Entering 5G and striving to dominate the PCB industry, can Xunjiexing stand out?

When it comes to the hottest technology nowadays, many people will think of 5G, autonomous driving technology, etc. In fact, these new technologies are inseparable from a key product – PCB board.

PCB board is a printed circuit board, also known as a printed circuit board, which is the provider of electrical connections for Electronic components. Today, it has been transformed and can be used in communication equipment such as switches, routers, optical transport networks, etc. in 5G networks, as well as in advanced driver assistance systems (ADAS).

Xunjiexing focuses on PCB prototype and small batch board business, and its products are widely used in security electronics, industrial control, communication equipment, medical equipment, automotive electronics, rail transit and other fields.

During the epidemic in the first half of 2020, Xunjiexing products were used in Mindray medical ventilators, monitors, Hikvision thermal imagers, security gates, and Dahua’s infrared human body temperature measurement and detection systems. As a key guarantee enterprise for epidemic prevention and control, Xunjiexing has been included in the Ministry of Industry and Information Technology’s “New Coronary Pneumonia Epidemic Prevention and Control Key Guarantee Enterprise List (Second Batch)”, which shows its industry status.

So, in the promising PCB industry, what are the characteristics of Xunjiexing? How does it stand out on the competitive PCB track?

One-stop service model with distinctive features

Xunjiexing focuses on the R&D and sales of prototypes and small batches of boards. Among them, the model is mainly used in the customer’s research and development stage, which requires high technical level. Batch boards refer to PCB products that have sufficient commercial value and can be mass-produced after passing through the R&D and trial production stages. Batch boards can be divided into small batch boards and large batch boards according to the average single area:

Small batch boards are mainly used in industrial control, automotive electronics, transportation, communication equipment, medical equipment and other fields. Manufacturers customize production according to different customer needs. There are many types of products, but the area of ​​a single order is small, generally no more than 50 square meters.

Compared with high-volume board manufacturers, low-volume manufacturers are similar to customized retailers, so customers are more dispersed, the average order area is smaller, and the order variety is more. This requires higher order response speed, production management, order processing and delivery deadlines for manufacturers.

In this regard, Xunjiexing adopts a unique one-stop service model from sample production to batch board production. With this model, Xunjie Xing can respond to customer needs as quickly as possible, shorten the delivery cycle, help customers improve the efficiency of research and development, reduce the waste of time and resources in intermediate links, and reduce the quality risk caused by order transfer.

At present, Xunjiexing’s main products are various types of printed circuit boards, which can be divided into single-sided, double-sided and multi-layer boards according to the number of layers of conductive patterns. Xunjiexing’s double-sided board has reached the fastest delivery speed within 24 hours, and the multi-layer board can be delivered within 36 hours at the fastest. In 2019, the number of orders was considerable, exceeding 65,000, and the average order area was about 4.7 square meters.

At present, there are few domestic manufacturers specializing in the production of prototypes and small batches of boards; in addition, in recent years, with the vigorous development of 5G communication, cloud computing, big data, Internet of Things, mobile Internet, artificial intelligence and other fields, the PCB industry welcomes to new market demands.

Under this opportunity, Xunjiexing has an obvious first-mover advantage by virtue of its rich management experience and customer resources accumulated over the years. In the future, Xunjiexing will continue to position itself as “multi-variety, small-batch, high-level, and short-delivery”, and will gradually occupy the vacant market with its characteristic one-stop service model.

At present, the demand in the communication electronics industry and the consumer electronics industry is relatively stable, and the new demand in the automotive electronics, medical equipment and other markets is increasing year by year. According to industry forecasts, the output value of the global PCB industry will continue to grow steadily in the next five years. It is expected that the compound growth rate from 2020 to 2024 will be 4.3%, and the output value of the global PCB industry will reach US$75.846 billion in 2024. The core position of the Chinese market will be more stable, and the total output value of the industry will reach US$41.77 billion by 2024.

Although the industry market space is broad, there are currently many domestic printed circuit board companies, and the competition in the industry is fierce. How will Xunjiexing continue its advantages?

Downstream outbreak, expansion is imminent

According to the “19th China Electronic Circuit Industry Ranking List” published by CPCA, Xunjiexing ranked 63rd among the top 100 domestic-funded PCB enterprises. Among them, AT&S, which ranked tenth, had a revenue of 6.5 billion yuan, while Xunjiexing’s revenue in 2019 was 388 million yuan. It is not difficult to find that although Xunjiexing currently has certain manufacturing strength, it is still unable to share the market cake with other well-known manufacturers.

