Tracking Hong Kong Stock Concepts | Tech Giants Trigger Data Center Construction Boom PCB Industry Continues to Improve (with Concept Stocks)

Tech giants are setting off a wave of data center construction. Among them, Amazon's cloud computing department, Amazon Web Services (AWS), plans to invest at least $11 billion in Georgia to expand its infrastructure and support various cloud computing and artificial intelligence technologies. Microsoft previously announced a spending of $80 billion on AI data centers by the 2025 fiscal year. Driven by this trend, the PCB industry is expected to continue to rise. Printed Circuit Board (PCB) is known for its manufacturing process using "electronic printing". Where there is electricity, there is a PCB, with its applications downstream covering many industries such as consumer electronics, PCs, communications, automotive electronics, and aerospace, earning PCB the nickname "mother of electronic products". According to CMSC, driven by AI technology and applications, servers will be the fastest-growing application area for PCBs, with a compound annual growth rate of 11.6% to $14.2 billion from 2023 to 2028. AI servers represented by the NVIDIA GB series will see a significant increase in demand for high-density interconnects (HDI), prompting a major upgrade in substrate specifications driven by the high-speed data transmission requirements. The PCB ASP of AI servers will grow several times that of ordinary types, with the GB200 model set to begin shipping at the end of the fourth quarter of 2024 and be delivered in large quantities next year. The penetration rate of new general server platforms (supporting PCIe 5.0) is rapidly increasing, and 800G switches will gradually become market mainstream next year, with the potential for a significant increase in single-machine ASP, driving demand for corresponding high-density and advanced HDI. In recent years, the continuous advancement of the AI industry chain has greatly promoted the development of the PCB industry, especially the recent wave of data center construction initiated by technology giants, leading to a further increase in the prosperity of the PCB industry. Related PCB industry chain Hong Kong stocks: KB LAMINATES (01888): In the PCB manufacturing process, it involves drilling, copper plating, printing, soldering, etc. of copper-clad laminates (CCL) to eventually form the circuit board. Open Source Securities previously pointed out that KB LAMINATES is a leader in the copper-clad laminate industry. With the rise in copper prices in 2024 and downstream demand gradually returning, copper-clad laminates have flexible pricing space. Additionally, vertical integration in the supply chain and cost advantages from economies of scale are expected to drive the company's revenue and profit back on a growth trajectory in 2024. KINGBOARD HLDG (00148): KINGBOARD HLDG is a global leader in copper-clad laminates and has a layout covering upstream raw materials and downstream the entire PCB industry chain. In the company's 2024 interim report, the group is vigorously building a copper-clad panel research and development center equipped with high-precision equipment. The group has successfully developed a variety of high-frequency high-speed products that can be used in the GPU motherboard of AI servers. In the future, the group will be able to comprehensively meet the product requirements of downstream customers and cooperate with high-quality customers, driving the endorsement of the group's products by end customers. FIT HON TENG (06088): FIT HON TENG, a subsidiary of Foxconn and NVIDIA, has close collaboration in the field of AI. With years of technological accumulation in the connector industry and lean manufacturing capabilities, the company is expected to enter the list of backplane connector suppliers through NVIDIA certification. China Securities Co., Ltd. previously pointed out that FIT HON TENG is a global leading manufacturer in the precision zero-component field, with Foxconn being the company's actual controller. The development of AI is driving the construction of computing infrastructure, and the connection system architecture is rapidly upgrading to higher speeds. FIT HON TENG's layout in high-speed connection systems covers areas such as copper connections and optical modules, with potential for significant benefits. With the expansion of business scale and continuous improvement in quality and efficiency, the company's profitability is expected to increase in the future.