Han's Laser quietly making big profits

Author: Zheng Chenye

Cover image: Tuochuang Creative

Take apart any electronic device—inside, you can find one or several green circuit boards. Components such as chips, resistors, capacitors, and others are soldered onto them, while the traces on the board are responsible for transmitting signals between them.

This board is called a printed circuit board, and in the industry it’s abbreviated as PCB. It’s in phones, in cars, and also in AI servers—though the AI servers require more PCB layers and higher precision.

Before a PCB leaves the factory, it has to go through several processing steps. One of them is called drilling, which means punching micro-sized through holes in the board so that electrical signals can be transmitted between different wiring layers.

The business that Han’s Laser CNC (301200.SZ / 03200.HK) is engaged in mainly involves making drilling equipment like this for PCB factories.

On the evening of March 30, this A-share PCB-dedicated equipment manufacturing industry leader released its 2025 annual report. The annual report shows that in 2025, Han’s Laser CNC achieved operating revenue of RMB 5.77B, up 72.68% year over year; net profit attributable to shareholders of the listed company was RMB 824 million, up 173.68% year over year; and net profit after deducting non-recurring gains and losses was RMB 821 million, up 290.92% year over year.

This is the best annual report since Han’s Laser CNC was established. Judging from quarterly data, performance also accelerated quarter by quarter: first-quarter net profit of RMB 117 million, second-quarter RMB 146 million, third-quarter RMB 228 million, and fourth-quarter reached RMB 333 million; the money earned in the fourth quarter was even more than the total for the first half.

In fact, when Han’s Laser CNC listed on the ChiNext board in early 2022, it just happened to coincide with the global PCB industry’s deepest downturn in nearly 20 years. Specifically, according to market research firm Prismark, in 2023, all global sub-segment PCB products saw significant declines, with an average drop of 15%.

Han’s Laser CNC’s net profit attributable to the parent company fell by nearly 40% in the year of its listing, and in 2023 it further declined to RMB 136 million. Its performance and share price also moved in tandem: on February 28, 2022, on its first trading day after listing, Han’s Laser CNC opened at RMB 70.08 per share; it broke below the issue price the same day, closing at RMB 60.56 per share. After that, the share price fell steadily, reaching a low of RMB 26.49 per share during intraday trading on September 18, 2024.

Then, as the industry warmed up, the company’s performance began to reverse, and the share price rose along with it: in 2025, Han’s Laser CNC’s A-share gain was 231.68%; as of the close on March 30, 2026, the share price was RMB 176.17 per share, with a total market capitalization of RMB 85.2 billion.

In this record-setting annual report from Han’s Laser CNC, one structural feature stands out: the company’s drilling-related equipment generated revenue of RMB 4.17B for the full year, accounting for 72.19% of total revenue.

Seventy percent of revenue from one process

Drilling may seem simple—just drilling holes in a PCB board—but the technical barriers are not low.

A single PCB may have thousands or even tens of thousands of holes. Each hole’s position, depth, and hole-wall quality have strict requirements.

For hole diameters above 0.15 millimeters, mechanical drill bits are used; below 0.15 millimeters, laser drilling is used. A 0.15-millimeter diameter is about as thick as two strands of hair. If the hole is off-target or the hole wall becomes rough, signal transmission will run into problems.

More than 70% of Han’s Laser CNC’s revenue in 2025 comes from this process. The question is: why is it drilling that earns the most money among the six processes?

The answer is related to AI.

PCBs usually have more than one layer. Multiple layers of wiring are stacked together; the more layers, the more signal pathways the PCB can carry, but the workload and difficulty of drilling also increase exponentially.

A typical smartphone PCB has about 8 to 10 layers. AI-server PCBs are different: to carry higher-speed data transmission, the number of layers increases substantially—often 18 layers or more, and some products already exceed 20 layers.

With more layers, there are more holes to drill, the board is thicker, and drilling becomes even more difficult. In its annual report, Han’s Laser CNC puts it as: “For AI PCB products of the same area, the number of equipment required increases significantly.”

Prismark data shows that in 2025, the market for multilayer boards of 18 layers and above associated with AI servers grew by more than 50%. The growth rate of high-multilayer HDI boards was even higher, reaching 99.2%. Meanwhile, the global PCB industry’s revenue scale in 2025 reached USD 84.9 billion, up 15.4%. Among them, the fastest-growing PCB segments are those related to AI servers and data storage, with a growth rate as high as 46.3%.

