Goldman Sachs Maintains Victory Giant at Buy on AI PCB Demand and Capacity Expansion Support Growth

Overview

This report is Goldman Sachs' management visit note on Victory Giant, focusing on AI PCB business migration, AI server demand growth, and the company's capacity expansion and R&D capabilities. Goldman Sachs believes that global AI infrastructure buildout, AI PCB layer-count and specification upgrades, higher PCB substitution for copper cables in AI servers, and expansion of GPU and ASIC customers will continue to support the company's growth.

Core views

Goldman Sachs maintains a positive view and a Buy rating on Victory Giant. The report says the company has strong R&D capabilities and can co-develop the latest AI PCBs with customers; meanwhile, timely capacity expansion helps capture demand when new technologies enter the mass-production window. Management also noted that demand from local AI server customers is stronger than expected, and optical module PCBs and advanced packaging PCBs may bring additional growth opportunities.

Analysis framework

The report mainly uses management interviews, demand-trend judgment, capacity and R&D capability assessment, and relative valuation methods. The valuation section is based on 2027E EPS and applies a 26.3x target P/E to derive a 12-month target price of Rmb550; the target P/E is based on the correlation between the company's peer P/Es and EPS growth, and also references the company's 2028E EPS YoY growth.

Methodology notes

• Valuation methodsTarget P/E valuation

  Derive target price by multiplying forecast EPS by the target P/E

  Goldman Sachs applies a 26.3x target P/E to 2027E EPS to derive a 12-month target price of Rmb550. The target P/E is based on the correlation between Victory Giant's peer P/Es and EPS growth, and also references the company's 2028E EPS YoY growth.

• Factor frameworkGS Factor Profile

  Compare stock characteristics across growth, financial returns, valuation multiples and composite metrics

  Goldman Sachs' factor profile measures growth using forward sales, EBITDA and EPS growth; financial returns using ROE, ROCE and CROCI; valuation multiples using P/E, P/B and EV/EBITDA; and produces a composite percentile.

• M&A frameworkM&A Rank

  Assess the probability of a company becoming an acquisition target on a scale of 1 to 3

  In Goldman Sachs' M&A ranking, 1 indicates a relatively high probability of being acquired, 2 indicates a medium probability, and 3 indicates a low probability. The report materials show Victory Giant's M&A Rank as 3.

Asset mapping & comparison

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

• Victory Giant / Victory Giant (300476.SZ)

  Covered company in the report, core beneficiary

  Strengths

  Strong demand for AI PCBs; coverage of GPU and ASIC AI server customers; strong R&D capability; timely capacity expansion; a high degree of automation in production lines and warehouse management; expanding into optical module PCBs and advanced packaging PCBs.

  Weaknesses

  Growth realization depends on AI server demand, specification upgrades and capacity ramp-up; the report does not provide more granular customer concentration or order visibility data.

  Comparison

  Goldman Sachs derives the target P/E from the correlation between peer P/Es and EPS growth, believing the company's growth outlook supports a relatively high target valuation.

  Risks

  AI server shipment ramp-up slower than expected; AI server PCB specification upgrades slower than expected; market competition stronger than expected.

• AI PCB industry chain

  Main source of the company's growth drivers

  Strengths

  Global AI infrastructure buildout is increasing server PCB demand, specification upgrades are driving higher layer counts and value per server, and substitution of copper cables by PCBs in AI servers may also increase demand.

  Weaknesses

  Industry momentum depends on AI server capex and the mass-production pace of customers' new platforms.

  Comparison

  Demand from local AI server customers is described by management as stronger than expected, providing an additional source of demand beyond global leading customers.

  Risks

  Volatility in end-demand for AI servers, changes in technology routes, or delays in customer qualification timelines.

Key data

• 12-month target priceRmb550.00Goldman Sachs target price, based on 2027E EPS and a 26.3x target P/E.
• Current priceRmb334.20Current price in the report chart.
• Implied upside64.6%Calculated from target price relative to current price.
• Market capRmb290.9bn / $42.8bnReport financial summary table.
• Enterprise valueRmb301.8bn / $44.4bnReport financial summary table.
• 2026E revenueRmb36,533.8mnForecast in the report.
• 2027E revenueRmb64,882.5mnForecast in the report.
• 2028E revenueRmb87,985.2mnForecast in the report.
• 2027E EPSRmb20.80Key forecast basis for target price valuation.
• 2028E EPSRmb27.58Forecast in the report and used as a reference for EPS growth.
• 2027E P/E16.1xReport financial summary table.
• 2028E P/E12.1xReport financial summary table.

Impact & implications

If AI server shipments, PCB specification upgrades and the expansion of the local AI ecosystem continue, Victory Giant may benefit simultaneously from demand volume growth, higher PCB value per server, and customer expansion. The company's capacity expansion and R&D cadence are key to whether it can deliver growth, and Goldman Sachs' target price shows its optimism about future earnings growth and valuation support.

Risks

• AI server shipment ramp-up slower than expected.
• AI server PCB specification upgrades slower than expected.
• Market competition stronger than expected.
• If capacity expansion or new-technology mass production progresses more slowly than expected, the company's ability to capture demand growth could weaken.

What to watch

• Order flow and mass-production pace for GPU and ASIC AI server customers.
• Progress in AI PCB layer counts, specifications and value per server.
• Whether demand from local AI server customers remains stronger than expected.
• Ramp-up of new capacity, yields and production-line automation efficiency.
• Whether expansion into optical module PCBs and advanced packaging PCBs can generate material revenue contributions.
• Delivery of 2026E to 2028E revenue, EPS and cash flow forecasts.