Goldman Sachs maintains Buy on WUS, positive on AI PCB demand and capacity expansion

Overview

This report is a company research update from Goldman Sachs following a management meeting with WUS during its Shanghai China technology trip. The core conclusion is that the upcycle in AI infrastructure, upgrades in AI server PCB specifications, rising PCB content within server racks, and WUS's continued high-end capacity expansion will together support the company's shipment growth and product mix upgrade; Goldman Sachs therefore maintains a Buy rating.

Core views

Goldman Sachs believes WUS's growth does not rely solely on simple capacity expansion at high utilization, but instead screens new capacity directions based on end demand, technical readiness, and product quality. AI server demand, higher ASIC penetration, upgrades in materials and layer counts required for high-speed connectivity, and higher PCB content in connectivity scenarios such as midplane, backplane, and CoWoP constitute the company's medium-term growth logic.

Analysis framework

The report analyzes management interviews, assumptions on AI server and AI chip growth, ASIC penetration, global PCB TAM forecasts, the company's capex trend, and the relationship between peer P/E multiples and EPS growth, and derives the 12-month target price from the target P/E applied to 2027E EPS.

Methodology notes

• Valuation methodsTarget P/E method

  23x 2027E P/E

  Goldman Sachs derives the 12-month target price by applying a 23x 2027E P/E, based on the relationship between peer P/E multiples and EPS growth and on WUS's expected 2027-2028 EPS growth.

• Factor analysisGS Factor Profile

  Growth, financial returns, valuation multiples, and composite factors

  The Goldman Sachs factor framework compares the covered stock with industry peers, standardizes and converts sales, EBITDA, and EPS growth, ROE, ROCE, CROCI, as well as P/E, P/B, EV/EBITDA and other metrics into percentiles to provide stock investment context.

• Scenario and industry demandAI infrastructure and PCB TAM analysis

  AI servers, ASIC penetration, PCB specification upgrades, and in-rack connectivity demand

  The report uses growth in implied AI chips in AI servers, higher ASIC penetration, material and layer upgrades, and increased connectivity scenarios within server racks to explain the expansion in AI PCB demand and the company's room for product mix upgrade.

Asset mapping & comparison

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

• WUS Printed Circuit Co., Ltd. / WUS (002463.SZ)

  Core coverage stock

  Strengths

  Benefits from AI server PCB demand, specification upgrades, rising connectivity scenarios in server racks, and high-end capacity expansion.

  Weaknesses

  Capacity expansion must continue to match technical readiness, product quality, and end demand; if new capacity conversion efficiency is insufficient, revenue growth may fall short of expectations.

  Comparison

  Valuation uses the relationship between peer P/E multiples and EPS growth, and the 23x target P/E is supported by expected 2027 EPS growth.

  Risks

  Slower-than-expected migration to high-end AI servers and high-speed switches, more intense-than-expected competition in the AI PCB market, and slower-than-expected new capacity expansion.

• Global AI PCB supply chain

  Demand driver

  Strengths

  The AI infrastructure upcycle, higher ASIC penetration, material and layer upgrades, and greater PCB content in scenarios such as midplane and backplane all increase PCB usage.

  Weaknesses

  Industry growth is highly dependent on the pace of AI server investment and migration to high-end specifications.

  Comparison

  Goldman Sachs expects global PCB TAM value to grow 113%/171% y/y in 2026/2027, showing that AI-related PCBs have higher growth elasticity than traditional PCBs.

  Risks

  If AI server deployment, chip growth, or high-speed switch migration slows, industry TAM expansion may underperform expectations.

Key data

• Report date2026-05-23Goldman Sachs equity research report, published at 1:21 AM Hong Kong time on 2026-05-23.
• RatingBuyThe report explicitly states a maintained Buy rating.
• 12-month target priceRmb142Based on 23x 2027E P/E.
• Disclosed priceRmb114.07The company-specific disclosure lists WUS price at Rmb114.07.
• Implied AI chip growth2026E y/y +49%; 2027E y/y +31%Goldman Sachs' assumption for implied AI chip growth in AI servers.
• ASIC penetration2026E 40%; 2027E 50%The report believes higher ASIC penetration will drive AI infrastructure-related PCB demand.
• Global PCB TAM value growth2026E y/y +113%; 2027E y/y +171%Goldman Sachs believes this trend benefits WUS's growth and product mix upgrade.
• Capex change4Q25 q/q +53%; 1Q26 q/q +34%Reflects stronger capacity expansion commitment.
• 2026 capex forecastRmb6bnGoldman Sachs expects 2026 capex of about Rmb6bn, above 2025's Rmb3bn, and expects it to remain elevated through 2028.

Impact & implications

If Goldman Sachs's views on AI servers, ASIC penetration, and global PCB TAM materialize, WUS may benefit from growth in high-end AI PCB shipments, improved product mix, and better revenue quality. The company's capacity expansion strategy emphasizes the alignment of demand, technology, and quality, which helps reduce the risk of inefficient capacity caused by simply chasing utilization.

Risks

• Slower-than-expected migration to high-end AI servers and high-speed switches.
• AI PCB market competition becoming more intense than expected.
• Slower-than-expected expansion of new capacity.
• Sustained high capex may create pressure on capacity conversion, utilization, and cash flow.

What to watch

• Whether implied AI chip growth in AI servers approaches the 2026E +49% and 2027E +31% assumptions.
• Whether ASIC penetration can rise to 40%/50% in 2026/2027.
• Whether WUS's new capacity is concentrated in non-commodity products with strong demand, sufficient technical readiness, and assured quality.
• Execution progress on about Rmb6bn of capex in 2026 and elevated capex through 2028.
• AI PCB market competition, pricing pressure, and the degree of product mix upgrade.
• Actual demand changes in connectivity scenarios such as high-end AI servers, high-speed switches, midplane, backplane, and CoWoP.