Greater China Technology Hardware: ABF Substrates: Same Thesis, Better Numbers.

研报英文原文证据摘录

Greater China Technology Hardware: ABF Substrates: Same Thesis, Better Numbers.

IdeaM

How Changes to Assumptions Change ABF S/D Dynamics

We now forecast ABF Supply/Demand imbalance to widen by 2030: After baking in

latest assumptions and estimates, our bottom-up ABF substrate S/D model points to 22%

undersupply by 2030 (vs ~15% previously). Detailed breakdown of the changes in

assumptions that resulted in this shortage widening came be found in the next section.

But this increased undersupply gives us more confidence on the pricing and margin

tailwinds that we expect to see for Unimicron, NYPCB, as well as ZDT.

Why are our supply/demand dynamics largely similar in CY26-28, although demand

has increased? This is because we bake in slightly stronger capacity expansion plans for

Unimicron. At the beginning of this year, Unimicron only had plans to expand capacity by

~10% y/y, but that has changed in the past few months, and through more de-

bottlenecking efforts, Unimicron is able to squeeze out ~40% additional capacity (if we

compare YE26e to YE25) across all of its major production sites (four in Taiwan and one in

China). Through utilizing all available space and increasing production efficiency,

Unimicron is able to quickly add new capacity that can come online this year, compared to

any greenfield capacity expansions that would typically take two or more years to bring

online.

Exhibit 2: Expecting ABF substrate under-supply gap to widen by 2030 vs our prior estimates

T mm²

30 160%

25 140%

Undersupply

20 120%

15 Oversupply 100%

10 80%

5 60%

0 40%

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026e 2027e 2028e 2029e 2030e

Total ABF Substrate Supply Total ABF Substrate Demand Supply/demand ratio ( >100% = undersupply)

Source: Morgan Stanley Research estimates.