Analysis of Pegatron Holdings' Thailand Expansion Project and Customer Concentration

Pegatron Holdings (002938.SZ), a global PCB leader, achieved operating revenue of 26.855 billion yuan and net profit attributable to shareholders of 2.408 billion yuan in the first three quarters of 2025, representing a year-on-year increase of 21.95%[1]. The company has invested a total of 9.238 billion yuan in R&D over the past five years, demonstrating strong technological innovation capabilities[1]. From the perspective of financial indicators, the company currently has a PE of 29.35x, PB of 3.64x, ROE of 12.60%, and net profit margin of 10.53%, with an overall stable financial condition[0].

According to the latest data, Pegatron Holdings generated operating revenue of 13.079 billion yuan in the U.S. region in the first half of 2025, accounting for 79.87% of total revenue[1]. This indicates that the company faces a severe customer concentration issue, with major customers concentrated in the North American market, especially U.S. tech giants. This highly concentrated customer structure brings the following risks:

1. Single Market Dependence
   : The company’s revenue is overly dependent on the U.S. market
2. Customer Bargaining Power
   : Large customers have strong bargaining power, which may compress profit margins
3. Geopolitical Risks
   : Sino-U.S. trade frictions may affect the stability of the company’s business

On December 15, 2025, Pegatron Holdings announced plans to invest 4.297 billion yuan in the construction of a Thailand park, with the project cycle covering the entire year of 2026[1]. The main construction contents include:

• Production plants and supporting facilities
• Deployment of production capacity for high-end HDI (including SLP), HLC, and other products
• Expansion of AI-related PCB product capacity

The Thailand factory will focus on PCB products for AI servers, optical modules, automotive applications, etc., serving the entire AI "cloud-pipe-device" industrial chain[1]. From the perspective of industrial chain layout, the PCB products produced by the Thailand factory will first be delivered to downstream assembly plants in China and other Asian regions, then integrated into terminal equipment and sold to the U.S. through the assembly plants’ global sales channels[1].

From the industrial chain analysis, the Thailand expansion project

:

1. Unchanged Sales Path
   : Products are still ultimately sold to the U.S. market through assembly plant channels, so the customer structure has not changed in essence[1]
2. Capacity Ramping Cycle
   : The Thailand factory is expected to start production in H2 2025 and complete construction in 2026, so its contribution to performance will be limited in the short term[3]
3. Customer Development Cycle
   : New customer onboarding requires a long certification cycle, making it difficult to quickly diversify customer concentration

Although the short-term effect is limited, the Thailand project has important long-term strategic significance:

1. Improved Global Layout
   : Aligning with the industry trend of PCB industry transfer to Southeast Asia, Prismark predicts that the PCB scale in Asia (excluding China and Japan) will reach 30.4 billion U.S. dollars by 2028, with a CAGR of 8% from 2023 to 2028[2]
2. Geopolitical Risk Avoidance
   : Building a factory in Thailand can effectively avoid potential trade barriers and tariff risks
3. Emerging Market Development
   : The development of Southeast Asia and other Asian markets lays the foundation for future customer diversification

1. Persistent Customer Dependence Risk
   : After the project is implemented, the customer concentration issue may still persist
2. Investment Return Cycle
   : The 4.297 billion yuan investment will take a long time to generate returns
3. Intensified Industry Competition
   : Peers such as Wus Printed Circuit, Dongshan Precision, and Shenghong Technology are also expanding in Southeast Asia, increasing competitive pressure[2]

The Thailand expansion project of Pegatron Holdings

, but it has important significance from a long-term strategic perspective. The company should seize the development opportunities of the AI industry, actively explore customers in Europe and other Asian regions while expanding production, and gradually reduce its over-reliance on the U.S. market. It is recommended to continue to pay attention to changes in the company’s customer structure and the progress of new customer expansion.

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[1] Sina Finance - Pegatron Holdings Invests 4.3 Billion Yuan to Build Factory in Thailand to Expand AI Capacity and Layout Entire Chain, Spends Nearly 10 Billion Yuan on R&D in Five Years (https://finance.sina.com.cn/roll/2025-12-17/doc-inhcaekp2514409.shtml)

[2] Eastmoney.com - AI-Driven + Industry Transfer, PCB Exposure Equipment Benefits (https://pdf.dfcfw.com/pdf/H3_AP202409301640099295_1.pdf)

[3] Eastmoney.com - Pegatron Holdings (002938) Research Report (https://pdf.dfcfw.com/pdf/H3_AP202408161639300702_1.pdf)