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# Kinwong Electronic (603228 .SH) — Based on Huatai Securities Deep Dive (Sep 23, 2026)AI + Automotive Dual Engines — PCB Leader at an Inflection Point
- URL: https://gawinresearch.com/kinwong-electronic-notes-0924/
- Published: 2026-09-24T03:37:42.000Z
- Updated: 2026-09-24T07:31:13.000Z
- Description: Kinwong Electronic (603228 SH): AI + auto dual engine drives inflection. Revenue from AI compute to grow from 25% to 56% by 2028E. New HDI/HLC capacity ramping mid-2026. Initiate with Buy, illustrative target RMB 137.25 (25x 2027E).
- Author: Gawin
- Tags: Notes

**Disclaimer**:This report is part of the “Notes” series by Gawin Research. It provides general information and an analytical framework only, and does not constitute investment advice, a solicitation, or an offer to buy or sell any security. Gawin Research is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, nor a registered commodity trading adviser. This communication is directed solely at sophisticated institutional investors and high‑net‑worth individuals who can independently evaluate risks. As of the publication date, the author(s) and/or Gawin Research \[hold / do not hold\] positions in Kinwong Electronic (603228 SH), including \[common shares / options / derivatives / none\]. No compensation has been received from the issuer, underwriter, or any third party for preparing or distributing this report. All financial data are based on public filings (e.g., 1H26 interim report, exchange announcements, Huatai 2026/09/23 initiation) and third‑party vendors \[Prismark / LightCounting / Wind / company IR\]. Figures are in \[RMB\] unless stated; PRC GAAP, IFRS and US GAAP differences may cause restatements. This note contains target‑price/scenario discussion solely as an illustrative framework—not a guarantee of returns. Forward‑looking statements are subject to risks; see footer disclaimers.

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### Kinwong Electronic (603228 SH): AI + Automotive Dual Engines — PCB Leader at an Inflection Point

**Investment Thesis**

We initiate-style coverage on Kinwong Electronic with a Buy framework and a 12-month illustrative target of RMB 137.25 (≈25x 2027E P/E). The core thesis centers on the company’s strategic pivot from a global leader in automotive PCBs to a high-end supplier for AI computing infrastructure. Communications & data infrastructure revenue surged 70.67% YoY in 2025 and accelerated to +114.58% YoY in the first four months of 2026\. We model AI-related revenue growing from 25% of total sales in 2026E to 44% in 2027E and 56% in 2028E. This transition, coupled with the ramp-up of advanced HDI/HLC capacity at the Jinwan facility (additional RMB 5bn capex) starting mid-2026 and the Thailand plant within 2026, should support a structural gross margin recovery.

*Source: Huatai Securities initiation report dated 2026/09/23; company filings.*

**Key Data Points & Logic**

- **Earnings trajectory:** We forecast net profit of RMB 2.20bn / 5.50bn / 8.38bn for 2026E/27E/28E, implying YoY growth of 78.9% / 149.5% / 52.5%. Projected 2027E EPS of approximately RMB 5.49 and ROE of around 30.4%. Average selling prices are assumed to increase 7.8% / 20.0% / 13.3% YoY over the same period.
- **Industry tailwinds:** Prismark forecasts the global PCB market to reach USD 144.6bn by 2030 (11.0% CAGR, 2026–30). LightCounting estimates optical module shipments will grow at a 34.69% CAGR over the same period. The shift to 1.6T speeds requires line width/spacing below 25/25μm, making mSAP the likely standard. Per-module PCB content could rise from approximately USD 2–3 for 400G to over USD 20 for 1.6T. Under our base case, we estimate the addressable market for optical module mSAP PCBs at RMB 6.1bn / 21.3bn / 35.2bn for 2026E/27E/28E.
- **Capacity and technology positioning:** The company has announced an additional RMB 5bn investment in its Jinwan campus, with trial production in mid-2026 and commercial launch by September 2026\. Its Thailand facility is also scheduled to commence production within 2026\. Notably, the company supplies multi-layer PTFE PCBs to a leading global AI hyperscaler and is one of only two qualified FPC suppliers for liquid cooling systems in AI servers. It achieved customer certification for 9-step HDI in just 90 days.
- **Listing context:** 603228 SH trades on the Shanghai Stock Exchange (SSE main board). Reported 1H26 revenue of approximately RMB 8.61bn (+21.37% YoY) and net profit of approximately RMB 0.60bn (−7.38% YoY). Closing price as of 24 September 2026: approximately RMB 106.5, implying a TTM P/E of roughly 95x.

