Chaoying Electronics Files for Hong Kong IPO: Auto PCB Leader Sees Revenue Grow but Profit Fall, Posts 191M Yuan Loss in H1 2026

On September 21, Chaoying Electronics Circuit Co., Ltd. ("Chaoying Electronics") submitted its listing application to the Hong Kong Stock Exchange, with joint sponsors China International Capital Corporation and Guolian Securities International. This move comes less than 11 months after its debut on the Shanghai Stock Exchange's main board, where its share price surged over 395% on the first trading day. The company has now officially joined the Hong Kong exchange queue, launching its A+H dual listing strategy.

Beyond a mere capital markets maneuver, this represents a strategic bet on the "intelligent long-cycle" trend.

Company Profile and Market Position

Founded in 2015, Chaoying Electronics is a globally recognized manufacturer of high-end printed circuit boards (PCBs) and one of the world's leading suppliers of automotive PCBs.

The company focuses on the R&D, production, and commercialization of high-reliability, high-complexity PCB products, including:

• Double-sided boards
• Multi-layer boards
• High-density interconnect (HDI) boards

These products serve as the physical interconnection foundation for nearly all electronic systems, with applications in automotive electronics, data storage, communications, and AI servers.

Key market rankings (by 2025 revenue):

• 8th largest global automotive PCB supplier
• World's largest automotive HDI board supplier
• 3rd largest global AI data storage PCB and memory module PCB supplier

Financial Performance: Revenue Growth Without Profit Growth

Despite its market leadership, Chaoying Electronics faces a clear "revenue growth without profit growth" dilemma:

| Period | Revenue | Net Profit (Attributable) | Change | |--------|---------|--------------------------|--------| | 2023 | RMB 3.656 billion | RMB 266 million | – | | 2024 | – | RMB 276 million | – | | 2025 | RMB 4.752 billion | RMB 231 million | -16.24% YoY | | H1 2026 | RMB 2.912 billion | -RMB 191 million (loss) | +33.29% revenue growth |

While the immediate market reaction may suggest fundamental deterioration, the short-term profit volatility stems from a combination of one-time and strategic factors rather than core business weakness.

Key Factors Behind Profit Pressure

1. Thailand Factory Ramp-Up Costs

• Positioned as the company's key globalization hub targeting overseas automotive electronics and AI server high-end board markets
• Designed to circumvent trade barriers and meet localized supply requirements from overseas clients
• Initial stages involve low capacity utilization, high unit depreciation, and elevated manufacturing costs
• Significant foreign exchange losses in H1 2026 further amplified profit impact

2. Strategic Product and Capex Choices

• Ongoing resource allocation toward high-end HDI and high-speed multi-layer boards
• Rising R&D, equipment, certification, and sampling costs
• Fluctuations in upstream raw material prices (copper foil, copper-clad laminates) pressuring gross margins

The profit performance reflects a combination of:

• Reversible factors (foreign exchange losses)
• Phased factors (Thailand factory ramp-up)
• Structural factors (automotive board gross margin pressure)

The first two factors are expected to diminish over time, while the third requires longer-term technology upgrades and product mix adjustments.

Liquidity and Balance Sheet Concerns

As of H1 2026:

• Cash and cash equivalents: Approximately RMB 1.093 billion
• Net current assets: RMB 32 million
• Asset-liability ratio: 75.6%

While the company maintains strong growth momentum and market leadership, the combination of capacity ramp-up costs, FX losses, raw material volatility, and automotive margin pressure—alongside a 75.6% debt ratio and minimal net current assets—creates near-term profitability and liquidity challenges.

Strategic Shift: New Engines Accelerating

The income statement tells the story of "old story" pains, but the revenue structure reveals the beginning of a "new story."

Revenue Mix Changes (H1 2026 vs. 2023):

• Data storage revenue: +133.5% YoY
• Communications & AI server revenue share: 4.3% (2023) → 10.0% (H1 2026)
• HDI board revenue share: 23.4% (2023) → 43.8% (H1 2026)

This reflects a clear strategic pivot from low-end automotive boards toward high-end HDI and AI server boards.

Industry Context

According to Frost & Sullivan:

• Global PCB market CAGR (2021-2025): 2.8%
• Projected global PCB market (2026-2030): From $102 billion to $144.6 billion, CAGR of 9.1%

Growth by product type (2021-2025): | Product Type | CAGR | 2021 Market Size | 2025 Market Size | |--------------|------|------------------|------------------| | HDI boards | 9.4% | $11.3B | $16.2B | | Multi-layer boards | 3.6% | – | – | | Package substrates | 2.3% | – | – | | Single/double-sided boards | -3.2% | – | – | | Flexible boards | -0.9% | – | – |

Projected to 2030:

• HDI boards: 10.8% CAGR → $30 billion
• Multi-layer boards: 9.8% CAGR → $58.6 billion

The company's strategic pivot aligns well with these industry trends.

Technical Capabilities

Chaoying Electronics has demonstrated meaningful technical depth:

• Completed 50-layer AI server PCB technical certification
• Capable of processing up to 60 layers
• 7+N+7 multi-step HDI passed mass production verification
• Among few domestic PCB companies with multi-step HDI and any-layer interconnect HDI mass production capabilities
• Thailand P5A plant's mSAP advanced process line scheduled for completion and customer validation in Q4 2026

However, the supply bottleneck for AI server PCBs lies not in nominal capacity but in "effective capacity." PCBs with 30+ layers, M9-grade CCL, and high-end HDI involve more complex production processes, lower yields than standard products, require new equipment commissioning, and demand time for customer certification. Early completion of technical certification and capacity ramp-up could provide first-mover advantages.

Conclusion

The PCB industry—known as the "mother of electronic products"—is experiencing structural growth driven by AI computing infrastructure and automotive intelligence, with high-end products significantly outpacing traditional categories. Chaoying Electronics' proactive positioning in high-end HDI and AI server boards aligns with these industry trends.

However, as more manufacturers allocate resources toward automotive and AI server directions, the high-value segment will face increasing competitive pressure over the next 2-3 years.

Chaoying Electronics' Hong Kong listing comes at a crossroads of "short-term pain and long-term growth." In the near term, the company faces the financial challenge of revenue growth without profit growth. Over the long term, it is positioned in two high-growth tracks—AI computing and automotive electronics—betting on the "intelligent long cycle" with deep technical barriers and a clear capacity expansion strategy.

The Hong Kong listing is not merely a fundraising exercise but a critical component of the company's globalization and capacity expansion strategy. Through H-share listing, the company aims to optimize its capital structure, support high-end capacity expansion, and enhance its international profile.