New shares Outlook | Leveraging the industrial momentum Chaozhou Three-Circle(Group) (300408.SZ) is entering the harvest period. How much growth dividend can the "A+H" layout still leverage?

In recent years, the global market for advanced electronic ceramic materials and components is undergoing a high prosperity cycle driven by the upgrade resonance in multiple key areas of the national economy, such as AI and data centers, automotive electronics, semiconductor manufacturing, and packaging. Take MLCC (Multilayer Ceramic Chip Capacitors), known as the "rice of the electronics industry," for example. With the background of the single-vehicle usage of new energy vehicles increasing several times that of traditional fuel vehicles and the surge in demand for high-capacity and high-voltage products from AI servers, the prosperity continues to rise. In the wave of booming industry, Chaozhou Three-Circle (Group) (300408.SZ) has experienced a rare value revaluation market in the past five months. GMTEight has noticed that Chaozhou Three-Circle (Group) stock price reached a high of 144 yuan this year, with a maximum increase of over 210% since the beginning of the year at this price. It is worth noting that the surge in Chaozhou Three-Circle (Group) stock price is not only supported by the tight supply of MLCC products but also by the fact that its optical communication devices are also in their respective prosperity cycles. Multiple favorable factors resonate and jointly boost the stock price of Chaozhou Three-Circle (Group). Riding the industry boom, Chaozhou Three-Circle (Group) is also taking advantage of the momentum to apply for a dual listing on the Hong Kong Stock Exchange. Can Chaozhou Three-Circle (Group) fulfill its dream of listing on the Hong Kong Stock Exchange? Under the industry boom, is the diversified product layout entering the harvest period? Chaozhou Three-Circle (Group) can trace its history back to the establishment of Chaozhou Radio Components Factory in 1970, initially engaged in the production of ceramic substrates and fixed resistors. Starting as a small local factory, the company transitioned into a joint-stock company in 1992, and successfully listed on the ChiNext of the Shenzhen Stock Exchange in December 2014. As of now, Chaozhou Three-Circle (Group) has built a strategic direction around "material + structure + function," forming four major product matrices including electronic and ceramic materials, electronic components, communication devices, and equipment components. The products cover seven core application areas including communication, AI and data centers, consumer electronics, automotive electronics, semiconductor manufacturing and packaging, new energy, and intelligent industrial control. With 10 production bases operating globally, the company has formed a production capacity network covering domestic industrial clusters and key overseas markets, combining vertical integration of material research and development capabilities with large-scale production capabilities. In terms of financial performance, Chaozhou Three-Circle (Group) has shown a clear growth trend. According to the prospectus, the company's operating income is expected to increase from 5.682 billion yuan in 2023 to 8.869 billion yuan in 2025, and the corresponding annual net profit is expected to increase from 1.583 billion yuan to 2.617 billion yuan. In the first quarter of 2026, the growth momentum further accelerated, with operating income increasing by 46.25% year-on-year to 2.681 billion yuan, and net profit attributable to shareholders reaching 791 million yuan, an increase of 48.48% year-on-year. In terms of profitability, the gross profit margins for 2023 to 2025 are 37.9%, 40.9%, and 39.9%, all at a relatively high level in the industry. From the revenue structure perspective, the electronic components business has grown into the company's core engine. In 2025, this sector contributed revenue of 3.308 billion yuan, a year-on-year increase of 43.95%, accounting for 37.3%. The communication device sector followed closely with revenue of 2.594 billion yuan, accounting for 29.3%; the electronic and ceramic materials sector had revenue of 1.959 billion yuan, accounting for 22.1%. Equipment components and other products together contributed approximately 11%. The diversified business layout not only stabilizes the revenue base but also enables the company to maintain growth flexibility in different downstream sectors. In terms of industry status, several core products have established significant global market share advantages. According to Frost & Sullivan data based on 2025 revenue, Chaozhou Three-Circle (Group) ranks first globally in three major products: alumina ceramic substrates, ceramic inserts and sleeves, and SOFC separator plates. Among them, the global market share of ceramic inserts and sleeves is approximately 70%, and ceramic packaging bases account for about 40%. In the automotive-grade product segment, the company's MLCC series covers specifications from 0201 to 2220, with capacitance values ranging from 0.1pF to 47F, and has gradually been applied to core components such as power systems, motor drive systems, and information entertainment systems in new energy vehicles. In the AI data center field, the company has also launched small-sized high-capacitance products such as 0603-226 and 0805-476, and the supply system is increasingly optimized. The rich and continuously upgraded product matrix has laid a foundation for the company to strategically position itself in multiple high-traffic sectors. Multiple engines drive, adding catalysis to Hong Kong listing? In the global core ceramic device component market, foreign companies, especially Japanese and Korean manufacturers, still have a strong competitive advantage. They rely on long-term accumulation of material science fundamentals and mature precision manufacturing capabilities to create high technological barriers and maintain a leading position in global supply chain coordination and large-scale production systems. Facing the situation where external competitors have already taken the advantage of being first movers, domestic top companies represented by Chaozhou Three-Circle (Group) are also undergoing an accelerated localization process. According to Three-Circle, based on its own characteristics, the company has formulated a multidimensional strategy upgrade roadmap. To elaborate, first, deepen the penetration of core business, such as MLCC focusing on miniaturization, high capacitance, and high voltage direction, ceramic inserts optimizing for low loss, and tapping into incremental demand in the stock market; second, extend the vertical industry chain, expand upstream key raw material procurement channels, connect the technical and production capacity of various business lines, enhance the autonomous controllable capability of the entire chain; third, upgrade globalization operations: leveraging overseas bases in Thailand, Germany, etc., to strengthen localized service network, reduce geopolitical trade risks, and promote the transformation of the brand from a "product supplier" to a "comprehensive solution partner." It is reported that the funds raised by this Hong Kong listing will focus on the expansion of fuel cell separator plate projects in Thailand. In addition, Chaozhou Three-Circle (Group) also plans to increase investment in cutting-edge material research and explore cross-domain applications such as semiconductors and healthcare. With the high prosperity of the industry, investors naturally have high expectations for Chaozhou Three-Circle (Group). However, it must be acknowledged that with Chaozhou Three-Circle (Group) A-shares completing an accelerated rise in just a few months, the capital market has objectively priced in some of the optimistic expectations for the high-end breakthrough of MLCC, the mass production of optical communication-related products, and the expansion of SOFC business. However, it is worth noting that the MLCC industry itself has obvious cyclical characteristics and has experienced drastic fluctuations in prices and demand in the past. How long the prosperity driven by AI and automotive electronics can last is still an unknown variable. In addition, the company's optical communication business is sensitive to the capital expenditure rhythm of global data centers; and the SOFC business has a high dependence on a single overseas major customer, Bloom Energy, with the pace of order volume directly related to the customer's expansion progress, international trade policy and geopolitical factors may also disrupt the expansion of overseas business. In summary, with over half a century of technological accumulation, a diversified product matrix, and steady financial performance, Chaozhou Three-Circle (Group) has established competitive barriers in multiple high-traffic sectors. This push for a Hong Kong listing is not only a step towards global positioning but also provides an opportunity for domestic and foreign investors to reevaluate its long-term value in a relatively rational valuation window. However, potential investors in the Hong Kong stock market should also recognize that under the current historically high levels of optimism, the investment risks of technology stocks also need to be re-evaluated. Whether Chaozhou Three-Circle (Group) can deliver a satisfactory performance in the tug-of-war between expectations and reality during its Hong Kong listing journey remains to be seen, and GMTEight will continue to monitor developments.