Victory Giant joins IPO push by China’s circuit-board makers amid AI frenzy

The burgeoning artificial intelligence sector is fueling a surge in demand for printed circuit boards (PCBs), positioning them as the latest hot commodity in China's technology supply chain. Companies are capitalizing on this global demand for AI infrastructure by pursuing initial public offerings (IPOs), with Victory Giant Technology leading the charge.

Victory Giant Technology, a notable supplier to U.S. chip giant Nvidia, has initiated its bookbuilding process in Hong Kong for an IPO projected to raise as much as HK$17.49 billion (US$2.2 billion). This offering stands to be the largest in Hong Kong this year, serving as a significant test of market sentiment amidst global geopolitical conflicts and heightened regulatory scrutiny of IPOs by mainland China and Hong Kong authorities.

The strong performance of the AI infrastructure market has created a 'gold rush' for high-end circuit boards, with projections indicating sustained growth beyond 2026. PCBs, often overlooked as basic components, are now recognized for their critical role in the complex interconnectivity required for advanced AI servers and data center switches.

This trend is further evidenced by other domestic PCB suppliers. Jiangxi Redboard Technology recently listed in Shanghai, raising 1.8 billion yuan (US$263.4 million) for capacity expansion. Additionally, Zhongji Innolight, another mainland supplier to Nvidia, is reportedly preparing a confidential application for a Hong Kong listing, aiming to raise at least US$3 billion. Analysts like Kenny Ng Lai-yin of Everbright Securities International note that the current momentum in the PCB sector is expected to persist for one to two years due to supply shortages, further underscoring the sector's current prominence.

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PCBs are currently all the rage across the world due to the rapid expansion of AI data centres. Given the shortage of supply, the momentum of the sector is expected to maintain for one to two years.