Copper Foil to Ride on AI HVLP Demand Surge; Initiate on Defu/TGCF

研报英文原文证据摘录

Copper Foil to Ride on AI HVLP Demand Surge; Initiate on Defu/TGCF

me CAGR outlook of 3 2.3

15%-20% at Mitsui Kinzoku, the world's largest HVLP vendor, means an undersupplied market 2 1.3

in our view, which could crreate space for other competent players to gain share. We estimate -

HVLP4's processing fee per ton could reach >10x that of traditional HTE. Given ongoing 2025 2026E 2027E 2028E 2029E 2030E

NVIDIA Non-NVIDIA Switch Others

demand shift towards higher-spec products, we believe the copper foil industry's ASP will .Source: Jefferies estimates

continue to rise.

Chart 3 - PT P/E & PEG Comparison

Chinese vendors are gaining traction in AI copper foil. As the surge in AI capex has created 70 1.0

an industry shortage, we believe Chinese players' ability/willingness to rapidly expand capacity 60 56 59

0.8

will become a key advantage, allowing them to gain more traction in high-end copper foil. We 50

anticipate a notable supply gap in the next 1-2 years if we count only non-China capacity. But 40 35 0.6

by including the capacity of TGCF/Defu as emerging suppliers of high-speed copper foils, the 30 26 0.4

global HVLP capacity will likely rise from ~2kt/mo in 2025 to >5kt/mo in 2027 (or 3.5-4.0kt/ 20 0.2

mo of HVLP4 equivalent capacity), roughly matching 2027 demand, subject to each player's - -

capacity/yield rate ramp progress. This implies Chinese vendors' global market share could Defu TGCF

potentially rise from <10% in 2025 to >30% in the next 2-3 years. 2027 P/E 2028 P/E PEG (RHS)

.

Source: Company data, Jefferies estimates

Initiate on Defu/TGCF at BUY; Defu our top pick. We initiate on Defu/TGCF. Both are leading

Chinese players in AI copper foil on customer verification and shipment volume. TGCF is now