Shandong Sinocera - A First Take: 2Q26 - MLCC powder upside emerges; strong top-line growth offsets margin pressure

Research evidence excerpt

Asia Pacific Equity Research

06 August 2026

Shandong Sinocera - A

First Take: 2Q26 - MLCC powder upside emerges;

strong top-line growth offsets margin pressure

Our First Take: Sinocera’s 2Q26 results are likely to be taken positively by

the market with the company reporting net profit of Rmb220mn, up 13% y/y

(source). The earnings growth was mainly owing to 1) robust top-line growth

in 2Q (up 23% y/y), backed by electronics and biomedical materials

businesses; and 2) quarterly profitability recovery with 2Q gross margin

rebounding to 38+%, reversing three consecutive quarters of decline. With

recent zirconia powder product ASP also trending higher (source), this signals

improving momentum for the MLCC powder business from 2Q26 onwards.

Overweight

300285.SZ, 300285 CH

Price: Rmb67.27

05 Aug 2026

Price Target: Rmb136.00

PT End Date: 31 Dec 2027

Asia Oils

Lei Mu AC

(86-21) 6106 6319

SAC Registration Number: S1730521050002

J.P. Morgan Securities (China) Company

Limited

Key Positives

1) Electronics materials top-line growth was positive, with segment revenue up

11% y/y in 1H. We believe this was mainly due to strong demand growth for

MLCC units in the domestic market; 2) Electronic materials segment gross

margin improved to 38% in 1H, up 4.6ppt y/y, the highest first half reading

since 1H22. With high-grade (AI & Auto) MLCC powder capacity completed

at YE25 and a gradual ramp-up alongside product qualification progress in 2Q,

we expect the new MLCC powder capacity to be fully utilized in 2H; and 3)

Other segments such as the biomedical and new energy segments also showed

robust revenue growth, y/y up 22% and 56%, respectively.

Key Negatives

Despite quarterly top-line biomedical and construction materials growth in 2Q,

downward pressure on the profitability of these segments continued, with

gross margin down 2.4ppt y/y and 11.7ppt y/y, respectively.

Likely Changes to Consensus

Sinocera’s recent share price outperformance since the 1Q26 results

announcement (from 28 April to 5 August, up 82% vs. SZCOMP Index down

5%) may have partially priced-in the positives of MLCC industrial trends.

FY26/27 earnings consensus remains at Rmb812mn and Rmb1,028mn. With a

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