In addition, another reason for the growth in demand for drilling equipment can be seen from Han’s Laser CNC’s annual report.

During the transmission of high-speed signals, requirements for signal integrity are very high. After through-hole drilling, another step called back drilling is also required—to remove the excess copper pillars inside the holes to prevent signal reflections. This process has extremely high precision requirements.

The annual report discloses that Han’s Laser CNC’s CCD six-axis independent mechanical drilling machine is equipped with its own patented 3D back drilling and drilling-and-measurement integrated functions. It can control the residual stubs in back-drilled holes to within 0 to 100 micrometers. As the number of holes requiring back drilling in AI-server PCBs keeps increasing, demand for this kind of high-precision equipment is also rising rapidly.

The annual report shows that in 2025 Han’s Laser CNC sold 7,143 units of equipment, up 58.38% year over year; it produced 7,374 units for the full year, up 70.93% from the prior year; revenue from drilling-related equipment was RMB 4.17B, up 98.38% year over year—nearly doubling.

Among them, the CCD six-axis independent mechanical drilling machine is the product with the highest unit value in a single machine. The annual report discloses that this product has completed processing qualification for the next-generation AI-server PCB and has achieved mass production at multiple leading PCB companies.

Sales are rising, and profit margins are improving as well.

In 2024, Han’s Laser CNC’s overall gross margin was 28.11%, the lowest point since its listing. In interviews with the media, the company said that the decline in gross margin was mainly due to product mix: drilling equipment is a relatively mature product, with intense market competition.

But in 2025, Han’s Laser CNC’s overall gross margin rebounded to 35.12%, an increase of 7 percentage points. The gross margin of drilling-related equipment also rose from 24.73% to 33.45%. The reason is that the share of revenue from CCD back-drilling machines—which have higher value—has continued to increase within drilling equipment revenue.

Even among drilling equipment, back-drilling machines sell at a higher price than ordinary mechanical drilling machines, and they also bring thicker profits. This explains why Han’s Laser CNC’s net profit growth rate in 2025 was 173.68%, far higher than the revenue growth rate of 72.68%.

The customer list disclosed in Han’s Laser CNC’s annual report nearly covers the major PCB manufacturers at home and abroad: Shenghong Technology (300476.SZ), Shenzhen NanYa Circuit (002916.SZ), Shandong Zhenjiang? (002463.SZ) [Note: likely “沪电股份(002463.SZ)”], Dongshan Precision (002384.SZ), Unimicron? (臻鼎科技), Unitech Electronics (欣兴电子), and others.

In terms of geographic distribution, South China is the region where Han’s Laser CNC’s growth was strongest in 2025.

The annual report shows that the South China region achieved full-year revenue of RMB 3.27B, up 132.10% year over year, accounting for 56.69% of total revenue. Expansion of AI PCBs is highly concentrated in PCB hub areas such as Huizhou, Guangdong and Shenzhen, and Han’s Laser CNC’s headquarters is also in Bao’an, Shenzhen.

Overseas regions are also gaining momentum.

The annual report shows that in 2025, revenue from Han’s Laser CNC’s overseas regions was RMB 609 million, up 68.30% year over year.

Prismark data also shows that in 2025, the PCB market—mainly in Southeast Asian countries—grew 20.5% to USD 7.33 billion. The incremental growth mainly came from new factories in places like Thailand and Vietnam established by mainland China PCB companies.

When mainland China PCB companies go to build factories in Southeast Asia, they also bring their domestic supply-chain partners along.

The other side of high growth

In 2025, Han’s Laser CNC earned RMB 824 million in net profit, but the net cash flow generated from operating activities was only RMB 181 million.

The annual report explains this gap as follows: the company is in a phase of rapid business expansion, so to ensure order delivery it stocked inventory in advance. Full-year inventories rose from RMB 898 million to RMB 1.89B, an increase of nearly RMB 1 billion. At the same time, PCB equipment industries generally use installment payment settlement models, meaning after equipment delivery, the payment is collected in several installments. Full-year operating accounts receivable increased by more than RMB 2 billion.

