Zhejiang Wazam New Materials Co. Ltd.: Riding the Wave of AI‑Driven PCB Demand
Zhejiang Wazam New Materials Co. Ltd. (股票代码 603186) is a key player in the information‑technology sector, specializing in electronic equipment, instruments, and components. With a market capitalization of about 10.17 billion CNY and a 2026‑Jan‑22 closing price of 69.2 CNY, the company sits at the intersection of two dynamic forces: the rapid expansion of printed circuit board (PCB) production and the surge in artificial‑intelligence (AI) infrastructure requirements.
1. Industry Context: A Surge in High‑End PCB Demand
The global PCB market has entered a “high‑growth” cycle driven by AI servers, automotive electronics, and high‑frequency communication. According to the latest market outlook, the industry is expected to grow from US $88 billion in 2024 to roughly US $94.7 billion by 2029—a compound annual growth rate of about 5.2 %. This upward trajectory is reinforced by the projected 16.3 % annual compound growth in AI‑server‑related HDI boards through 2028.
In China, the country dominates with roughly 50 % of global PCB capacity, concentrated in the Pearl River Delta (40 % of national capacity), the Yangtze River Delta, and the Bohai Rim. The continued expansion of high‑end production—particularly high‑density interconnect (HDI), high‑layer count, and flexible printed circuit (FPC) boards—has spurred many manufacturers to accelerate capital expenditures and scale up output.
2. The Copper‑Clad Laminate (CCL) Boom
At the heart of advanced PCB manufacturing lies the copper‑clad laminate (CCL). Recent reports highlight a “new round of expansion” in the CCL industry, with major firms—such as Jinan‑based Yangtze‑Tech, South Asia Materials, and Jin‑An National Co.—announcing multi‑hundred‑million‑yuan investment plans for high‑performance CCL production. These expansions are being driven by the rising demand for AI servers, electric‑vehicle electronics, and optical communication equipment.
The CCL boom is accompanied by an acceleration in the domestic replacement of core materials. Domestic high‑performance phenolic resins and flame‑retardant additives are now able to rival imported counterparts in performance, mitigating supply‑chain risks that once favored overseas suppliers. This shift is expected to lower input costs and improve profit margins for manufacturers that have embraced domestic sourcing.
3. Zhejiang Wazam’s Strategic Position
Zhejiang Wazam, as a producer of electronic‑grade materials, stands to benefit in several ways:
| Opportunity | Impact on Zhejiang Wazam |
|---|---|
| Higher volume of CCL orders | Potential increase in raw‑material purchases and downstream sales if the company supplies specialty resins or flame‑retardants for CCL production. |
| Domestic material substitution | Ability to supply high‑quality, cost‑effective alternatives to imported flame‑retardant agents and photoresists, strengthening customer relationships with leading CCL manufacturers. |
| AI‑driven demand for high‑performance PCBs | Enhanced demand for advanced electronic components, offering a revenue lift if Zhejiang Wazam expands its product portfolio to include high‑frequency and high‑temperature materials. |
| Expansion of high‑layer and flexible PCBs | Potential for new business lines, such as specialized adhesives or encapsulants tailored for multi‑layer or flexible substrates. |
While the company’s public disclosures do not yet detail specific contracts with leading CCL producers, its alignment with the industry’s material supply chain positions it well to capture a share of the burgeoning market.
4. Financial Snapshot
Despite a challenging earnings environment—reflected in a negative P/E ratio of -324.36—Zhejiang Wazam’s market presence remains substantial. The company’s stock has shown resilience, trading within a 52‑week range of 18.68 CNY to 72.65 CNY, and closing at 69.2 CNY as of 2026‑Jan‑22. The negative earnings ratio indicates that investors anticipate a turnaround, likely tied to the broader industry revival and the company’s potential to capitalize on new material demand.
5. Outlook and Risks
Positive Drivers:
- Continued AI server and electric‑vehicle production growth will sustain high‑end PCB orders.
- Domestic material innovation reduces reliance on volatile foreign supply chains.
- Zhejiang Wazam’s potential to secure contracts with expanding CCL manufacturers could boost revenue.
Potential Headwinds:
- The industry’s capital intensity may lead to overcapacity if expansion outpaces demand.
- Tightening global supply chains for copper and other raw materials could increase input costs.
- The company’s current earnings volatility may deter risk‑averse investors.
6. Conclusion
Zhejiang Wazam New Materials Co. Ltd. occupies a critical niche at the intersection of advanced materials and the booming PCB industry. With AI infrastructure demand fueling a surge in high‑end board production, the company’s capability to supply domestically produced, high‑performance electronic materials positions it to benefit from the sector’s upward trajectory. As the industry continues to expand its production capacities and shift towards domestic sourcing, Zhejiang Wazam’s strategic alignment with these trends suggests a cautiously optimistic outlook for future growth.
