Hong Kong stocks in the PCB sector traded higher with volatility on October 5. As of the time of writing, KB Laminates (01888) surged more than 9%, Kingboard Holdings rose over 8%, Guanghe Technology gained more than 7%, and Victory Giant Technology and Jingwang Electronics both climbed over 3%.

On the news front, the PCB supply chain is experiencing a rally in both volume and price. In the upstream segment, KB Laminates has already issued seven rounds of price increase notices this year. Nan Ya Plastics has raised product prices by another 20% since September. Meanwhile, price hikes are transmitting across the entire downstream chain: Jiangxi Hongruixing Technology previously announced a 10% increase in copper-clad laminate ex-factory prices. Fiberglass leader China Jushi raised prices for thick and thin electronic cloth by 15% and 20% respectively in September.

A research report from Guojin Securities previously noted that strong AI demand is driving simultaneous increases in PCB volume and price. Currently, multiple AI-PCB companies have strong order books, are operating at full capacity with all output sold, and are aggressively expanding production. High earnings growth is expected to continue. AI copper-clad laminates are also in strong demand. Due to slow capacity expansion by overseas copper-clad laminate manufacturers, shortages and price increases persist, and leading mainland copper-clad laminate manufacturers are poised to benefit actively.