[Zhenzhuo Institutional View] Shenghong Technology (02476.HK), a major supplier of AI and high-performance computing PCBs, reported a 79.7% year-on-year increase in revenue for the fiscal year 2025.

$VGT (02476.HK)$ It is one of the leading suppliers of advanced AI and high-performance computing printed circuit board ("PCB") products, focusing on the R&D, production, and sales of high-end high-density interconnect ("HDI") and multi-layer printed circuit boards ("MLPCB").

According to Frost & Sullivan, based on the revenue scale of AI and high-performance computing PCBs in the first half of 2025, the company ranked first globally with a market share of 13.8%. It has the capability to produce PCBs with more than 100 layers and is among the first batch of companies worldwide to achieve large-scale production of 6th-order 24-layer HDI products, as well as possess the technical ability to produce 10th-order 30-layer HDI and 16-layer any-layer HDI. Its products are widely used in high-growth areas such as artificial intelligence, new energy vehicles, and high-speed network communications, promoting the development of China's high-end PCB industry.

Benefiting from advancements in multi-layer PCB manufacturing capabilities, the company’s revenue from PCB products used in AI and high-performance computing surged significantly, becoming a new growth driver. Revenue increased from RMB 706 million in 2024 to RMB 8.3 billion, with its share of total revenue rising sharply from 6.6% to 43.2%. Overall PCB product revenue grew by 80%.

Financially, revenue grew by 79.7% in 2025. Gross margin increased substantially from 22.7% to 35.2%, primarily driven by an increase in the proportion of high-margin products (multi-layer PCBs and HDI). The average selling price of these two product categories continued to rise, which, under growing demand for high-performance products, may support maintaining or even further increasing gross margins at a high level. Profit growth reached 2.7 times, amounting to RMB 4.3 billion in 2025.

Shenghong Technology attracted numerous cornerstone investors, who collectively subscribed to up to 44.66% of the offered shares. This offering did not include a mandatory reallocation mechanism, with no more than 15% of the global offering shares eligible for reallocation to the Hong Kong public offering.

The offering price for Shenghong Technology's listing in Hong Kong is HKD 209.88 per share, compared to the closing price of its A-share (300476) on April 10 at CNY 289.77 per share (equivalent to HKD 333.23), representing a discount of 37%.

Source: KGI Securities

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