Zhongtai Electronics | Kinwong Electronics: AI Customer/MSAP Progress Smooth, Positive on Future Earnings Flexibility

English summary

Computing-power customers progressing smoothly, with deep MSAP technology accumulation: 1) Long-term R&D cooperation with customer N; orders from N in 26Q1 exceeded full-year 2025, and with the Rubin series expected to gain substantial share in core components like mid-board and switch tray, further volume growth is likely; progress with other ASIC customers is also orderly, implying significant AI business flexibility. 2) The company has deep MSAP expertise and is among the few with high-yield mass production; deep cooperation with leading optical module makers such as Innolight, Eoptolink, Luxshare, and Source Photonics, and continued volume growth is expected amid MSAP shortage. Ample capacity reserves: currently 3 MSAP lines with ~400k/month capacity each; expected to increase to 5 by year-end and another 10 by 2027.