Citi has released a research report stating that the share price of KB LAMINATES (01888) has fallen about 60% from its historical high this month. The current price-to-earnings ratio is only 8 to 9 times, which is even lower than the historical average (low double digits), suggesting the decline is clearly excessive.

The bank expects KB LAMINATES' net profit for the first half of this year to increase more than three times year-on-year to HK$4 billion. Citi reaffirms its "Buy" rating for the stock, maintaining a target price of HK$130.

Following a conference call after the half-year performance forecast of Nanya New Material (688519.SH), the bank noted key information, including expectations for continued increases in the average selling prices of copper-clad laminates (CCL) and electronic glass cloth in the second half of the year. It also highlighted that the supply shortage of electronic glass fiber cloth is expected to last at least until the end of 2027, and that gross margins in the second half will expand significantly compared to the first half.

Citi believes this conference call provides a positive signal for the CCL industry, including KB LAMINATES.