of approximately 7.4% from 2020 to 2024. The high-end PCB chemicals market has long been dominated by brands from Europe, America, and Japan. As domestic enterprises increasingly prioritize the localization of core raw materials in the upstream supply chain, domestic PCB chemical companies are presented with favorable development opportunities.
Capacity expansion by optical fiber enterprises drives raw material demand; upstream raw material silicon tetrachloride prices are expected to recover from bottom levels. Driven by demand expansion and high product prices in the optical fiber and cable industry, global companies have begun actively expanding production. Overseas, Corning plans to increase its U.S. optical connectivity product capacity tenfold and its U.S. optical fiber capacity by over 50% to meet demand from AI factory construction. Domestically, several companies are also advancing related capacity expansion plans. As optical fiber and preform expansion projects gradually materialize, upstream raw material demand is expected to be significantly stimulated. Silicon tetrachloride is one of the main raw materials for producing optical fiber preforms. The consumption of high-purity silicon tetrachloride per unit in optical fiber preform production is approximately 6.5 tons. Producers of high-purity silicon tetrachloride mainly include companies with their own optical fiber preform supply, polysilicon manufacturers, and other new materials enterprises. Silicon tetrachloride prices have been declining since 2023. According to Bai Chuan Ying Fu data, the current market price for 9N silicon tetrachloride in Central China is 5,500 yuan per ton, while the price for standard-grade silicon tetrachloride in East China is 3,000 yuan per ton. Current silicon tetrachloride prices are at historical lows. Future marginal improvements in industry supply and demand may drive product prices upward.
Risk warnings include: downstream demand falling short of expectations; slower-than-expected AI adoption; significant fluctuations in raw material prices; intensifying industry competition; slower-than-expected progress in new material R&D and domestic substitution; delays in new project construction and product verification; lower-than-expected downstream capital expenditures; risks associated with new technology iteration.
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