Goldman Sachs: China PCB Dtech (301377.SZ) Factory Visit; PCB Drill Bits Riding Strong AI PCB Demand, New Capacity Expanding
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Goldman Sachs hosted a management meeting with Dtech (301377.SZ), the global leader in PCB drill bits, during a recent China PCB tour. Dtech operates manufacturing capacity across China, Thailand, and Germany. Management highlighted that surging AI PCB demand and accelerating specification upgrades are directly driving drill bit shipment growth. Because AI PCBs utilize high-end copper-clad laminate with greater hardness and feature higher layer counts, drill bit lifespans are shortened and drilling times are extended, significantly increasing consumable consumption.
Dtech possesses distinct competitive advantages, including processing precision of 0.001mm and length-to-diameter ratios exceeding 50 times. Critically, 95% of its manufacturing equipment is developed and produced in-house, yielding substantial cost advantages. Self-developed machinery, such as high-precision multi-station grinders, allows the company to expand capacity rapidly, transitioning from assembly to production within just one to three months compared to the eight-month procurement cycle for imported alternatives.
The company is actively expanding its Thailand facility, targeting an annual capacity of 15 million drill bits by 2026, flexibly paced according to customer orders. Extending this positive signal to the broader sector, Goldman Sachs expects AI server and high-speed switch upgrades to elevate PCB and CCL content values globally. Consequently, the firm initiated Buy ratings on Victory Giant, WUS, and Shengyi Technology.