Citi has released a research report highlighting potential earnings upside for KB Laminates (01888) amid a persistent shortage of AI-related materials, assigning a "Buy/High-Risk" rating with a target price of HK$95. The brokerage believes the company can leverage its high-quality and vertically integrated advantages to secure AI-CCL testing certifications from major GPU and CSP players in the U.S. and China.

Citi recently engaged with KB Laminates management to discuss developments in the upstream glass fiber cloth and copper foil segments of the AI-CCL supply chain. The report notes that electronic glass fiber cloth currently faces a critical bottleneck in loom supply, with expectations of continued heavy reliance on Toyota Industries (6201.JP) over the next two years, as the latter commands over 80% of the global high-end loom market.

Additionally, since AI power-related PCBs require 3oz thick copper foil—compared to the traditional 1oz used in standard FR4—production becomes more time-consuming. As a result, Citi anticipates that copper foil could emerge as another bottleneck in the supply chain. Within China's AI infrastructure space, Citi's preference ranking places KB Laminates first, followed by Shengyi Technology (600183.SH) and Han's Laser Technology Industry Group (002008.SZ).