PCB Future Demand Analysis
In the second half of the year, PCB high growth plate decreased, and automobile plate continued to bear pressure due to the limited outbreak of lack of core, or ushered in a good opportunity of ambush at the bottom.
In the second quarter of 2021, high growth applications accounted for 41% (PC + consumer electronics + server), 14% (automotive electronics + Aerospace), 24% (Communications + other computers + industrial control + medical), and 21% (mobile phones) with inventory pressure. Although Q2's prosperity was weaker than Q1's, it still maintained a relatively high momentum.
Looking forward to the second half of the year, high growth applications account for 24% (consumer electronics + servers), applications that can maintain growth account for 14% (automotive electronics + Aerospace), applications with stable demand account for 45% (mobile phone + communication + other computers + industrial control + medical), and demand that will have inventory pressure account for 17% (PC). It can be seen that the high growth sectors will decrease significantly in the second half of the year.
5G section under pressure
According to the guidance of the three operators, the number of 5g base stations is expected to be completed from 64million to 84000 stations this year, with the shipment volume of 640000 stations increased by 0% - 31.3% on a scale compared with last year. However, in terms of structure, 200000-400000 stations in the 6484 million stations are built in 700m frequency band, which means that the value of single station PCB will be reduced by 50%, and the cost reduction requirements of 5g base station will be calculated according to the newly built 740000 stations this year, It is estimated that PCB for base station communication will decline 28% year-on-year, and demand is under pressure.
Server market pull and upgrade
From the industrial chain, we can see that as the first quarter of this year is waiting for the new server platform iteration in the second quarter, neither cloud computing nor server manufacturers have made too much inventory reserves for servers. This can be seen from the first quarter revenue ring ratio and year-on-year comparison of (China) Taiwan Xinhua, so the current inventory level is relatively low.
The car plate is limited due to the lack of core
Automobile has consumer demand as the basic support. Although it is now limited by chips, the upstream and downstream stock can just match the rhythm of automobile shipment. Therefore, it can be considered that this year's automobile demand can maintain a stable growth throughout the year, and the fluctuation will be relatively small. The domestic economy will definitely recover in 2021, and the GDP growth rate is expected to rise to 8% - 9%. Automobile consumption is expected to be released after it is suppressed in 2019-2020. 2021 is an excellent time window for the release of these delayed rigid demand. In addition, the increase in demand for new energy vehicles can not only stimulate sales growth, but also bring more demand for PCB and CCL. Therefore, vehicles should belong to explosive growth plate this year.
Household appliances have high prosperity and low inventory level
Under the catalysis of home economy, real estate sales and smart home, household appliances have ushered in a long-lasting burst of consumer demand. Combined with the sales data and inventory data, it is judged that the household appliance industry chain maintains a high prosperity throughout the year with strong certainty.
CCL factories have higher bargaining power than PCB factories
The concentration of copper clad board is still higher than PCB, and the price increase event makes some small manufacturers gradually clear because of the unavailability of raw material resources, so the concentration of copper clad board is still higher than PCB; Since this year, there are mainly 10 companies that have been financing and expanding production through IPO and IPO, with a total of 7.11 million square meters / year of PCB production expansion, with a total financing amount of 13.3 billion yuan. Without considering other equity and debt financing methods, the current IPO Financing has been expanded and put into operation again since 2017. PCB expansion will enhance the scarcity of copper clad laminate, which makes the relative bargaining power of copper clad laminate manufacturers higher. However, there is limited room to continue to rise, and the economy has reached its peak. Therefore, in the case of relatively high bargaining power of copper clad plate, it is believed that copper clad factory can still maintain higher profitability after the price increase.
The expansion lines of mainstream CCL plants are mainly for high-end high-frequency and high-speed products. However, because the production lines of high-speed products and ordinary products can be converted, if the high-end demand cannot be met on schedule, the effective supply will be more abundant. Under this logic, we can see that the server, an important application scenario of high-end high-speed products, has been delivered as scheduled in the second quarter, which means that the new capacity expansion of mainstream manufacturers will compete for the server market, while the effective supply of the ordinary FR4 market at the middle and low end will be weaker.
Due to the influence of environmental protection policy and industrial cycle, electronic copper foil has not been expanded much in the past. However, it will take 1.5-2 years for copper foil production capacity from expansion to release, which means that copper foil supply capacity is difficult to release in the short term. According to the industry chain research, almost no copper foil production capacity is put into production this year, and the production capacity that can be put into production next year is also relatively limited, which means that the supply and demand relationship of copper foil will take at least two years to balance.
On this basis, copper foil factories will dominate the price for a long time. However, they think that the price rise of copper foil is limited. On the one hand, the overall price of copper foil has exceeded the historical high position, and the price rise of copper foil will be resisted by negative feedback of demand. On the other hand, the current price is mainly supported by the price rise of copper, which is close to the historical high position, The price rise will also be resisted by all negative feedback of copper demand, so we think the overall price rise of copper foil is limited.
