Zhen Ding Begins Volume Production of AI PCBs as Capacity Expansion Extends Through 2030
Zhen Ding Technology (4958.TW) provided several positive updates at its 2Q26 earnings briefing.
Zhen Ding Technology (4958.TW) provided several positive updates at its 2Q26 earnings briefing. Its AI PCB products for GPU and ASIC customers, including HDI and multilayer boards, have entered mass production and are expected to begin ramping in 2H26.
The company is developing second- and third-generation products with 30-50 and 70-80 layers, compared with 20-30 layers for mainstream AI PCBs today. It plans capital expenditures of about NT$80 billion in 2026 and has extended its capacity-expansion timeline through 2030. Thirteen plants are under construction and 16 more are in the planning stage, while order visibility extends through 2029.
Zhen Ding raised its target for revenue from high-margin businesses—including IC substrates, AI servers and optical communications—to 45%-50% of total revenue by 2030. Its optical-communications business is being driven by 1.6T products. Yield at the company's Thailand plant is above 90%, and the company aims to become the largest supplier of optical-module PCBs in 2027.
The broker said the stock's 2028E P/E of just 8 times does not fully reflect the expected earnings growth from the AI PCB volume ramp.
Potential catalysts identified in the note include the ramp-up of mainstream AI projects in 2H26; progress in developing the second- and third-generation products with 30-50 and 70-80 layers; the company's goal of becoming the largest optical-module PCB supplier in 2027; and confirmation of the quarterly EPS ramp, with estimates of NT$4.09 for 9/26E and NT$5.90 for 12/26E.
The note identifies Zhen Ding as a direct beneficiary, citing 88.8% upside, and also points to the AI PCB and advanced HDI multilayer-board supply chain and optical-module PCB suppliers as potential beneficiaries. It says the market has not fully priced in the opportunity.
The company is developing second- and third-generation products with 30-50 and 70-80 layers, compared with 20-30 layers for mainstream AI PCBs today. It plans capital expenditures of about NT$80 billion in 2026 and has extended its capacity-expansion timeline through 2030. Thirteen plants are under construction and 16 more are in the planning stage, while order visibility extends through 2029.
Zhen Ding raised its target for revenue from high-margin businesses—including IC substrates, AI servers and optical communications—to 45%-50% of total revenue by 2030. Its optical-communications business is being driven by 1.6T products. Yield at the company's Thailand plant is above 90%, and the company aims to become the largest supplier of optical-module PCBs in 2027.
The broker said the stock's 2028E P/E of just 8 times does not fully reflect the expected earnings growth from the AI PCB volume ramp.
Potential catalysts identified in the note include the ramp-up of mainstream AI projects in 2H26; progress in developing the second- and third-generation products with 30-50 and 70-80 layers; the company's goal of becoming the largest optical-module PCB supplier in 2027; and confirmation of the quarterly EPS ramp, with estimates of NT$4.09 for 9/26E and NT$5.90 for 12/26E.
The note identifies Zhen Ding as a direct beneficiary, citing 88.8% upside, and also points to the AI PCB and advanced HDI multilayer-board supply chain and optical-module PCB suppliers as potential beneficiaries. It says the market has not fully priced in the opportunity.