Expect momentum to recover from Q3, with new customer expansion supporting valuation; reiterate Buy

Overview

This report focuses on Victory Giant Technology's AI server PCB business rhythm, Nvidia new platform upgrades, customer expansion, and valuation. BofA expects the company’s Q2 growth to be relatively slower, mainly because Vera Rubin platform ramp-up officially shifted to June and traditional businesses are under pressure from FR-4 price increases; however, as higher-value Vera Rubin platform volume gradually increases and high-layer TPU orders ramp up, profit momentum is expected to recover from Q3.

Core views

The core view is that short-term profit momentum slowdown does not change the medium-term growth thesis. BofA lowered 2026E EPS from CNY9.08 to CNY8.65 and reduced 2026E EBITDA from CNY12,311.3mn to CNY11,849.2mn, but kept 2027-2028E earnings largely unchanged. The report maintains a CNY455 target price and BUY rating, emphasizing the company’s leading position in the Nvidia AI server PCB supply chain, and its ability to diversify Rubin Ultra backplane delay risk by expanding U.S. ASIC customers, domestic customers, and optical module customers.

Analysis framework

The report uses earnings forecast revisions, platform PCB value comparison, forward P/E valuation, and peer valuation-range comparison. The earnings forecast reflects a slower Q2 and recovery in Q3 and Q4 at a quarterly pace. The target price is based on 30x 2027E P/E, with the rationale that the company is in a strong earnings cycle, business visibility has extended, the customer base is more diversified, and the company has a leading industry position.

Methodology notes

• Valuation methodsforward_p_e

  30x 2027E P/E

  The CNY455 target price is based on a 30x 2027E P/E, about 0.5 standard deviations above the company’s 10-year average trading level, and sits at the higher end of the valuation range for China AI server PCB peers in 2027E.

• earnings_forecastearnings_revision

  2026E earnings reduced by 6%

  BofA revised 2026E earnings down by 6% to reflect potential Q2 deceleration while keeping 2027-2028E earnings forecasts broadly unchanged.

• industry_comparisonplatform_content_value

  VR200 content value is about three times that of GB200/300

  The report compares PCB specifications and value content across Nvidia H100, GB200/GB300, VR200, and Rubin Ultra platforms to show the higher value uplift from platform upgrades.

• quality_and_financial_metricsiQmethod

  BofA iQmethod framework

  The report cites BofA Global Research's iQmethod framework, covering operating performance, earnings quality, and valuation validation metrics.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Victory Giant Technology / 300476.SZ

  Core covered name

  Strengths

  Leading in Nvidia AI server PCB, with strong HDI, HLC, and mSAP capabilities, and diversified customer expansion underway.

  Weaknesses

  Q2 is pressured by delayed platform ramp-up and traditional FR-4 cost pressure, leading to slower short-term profit momentum.

  Comparison

  Currently around 26x one-year forward P/E, close to the historical average; the target valuation of 30x 2027E P/E is in a relatively high peer range.

  Risks

  AI cloud capex in China/Asia below expectations, slower-than-expected GPU platform upgrades, share loss to competitors, supply-chain bottlenecks, and worsening U.S.-China tensions.

• Nvidia AI server PCB supply chain

  Primary growth driver

  Strengths

  VR200 and Rubin Ultra platforms increase PCB layer count, material specifications, and value content.

  Weaknesses

  Rubin Ultra backplane onboarding is still in testing, and final specifications remain uncertain.

  Comparison

  The report estimates VR200 PCB value content is about three times that of GB200/GB300, with Rubin Ultra potentially higher.

  Risks

  Slower platform upgrade pace or delayed backplane adoption could affect order ramp-up.

Key data

• RatingBUYThe report reiterates a Buy rating.
• Target priceCNY455.00Based on 30x 2027E P/E.
• Current priceCNY319.55Price disclosed in the report.
• 2026E EPSCNY8.65Revised down from the previous CNY9.08.
• 2027E EPSCNY15.10Kept broadly unchanged, previously CNY15.11.
• 2026-2028E Earnings CAGR66%Model forecast in the report.
• 2026E Net profitCNY8,267mnRevised net profit forecast.
• 2027E Net profitCNY14,844mnRevised net profit forecast.
• 2028E Net profitCNY22,718mnRevised net profit forecast.
• 2026E P/E36.9xDisclosed in valuation table.
• 2027E P/E21.2xDisclosed in valuation table.

Impact & implications

If Vera Rubin platform and high-layer TPU orders ramp up smoothly starting in Q3, the company’s earnings growth and valuation support is expected to recover; if the confirmation or onboarding of Rubin Ultra backplane specs is delayed, near-term market concerns may persist. The report believes customer diversification, advanced PCB process capability, and expansion readiness can partially mitigate single-platform uncertainty.

Risks

• Global AI cloud capex comes in below expectations.
• GPU platform upgrades are slower than expected.
• The company loses significant market share to competitors.
• Supply-chain bottlenecks limit server rack shipments.
• U.S.-China tensions worsen.
• Rubin Ultra backplane adoption or specification confirmation is delayed.
• Traditional businesses are pressured by FR-4 price increases and e-glass shortages, with margins under pressure.

What to watch

• The ramp-up pace of Vera Rubin platform in Q3 and release of high-value orders.
• Progress on launching higher-layer TPU PCB orders.
• Final Rubin Ultra backplane specs, test progress, and onboarding timeline.
• Advances in expansion among U.S. ASIC customers, domestic customers, and optical module customers.
• Changes in AI server PCB peer valuations and the company’s one-year forward P/E.
• The impact of FR-4 and CCL cost pressure on traditional business gross margins.