Chinese MLCC firms’ profits and stock prices fatten on hunger for electronic ‘rice’
Shares in Guangdong Fenghua, Suzhou GYZ, Chaozhou Three-Circle and upstream suppliers shoot up as relentless AI demand reshapes market
Chinese manufacturers of multilayer ceramic capacitors (MLCCs) – tiny components required in great numbers to regulate electrical flow in electronic devices – are riding a stock rally on the back of explosive first-half earnings, fuelled by insatiable global demand for artificial intelligence infrastructure.
Shares of Shenzhen-listed Guangdong Fenghua Advanced Technology, one of the country’s leading producers of consumer-grade MLCCs, surged by the exchange-imposed 10 per cent daily limit on Wednesday morning. It marked the second time the stock hit the ceiling this week, capping a rally of more than 180 per cent so far this year.
Meanwhile, Suzhou GYZ Electronic Technology jumped 20 per cent to hit the daily limit on Shanghai’s Nasdaq-style Star Market, and Chaozhou Three-Circle, a major domestic manufacturer of high-capacitance MLCCs, saw its Shenzhen-traded shares climb around 8 per cent, putting its year-to-date gain above 130 per cent. Its Hong Kong shares also rose 5 per cent on Wednesday.
Upstream suppliers also benefited from the momentum, with Jiangsu Boqian New Materials gaining nearly 6 per cent and Shandong Sinocera Functional Materials rising almost 3.5 per cent on Wednesday.