Under such a stark gap, Xunjiexing urgently needs to expand its production capacity. Since the PCB industry is a capital-intensive industry, plant construction, equipment purchase, and production line transformation require a lot of capital investment. Compared with large domestic and foreign PCB companies, Xunjiexing has relatively single financing channels, and it is difficult to effectively convert its competitive advantages into economic output.

Therefore, in this fundraising, Xunjiexing plans to invest nearly 380 million yuan in the project of “annual output of 300,000 square meters of high multi-layer boards and 180,000 square meters of HDI boards”. HDI board has the characteristics of high density, fine wire, and small aperture. The aperture is usually below 0.15mm, the ring diameter of the hole ring is below 0.25mm, the contact density is above 130 points/square inch, and the wiring density is 117. inches/square inch or more.

At present, HDI boards occupy 14.7% of the global PCB subdivision product structure. With the rapid development of technology in the electronic circuit industry, the integrated functions of components are becoming more and more extensive, and the high density requirements of electronic products on PCB are more prominent. According to Prismark’s forecast, the compound growth rate of HDI boards from 2019 to 2024 is 5.9%, leading the PCB industry.

Secondly, the country has issued a series of policies in recent years to promote the research and development and industrialization of key technologies in the fields of “printed electronics”. This project not only conforms to the country’s industrial planning and policy orientation, but also has broad market prospects, which can ensure the digestion of new production capacity.

In addition, the field of 5G communication is also the key area of ​​Xunjiexing’s future layout. The company’s products are mainly used in base stations, antennas, memory, optical modules, etc. At the same time, the company will build a PCB production base with a higher level of automation, a more optimized process, a more scientific layout, a better management, and a more international level, so that the bottleneck of production capacity and site space can be fully alleviated in the medium and long term, providing the company Rapid business growth provides a solid guarantee.

Overweight R&D to encourage independent innovation

Xunjiexing has invested a lot in research and development, and it has a technical center team with advanced concepts, comprehensive technologies, outstanding capabilities and rich practical experience. As of March 31, 2020, the company’s technology center has a total of 133 people, serving the company’s new product development and process technology research, as well as providing customers with customized engineering solutions.

The R&D investment of Xunjiexing in the past three years was 19.7191 million yuan, 28.0229 million yuan and 29.2272 million yuan respectively, with a total investment of 76.9692 million yuan; and the proportion of the company’s R&D investment in the operating income in the last three years was 7.26%, 7.45% and 7.53%, all exceeding 5%.

With Xunjiexing’s unremitting investment in research and development, its team has developed a number of core technologies that are pioneered by domestic counterparts.

Not only that, Xunjiexing’s product revenue using core technologies accounts for a large proportion of the company’s main business revenue, accounting for 88.05%, 90.72% and 90.54% respectively from 2017 to 2019. Most of Xunjiexing’s products are independently developed, so they are exclusively sold, and the products are highly competitive.

On the basis of solid research and development strength, Xunjiexing encourages employees to innovate independently. It has formulated the “Patent Incentive Measures” and the “Rationalization Proposal and Incentive Management System”, which stipulates that in addition to wages and salaries, employees who successfully apply for various patents will be paid according to the The level of contribution gives different amounts of rewards.

In the rapidly changing technological trend, Xunjiexing keeps pace with the times and tracks customer and industry needs in a timely manner. After more than ten years of development, it has established long-term and stable cooperative relations with many well-known enterprises, and established a good brand image in the fields of security electronics, medical equipment, communication equipment, and rail transit.

At present, Xunjiexing has successfully passed the initial stage of PCB prototype business and successfully completed the evolution to “one-stop service model from prototype to mass production”. The improvement of production management capabilities and the promotion of large-quality system improvements have laid a solid foundation for the company to realize PCB intelligent manufacturing in the future.

Since 2020, Xunjiexing has accelerated to enhance the competitiveness of the company’s products. In the future, Xunjiexing will continue to further strengthen its product competitiveness by enriching product categories, improving product levels, and enhancing the level of special process technology, and gradually stand out in the highly competitive PCB industry.