報告_GF_臻鼎4958_20260525

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原始內容

Zhen Ding Tech. Group (4958 TT)

AI Upside Continues

Maintain Buy, TP raised to NT$633: Since we initiated coverage on Zhen Ding in January, its stock price has rallied more than 220%, significantly outperforming peers. Moving forward, we still favor Zhen Ding for its market share gain in AI PCB and substrate supercycle. We now forecast Zhen Ding's EPS to be NT$16.41/31.63 for 2026/2027, highest among the street backed by its AI upside. We raised our multiple to 20x 2027E P/E, supported by the company's rapidly increasing AI exposure. In addition, we see further re-rating potential driven by its leadership in mSAP and the growing importance of mSAP in next-generation AI PCB.

AI market share gain: 1) Our checks indicate that Zhen Ding has captured ~20% share in Nvidia's compute tray, with ramp-up expected from late June and further penetration into switch trays beginning late 3Q26. 2) Zhen Ding has started shipments to Google in 1Q26. As Google's orders transit to V7 platform, we expect order to reaccelerate in 3Q26. 3) Driven by strong demand, mSAP pricing for optical modules increased by ~30% in 1Q26, while Zhen Ding maintains the leading global share in 1.6T optical module PCBs. As a result, we forecast Zhen Ding's AI revenue to reach RMB 6.3bn in 2026. Based on our estimates of AI PCB market TAM (RBM 92/197bn in 2026/2027) and Zhen Ding's market share gain, we expect Zhending's AI revenue to potentially reach RMB20bn in 2027.

ABF revenue contribution accelerates: ABF substrate pricing increased significantly in 1Q26, with domestic prices rising 20-30% and overseas prices up 10-20%, with another round of price adjustment expected in 2H26. Supported by higher ASP, capacity expansion, and improved utilization, we expect Zhen Ding's IC substrate GPM to improve significantly across 2026/2027.

mSAP to be the future of AI PCB: Due to more stringent line width and spacing requirements, we believe mSAP will become a critical technology trend for future AI PCB. We expect mSAP adoption to expand across 800G/1.6T optical modules, Nvidia's CoWoP solutions, and future CPO switches. As highlighted in our initiation report, we viewed AI exposure as the key rerating catalyst for Zhen Ding - a thesis that has already materialized, with the valuation rerating from 10-12x P/E to around 20x P/E. Looking ahead, we see another potential re-rating driven by mSAP, where Zhen Ding is well positioned to emerge as a leading beneficiary and capture incremental AI market share.

Risks: 1) AI demand slowing down; 2) Geo-political risks; 3) Intensifying competition.

Profit forecast

Source: Company data, GF Securities (Hong Kong) Brokerage.

数据来源：公司财务报表，广发证券发展研究中心

Maintained Target price

Buy NT$633

Yang Zhou SFC CE No. BSF949 zhouyang@gfgroup.com.hk

Jeff Pu, CFA SFC CE No. BNO719 jeffpu@gfgroup.com.hk

Michelle Jing SFC CE No. BUK594 michellejing@gfgroup.com.hk

Earnings Review

1Q26 results review

Zhen Ding reported 1Q26 revenue of NT$40.7bn, -28.4% QoQ and +1.6% YoY. By end market, Mobile Communication revenue totaled NT$22.2bn (-41.4% QoQ, -9.7% YoY); Computers & Consumer Electronics totaled NT$10.5bn (-14.8% QoQ, -4.7% YoY); Server, Optical Communication & Others revenue totaled NT$4.1bn (+29.7% QoQ, +93.6% YoY); IC Substrate totaled NT$3.9bn (+12.3% QoQ, +65.3% YoY). The company's gross profit was NT$8.8bn, representing a 21.6% GPM (down 1ppt QoQ, up 7ppt YoY). The company's 1Q26 basic EPS was NT$1.33 +101% YoY and -58% QoQ.

We forecast revenue of NT$240/334bn in FY2026/2027

We expect Zhen Ding's revenue for 2026 and 2027 to reach NT$240.1bn and $333.6bn, representing YoY growth of 31.5% and 39.0%, respectively; Gross profit is forecasted at NT$58.9/100.2bn; GPM is forecasted to be 24.5%/30.0%; Net income is expected to reach NT$19.0/36.8bn, reflecting YoY changes of +180.0% and +93.5%. By segment, Mobile Communication contributes to 54%/43% of total revenue in 2026/2027; Computers & Consumer Electronics contributes to 21%/16% of total revenue in 2026/2027; Server, Optical Communication & Others contributes to 15%/30% of total revenue in 2026/2027.

Figure 1: Earnings revision

Sources: Company data, GF Securities (Hong Kong) Brokerage

Figure 2: Zhen Ding's P&L forecast

Sources: Company data, GF Securities (Hong Kong) Brokerage

Valuation and Recommendation

Maintain Buy with TP of NT$633

We favor Zhen Ding for its market share gain in AI PCB and substrate supercycle. We now forecast Zhen Ding ' s EPS to be NT$16.41/31.63 for 2026/2027, highest among the street backed by its AI upside. We raised our multiple to 20x 2027E P/E, supported by the company ' s rapidly increasing AI exposure. In addition, we see further re-rating potential driven by its leadership in mSAP and the growing importance of mSAP in next-generation AI PCB.

Figure 3: Zhen Ding's Forward P/E

Sources: Bloomberg, GF Securities (Hong Kong) Brokerage

Risks

1) AI demand slowing down; 2) Geo-political risks; 3) Intensifying competition.

Rating definitions

Benchmark: Hang Seng Index (Hong Kong)

Company ratings

Buy

Stock expected to outperform benchmark by more than 10 %

Hold

Expected stock relative performance ranges between -10 % and 10 %

Underperform

Stock expected to underperform benchmark by more than 10 %

Sector ratings

Positive

Sector expected to outperform benchmark by more than 10%

Neutral

Expected sector relative performance ranges between -10% and 10%

Cautious

Sector expected to underperform benchmark by more than 10%

Hong Kong

Company

GF Securities (Hong Kong) Brokerage Limited

Address

27/F, GF Tower, 81 Lockhart Road, Wan Chai, Hong Kong

Telephone

(852) 37191111

Email

michellejing@gfgroup.com.hk

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