**Independent View / Cross-Check Considerations**

- **Valuation discount deserves scrutiny:** The illustrative 25x 2027E P/E target implies a discount versus the peer average of approximately 33x (Shennan Circuits, Unimicron, Redboard Technology per Huatai), justified by Kinwong’s currently lower AI revenue mix. However, by 2027E we estimate AI will already represent approximately 44% of sales, approaching pure-play AI PCB names. Given the projected earnings growth trajectory (+149.5% in 2027E), the discount may narrow if orders materialize as expected. That said, the 2027E net profit forecast is an outlier-dependent base-case assumption, not a floor.
- **Cash flow strain is the key risk:** We flag elevated capital expenditure of RMB 4.7bn / 4.9bn / 5.3bn for 2026E/27E/28E. Short-term borrowings have risen from approximately RMB 380mn to approximately RMB 3.79bn per Huatai disclosures, with financing cash inflow modeled at approximately RMB 2.4bn in 2026E alone. In this heavy-asset expansion phase with rising leverage, any delay in AI order conversion would materially compress financial flexibility.
- **A key cross-check metric:** Management guides for ASP growth of 7.8% in 2026E. However, the strong 71% revenue growth in 2025 was volume-driven, not price-led. The inflection to 20% ASP growth in 2027E hinges critically on the actual shipment mix of high-value products such as mSAP. We recommend investors focus on disclosed AI revenue and gross margin data in the Q3 2026 report as a more reliable lead indicator than internal equity incentive targets.

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### B2 · Article Footer

**Sources**

This analysis is based on publicly available information from Kinwong Electronic’s filings (1H26 interim report, SSE announcements), supplemented by Huatai Securities’ initiation report “Kinwong Electronic (603228 SH): AI + Automotive Dual Engines” dated 2026/09/23, and data from Prismark (global PCB outlook), LightCounting (optical modules), Wind, and company investor relations. All figures have been cross-checked against original filings where possible. The author assumes no responsibility for the accuracy of third-party data.

**Conflicts of Interest & Holdings**

As of the last trading day prior to publication, the author(s) and Gawin Research \[do / do not\] hold a long or short position in the securities discussed (603228 SH), including options, derivatives, or \[none\]. Neither the author nor Gawin Research has received any direct or indirect compensation from the issuer, its affiliates, or any underwriter for the production of this report. Gawin Research does not accept payment for coverage or favorable analysis. If any material conflict arises in the future, it will be prominently disclosed in an updated version of this article.

**Forward-Looking Statements**

Certain statements constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and equivalent concepts, including but not limited to capacity ramp timelines (Jinwan, Thailand), 9-step HDI certification, 1.6T/mSAP adoption rates, AI revenue mix, ASP trajectory, net profit and margin projections. Such statements are subject to significant business, economic, regulatory, and competitive uncertainties, including demand fluctuations, yield improvements, customer qualification processes, foreign exchange movements, and financing conditions. Actual outcomes may differ materially. Gawin Research undertakes no obligation to update any forward-looking statement except as required by applicable law.

**Scenario Valuation Boundaries**

The illustrative target of RMB 137.25 (based on 25x 2027E P/E) and any base/bull/bear scenario outputs presented herein are intended solely as an illustrative framework for understanding key value drivers. They do not represent a price target, fair value estimate, or recommendation to buy, sell, or hold any security. Input assumptions — including AI revenue mix, ASP trajectory, capacity utilization rates, discount rates, terminal values, and foreign exchange rates — are inherently uncertain. Small changes in these inputs (e.g., AI mix ±10 percentage points, ASP ±5%, capex timing shifts) can produce large variations in output. Investors should conduct their own independent analysis before making any investment decision.

**Cross-Market & Jurisdictional Notes**

This report discusses securities listed on the Shanghai Stock Exchange (603228 SH, traded in CNY, reported under PRC GAAP). Differences in listing rules, trading hours, settlement cycles, currency (CNY vs. HKD vs. USD), dividend taxation, short-selling regulations, and Stock Connect mechanisms may materially affect investment outcomes. PRC GAAP, IFRS, and US GAAP treatments may result in material restatements. For EU/UK readers: this content is classified as “non-independent research” and is provided for professional clients/eligible counterparties only; it does not meet MiFID II independence requirements. For US readers: distributed as a general publication under the publisher’s investment-adviser registration exemption; not tailored to any individual’s financial situation. Always consult a qualified financial advisor before acting on any information herein.

**Source Report**

本篇分析基于华泰证券于2026年9月23日发布的深度研究报告：  
《看好 PCB 龙头 AI 与汽车双轮驱动》  
分析师：郇正林、田莫充、汤仕翯  
报告类型：公司深度研究报告