Avary advances expansion at its Prachinburi base in Thailand, with AI server and optical module PCB as core incremental growth themes

Overview

This report is from Goldman Sachs' Thailand/Vietnam Tech Trip and reviews Avary's PCB plant in Prachinburi, Thailand. The report focuses on progress of Thai capacity expansion, product and technology capabilities, location strategy, and smart manufacturing and sustainable energy setup. Avary is a subsidiary of ZDT, which holds a controlling majority equity interest of 70%-80%; ZDT is described as the global leading PCB supplier, ranked No. 1 by revenue market share at around 7%-10%.

Core views

The core view is that Avary's Thailand base is advancing from phase-one mass production to multi-park expansion, with new capacity in coming quarters contributing server PCB, optical module PCB, and smart device PCB capability. Thailand factory technology capability is described as approaching that of major mainland China facilities, covering processes including HDI, HLC, SMA, and FPC/FPCA. Prachinburi is close to the EEC, airports, ports, suppliers, and ODM customers, and with support from SAHA Group in land, water, electricity, labor resources, local relationships, and government relations, it is well positioned to support global customers' diversified manufacturing location needs.

Analysis framework

The report uses on-site research and management discussions, covering capacity planning, factory automation, production technology, supply-chain location, and sustainability, and cross-validates company-level Thailand expansion with AI servers, optical modules, high-speed switches, PCB/CCL spec upgrades, and supply-chain earnings resilience.

Methodology notes

• equity_researchsite_visit_read_across

  On-site research and industry chain mapping

  Observed capacity, technology, automation, and location conditions through plant visits and management discussions, then mapped conclusions to the AI infrastructure cycle, server PCB, optical module PCB, and changes in PCB/CCL demand.

• equity_researchGS Factor Profile

  Goldman Sachs Factor Profile

  The disclosure appendix states that the GS Factor Profile compares stocks against the market and industry peers across Growth, Financial Returns, Multiple, and Integrated attributes, but this report does not provide specific factor values for Avary in the main body.

• equity_researchM&A Rank

  M&A probability framework

  The disclosure appendix states that Goldman Sachs uses a 1-to-3 M&A Rank to assess a company's probability of becoming an acquisition target; this report does not provide a specific M&A Rank for Avary.

Asset mapping & comparison

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

• Avary / 002938.SS

  Research subject; ZDT-controlled subsidiary; Thailand PCB expansion platform

  Strengths

  The expansion plan for six production sites in Prachinburi is clear; technology covers server PCB, optical module PCB, smart device PCB, and multiple PCB processes; automation coverage is over 80% and quality monitoring is 100%; proximity to the EEC, airport, port, suppliers, and ODM customers.

  Weaknesses

  Marked as Not Covered, with no rating, target price, earnings forecast, or valuation framework provided; several sites remain under construction or planning, so capacity contribution is still awaited.

  Comparison

  Thailand factory technology is described as close to major mainland China bases; as part of the ZDT platform, it jointly supports global customer location diversification together with production bases in mainland China, Taiwan, and India.

  Risks

  Delay in construction and pilot-production ramp schedules, AI server or optical module demand below expectations, customer approvals and certification slower than expected, local execution and supply-chain readiness risk in Thailand, and risks that renewable energy and sustainability commitments may not be fully delivered.

• ZDT

  Avary controlling shareholder and global PCB platform

  Strengths

  Holds a 70%-80% majority stake in Avary; described as the world's top PCB supplier by revenue share at around 7%-10%; has developed ABF substrate business in Shenzhen since 2023.

  Weaknesses

  The report does not provide ZDT financial forecasts or valuation details.

  Comparison

  The report states ZDT has the highest China-market ABF revenue exposure among ABF substrate peers.

  Risks

  Volatility in the AI infrastructure cycle, ABF substrate competition, execution of capacity expansion, and changes in customer demand.

