Introduction:
Everyone is familiar with PCB. In the first half of 2019, due to the acceleration of 5G construction, many PCB-related companies in A-shares rose sharply and their performance increased significantly. As the main variety in PCB, the downstream mobile phone market is its main application product. With the rapid explosion of wearable market and future automotive electronics trends, FPC ushers in an incremental market.
printed circuit board (Printed Circuit Board, PCB), also known as printed circuit board, refers to a printing board that forms dot connections and printing components on a general-purpose substrate according to a predetermined design. Its main function is to make various electronic components form a connection to predetermined circuits. It is an important electronic component and a support body of electronic components. The manufacturing quality of
printed circuit boards not only directly affects the reliability of electronic products, but also affects the overall competitiveness of system products. The development level of its industry can reflect to a certain extent the development speed and technical level of the electronic information industry in a country or region.
PCB is mainly divided into rigid boards (single-sided panels, double-sided panels , multi-layer boards), flexible boards (FPCs) and rigid-flex bonding boards.
mobile phone market is the largest application product for FPC materials.
flexible circuit board (Flexible Printed Circuit (FPC) with its excellent physical characteristics conform to the development of miniaturization and thinness of electronic products.
According to Prismark data, the global FPC output value reached about US$12.8 billion in 2018, and is expected to reach approximately US$14.9 billion by 2022, with an annual growth rate of 3.87%.
downstream application structure, consumer electronics products are the main application areas of FPC, among which smartphones and tablets account for 40% and 16% respectively, accounting for most of the downstream application market of FPC. With the rapid development of automotive electronics in recent years, the proportion of demand for FPC has gradually increased to 14%.
▲Mobile phones are the main application product of FPC materials
In the past 10 years, the FPC usage of iPhone has increased significantly (from 10 pieces of iPhone4 to about 25 pieces of FPC in iPhone 11). Being deeply influenced by the firm use of FPC boards by Apple mobile phone , mainstream brands are currently introducing more and more FPCs into their products. The single-machine usage of smartphone FPC boards has reached 10-15 pieces, effectively promoting the demand for FPC boards. In the future, we are expected to see more and more FPCs appear in various brand smart terminals, thereby driving the growth of the entire FPC industry chain.
With the implementation of innovations such as LCP/MPI RF antennas/front 3D structured light/rear TOF lenses, FPC is expected to continue to rise in both quantity and price in iPhones. Coupled with the general trend of 5G replacement and the explosion of wearable hardware (TWS and watches), Apple 's position as a single major customer in the FPC industry is unshakable. We expect Apple 's demand for FPC is expected to exceed US$12.6 billion.
Automotive Electronics and Wearable Devices Market has become the incremental market for FPC materials
FPC has the characteristics of being thin and flexible, and has the highest degree of compatibility with wearable devices. It is the preferred connector device for wearable devices. The FPC industry is expected to become one of the biggest beneficiaries of the booming wearable device market.
According to Counterpoint data, the global shipment of AirPods exceeded 60 million units in 2019, driving the global TWS headphone market to grow by 160% year-on-year (120 million units in 2019); IDC predicts that driven by TWS headphones, the global wearable device shipment will exceed 300 million units, an increase of more than 70% year-on-year; Gartner expects the global wearable device market size to be US$52 billion in 2020, an increase of 27% over 2019.
▲Global wearable device shipments have grown rapidly
TESLA leads the trend of automotive electronicization. It has plans to adopt FPC solutions in the fields of BMS/body control cables (BUSBAR, etc.), and the value of bicycles is expected to reach the magnitude of US$1,000 in the future. In the future, with the deepening of the trend of automobile automation, networking and electrification, the proportion of automobile electronics in the cost of the vehicle is expected to exceed 50%. According to Prismark, the output value of FPC in the automotive electronics sector will reach US$850 million by 2021.
▲ Global automotive field FPC output value forecast
FPCh production capacity transfer to China
Japanese-funded enterprises and China Taiwan region wants enterprises to occupy the world's major FPC production capacity.According to Prismark data, Japan's Qisheng and China Pengding Holdings are the top two FPC suppliers in the world and are also the first-tier FPC manufacturing companies; the second-tier companies include Japan's Sumitomo, Fujikura, Samsung Electric, China's Toyama Precision , and China's Taijun, with a market share of between 5% and 10%. , among which Pengding, Qisheng, Dongshan Precision , etc. are all core suppliers of Apple .
▲ Global FPC manufacturers market share in 2018
In recent years, the major Japanese and Korean FPC manufacturers have declined, and their share of Apple continued to shrink in , and their capital expenditure/R&D investment/cost control have gradually fallen behind; except for Zhending (Pengding), FPC manufacturers in Taiwan, China have not expanded production on a large scale in recent years, and their total share has even declined slightly. Mainland Chinese enterprises represented by Dongshan Precision took advantage of the momentum, taking advantage of the capital/management advantages to undertake the transfer of high-quality assets and production capacity, and continued to increase capital expenditure and R&D investment. The share of Apple and Tesla has increased significantly. Looking ahead, it is expected that Dongshan Precision /Pengding Holdings will reshape the FPC competitive landscape and stage a new situation of two dragons playing with the pearl.
A-share major listed companies
Dongshan Precision (002384)
Dongshan Precision acquired Apple FPC supplier MFLX in 2016, and acquired Multek, a PCB subsidiary of Flex in 2018. After the acquisition was completed, the company became the top ten circuit board companies in the world with mass production capabilities of high-precision FPC, HDI and high multi-layer PCB.
FPC business is driven by the Apple boom cycle, and its categories and share are expected to gradually increase. Apple soft board system mainly includes three categories: ultra-fine FPC, multi-layer FPC and RF FPC. Dongshan currently relies on its advantages in multi-layer FPC to occupy about 10%-12% of the Apple soft board procurement, while Japanese suppliers that account for more than 40% of the total share are gradually withdrawing. Dongshan is expected to rely on its layout in the two major tracks of RF FPC (such as LAT+dock, LCP, etc.) and ultra-fine FPC (display touch, etc.).
has an in-depth and forward-looking layout in 5G equipment and 5G terminals. As a leading domestic circuit board manufacturer and 5G leader, it is firmly optimistic about the company's industrial strategic layout in the 5G wave.
Pengding Holdings (002938)
is the world's largest PCB company, and its customers include Apple Company, Nokia, SONY, OPPO, vivo and Xiaomi and other leading domestic and foreign brand customers.
Over the past decade, the company has deeply deployed the FPC/SLP/HDI tracks of multi-dimensional products such as smart phones and wearables, and has accumulated a deep technical background. As the leader of FPC, the company has a high irreplaceability in the competition of the consumer electronics industry chain and has the ability to track industrial innovation trends ahead of other links of the industrial chain. Benefiting from the optical and RF upgrades of the new Apple 5G phone, Airpods, Watch volume and Android motherboard upgrade trends, the company fully benefits from the upgrade of 5G terminals and category expansion.
