Guotai Haitong: Fold machine titanium content increase, supply chain expected to benefit.

Guotai Haitong has released a research report stating that Apple's first foldable screen product is expected to be released in 2026. Apple will showcase ultimate industrial design aesthetics, no creases/ultra-thin/lightweight/durable features, and the future shipment volume is expected to increase rapidly year by year. Due to its high strength, high corrosion resistance, and good surface texture, the use of titanium and titanium alloys in foldable screens is expected to significantly increase. In terms of titanium materials, TIANGONG INT'L (00826) (a subsidiary of TGGF) has been deeply involved in high-end titanium alloy wire rods and has currently supplied to several international leading consumer electronics companies while continuously expanding its production capacity, with future prospects of benefiting from the high volume of foldable machines from major clients. Key Points from Guotai Haitong: Apple foldable machine "titanium content" increase, supply chain will benefit from explosive sales Apple's first foldable screen product is expected to be released in 2026. Apple will showcase ultimate industrial design aesthetics, no creases/ultra-thin/lightweight/durable features, and the future shipment volume is expected to increase rapidly year by year. The use of titanium and titanium alloys in foldable screens is expected to significantly increase due to their high strength, high corrosion resistance, and good surface texture. Middle Frame: After the foldable screen phone unfolds, it has a larger size, while also pursuing extreme thinness, making the body prone to bending and deformation. Therefore, the middle frame material must provide enough structural support while minimizing weight. Titanium alloy middle frames have significantly better bending resistance than aluminum alloys while achieving lightweight construction, providing better protection for the screen and internal components. Compared to straight phones, foldable phones have larger middle frames, thus increasing the value of titanium alloy usage. Screen Substrate: The screen substrate is located beneath the flexible OLED screen to support the screen to ensure display effects and touch experiences, and guide the screen to bend at a specific angle during folding and unfolding to reduce crease depth and visual impact. In order to reduce the weight of the device, Apple's foldable machine screen substrate is expected to adopt a pure titanium solution to balance weight, performance, and processing costs. Other: Due to the better toughness and corrosion resistance of titanium alloys, they are expected to be used in foldable screen hinge covers and other components in the future. With the maturity of 3D printing and other processing technologies, the penetration rate of titanium alloys in consumer electronics, aerospace, and other fields is expected to increase. 3D printed titanium alloys provide high design freedom, allowing for the manufacture of complex hollow or integrated structures that CNC machining cannot achieve (such as hollow legs for AR glasses, and biomimetic structural skeletons), with a material utilization rate close to 100%. However, efficiency is low and costs are high, currently being gradually applied in aerospace, medical fields, and transitioning to high-end consumer electronic products. In the future, with the maturity of 3D printing and other processing technologies, titanium alloys are expected to rapidly penetrate products such as foldable machines, AR/VR headsets, drones, which have extreme requirements for lightweight construction and structural strength. Domestic companies are actively expanding, with continuous increases expected in the future. In terms of the titanium and titanium alloy industry chain composition: upstream involves preparing titanium sponge from titanium ore; midstream involves melting the titanium sponge into ingots and processing them into titanium materials (plates, pipes, wire rods, etc.), and processing the titanium materials into titanium alloy structural parts using forming processes; downstream involves applications in industries such as chemical, aerospace, consumer electronics, etc. In the titanium materials sector, TIANGONG INT'L (a subsidiary of TGGF) has been focusing on high-end titanium alloy wire rods, currently supplying to several international leading consumer electronics companies while continuously expanding production capacity, with future prospects of benefiting from the high volume of foldable machines from major clients. Investment Recommendations: The use of titanium alloys in high-end consumer electronics products represented by Apple's foldable machines is expected to continue to increase, and the penetration rate of titanium alloys in various fields is also expected to grow with the maturity of 3D printing and other processing technologies. Currently, domestic companies are actively expanding, with continuous increases expected in the future. Relevant targets: TIANGONG INT'L (00826), Foxconn Industrial Internet (601138.SH), BYD ELECTRONIC (00285), J.Pond Precision Technology (301326.SZ). Risk Warnings: Uncertainty in US-China trade friction; Delay in the release of foldable screens.