• PCB/CCL leaders

  Beneficiaries in the AI infrastructure upcycle chain

  Strengths

  AI servers and high-speed switches drive specification upgrades, while AI PCB and CCL carry higher ASPs and margins.

  Weaknesses

  Earnings depend on AI server demand, CSP capex, and customer order execution.

  Comparison

  The report cites Buy names including ZDT, Victory Giant, WUs, Shengyi Tech, and Shennan Circuits.

  Risks

  CSP capex below expectations, pricing competition, raw material cost volatility, and capacity overhang.

Key data

• ZDT ownership stake70%-80%Avary is a ZDT subsidiary, and ZDT holds majority controlling equity.
• ZDT global PCB market share7%-10%The report says ZDT is the global leading PCB supplier, ranked first in revenue market share.
• Number of Thailand production bases6Avary has six production sites in Prachinburi.
• PA01 mass production date3Q25PA01 is for mass production of server and optical module PCB.
• PA06 pilot target4Q26PA06 targets pilot production for server PCB.
• PA02 pilot target1Q27PA02 is for server and optical module PCB.
• PA03 pilot target2Q27PA03 is for smart device PCB.
• Total construction areaabout seven times phase oneManagement uses this metric to reflect Thailand expansion commitment.
• Automation coverageover 80%Thailand campus is a highly automated intelligent factory.
• Quality monitoring coverage100%The report states factory quality monitoring is at 100%.
• Location and transportabout two hours drive to Bangkok Suvarnabhumi Airport; about 2.5 hours drive to Laem Chabang PortPrachinburi base is near the EEC, which helps supply-chain and customer connectivity.
• AI chip implied increaseincreased by 14%/22%/14% in 2026-28E, respectivelyFrom report references to Global Server TAM June updates.
• US CSP capex increaseincreased by 8%/27%/25% in 2026-28E, respectivelyUsed to support the AI infrastructure upcycle view.
• China CSP capex increaseincreased by 37%/44%/55% in 2026-28E, respectivelyUsed to support the AI infrastructure upcycle view.

Impact & implications

For the supply chain, the implication is that specification upgrades in AI servers and high-speed switches may raise PCB layer counts, material requirements, and unit value, pushing global AI PCB and CCL demand higher. Because AI PCB and CCL have higher ASPs and margins than mainstream PCB, leading PCB and CCL companies are expected to achieve stronger profit growth over coming years. For Avary, the multi-stage expansion and smart manufacturing capabilities at the Thailand base help meet global customers' needs for location diversification, delivery speed, quality, and sustainability.

Risks

• Avary's Thailand capacity construction, pilot production, or mass production timing may be delayed.
• If demand for AI servers, optical modules, and high-speed switches is weaker than expected, utilization of new PCB capacity could be affected.
• Global customer diversification and certification pace for manufacturing locations could be slower than management expects.
• Although Prachinburi has location advantages, it still faces local labor, energy, water, logistics, and policy implementation risks.
• The higher ASPs and margins of AI PCB and CCL could compress due to increased competition or supply expansion.
• The report is Not Covered on Avary, with no rating, target price, or earnings forecast, limiting quantifiability of the investment conclusion.

What to watch

• Yield rates, capacity ramp, and customer order fulfillment after PA01 enters mass production in 3Q25.
• Pilot or mass production progress for PA06 in 4Q26, PA02 in 1Q27, and PA03 in 2Q27.
• Construction pace and capex schedule for remaining planned sites such as PA05 and PA07 at the Thailand base.
• Whether AI server, optical module, and high-speed switch PCB spec upgrades continue to lift PCB/CCL value per unit.
• Whether raised CSP capex in the US and China translates into actual PCB and CCL orders.
• Whether automation, AMHS, AGV, robotics, and warehousing systems continue to improve quality, speed, scale, and costs.
• The actual contribution of renewable energy and energy-saving processes to carbon footprint reduction and customer ESG requirements.