The annual report categorizes this phenomenon as a “normal operating occurrence during the business expansion stage.” Quarterly data also supports this: in the fourth quarter of 2025, Han’s Laser CNC’s single-quarter operating cash flow reached RMB 876 million, turning the accumulated negative values from the first three quarters positive at once.

Meanwhile, the 2025 annual report shows that contract liabilities increased from RMB 54.9 million at the end of the prior year to RMB 198 million. Prepaid customer payments increased significantly, indicating that downstream customers are making advance payments to lock in equipment production capacity.

On March 11, Han’s Laser CNC stated on an investor interactive platform that orders in hand are sufficient, and it is producing and delivering in an orderly manner.

However, to meet capital turnover needs arising from business expansion, Han’s Laser CNC added a number of bank loans in 2025. The annual report shows that its short-term borrowings rose from about RMB 530k at the end of the prior year to RMB 474 million; the company’s full-year asset-liability ratio reached 42.68%.

This is also part of the background for Han’s Laser CNC’s decision to list in Hong Kong at this time.

On February 6, 2026, Han’s Laser CNC was listed on the Hong Kong Stock Exchange, officially becoming a dual-platform A+H listed company. Several global institutions participated in cornerstone investments, including Singapore government investment company and Schroders, among others.

The annual report shows that the funds raised by Han’s Laser CNC will be mainly used to enhance R&D capabilities, expand overseas sales networks, and build production capacity. According to publicly disclosed information, Han’s Laser CNC has already set up a subsidiary in Thailand, established an R&D center in Singapore, and in December 2025 it also newly established a subsidiary in Vietnam.

In addition, Han’s Laser CNC’s customer concentration is also on the high side.

The annual report shows that the company’s top five customers together contributed 37.65% of revenue. Of them, the largest single customer contributed RMB 530k in full-year revenue, accounting for 27.24% of Han’s Laser CNC’s total revenue—more than one quarter.

Not only is customer concentration high, but product structure is also concentrated.

In 2024, drilling-related equipment revenue accounted for 62.8% of Han’s Laser CNC’s total revenue. In 2025, that figure rose to 72.19%.

Among Han’s Laser CNC’s six product lines, exposure-related equipment is the only category with revenue decline, with a year-on-year drop of 5.33%. Inspection-related equipment grew by 94.62%, but its revenue base is only RMB 534 million—still just a fraction compared with the RMB 1.57B from drilling-related equipment.

Han’s Laser CNC is also trying to broaden its product lines.

The annual report discloses that Han’s Laser CNC’s new laser processing equipment has obtained process acceptance from downstream customers and has received formal orders. Among them, ultra-fast laser drilling machines use a cold-processing approach, which is considered more suitable for processing next-generation high-frequency, high-speed materials.

However, the annual report also discloses that new products such as ultra-fast laser drilling machines and glass substrate processing equipment are currently still at the prototype or small-batch production stage.

Han’s Laser CNC also mentioned in the annual report that it has competitive disadvantages: “For high-tech products such as class carrier boards and IC packaging substrates, core end customers are still mainly international companies. Domestic equipment has limited recognition in these fields, and the company’s global brand strategy is still at an early stage of promotion.”

For new products, Han’s Laser CNC is making significant efforts.

The annual report shows that in 2025, R&D expenses were RMB 458 million, up 71.47% year over year; the number of R&D personnel was 908, up 30.46% from the prior year, including 22 PhDs—more than five times the previous year.

The annual report also points to a direction worth paying attention to: orthogonal backplanes. This is a type of PCB with potentially more than 100 layers, used to replace traditional copper cable connections. Han’s Laser CNC says it will deeply align and connect with the development of new products in this field.

Currently, Han’s Laser CNC’s downstream customers are stepping up capacity expansion in a concentrated manner. For example, in March 2026, Shenghong Technology announced its annual investment plan with a total not exceeding RMB 20 billion, including fixed-asset investment not exceeding RMB 18 billion. Shandong NanYa Circuit (002463.SZ) also announced a plan to invest RMB 5.5 billion to build a new high-end PCB project. Pegatron? (002938.SZ) plans to invest RMB 11 billion to build a high-end PCB production base.

The combined incremental investment of hundreds of billions of yuan across these three companies is all directed toward high-end PCB capacity related to AI servers. The customer list disclosed in Han’s Laser CNC’s annual report also includes these three enterprises.

It is worth mentioning that Hongxing International, a subsidiary under Shenghong Technology, took shares as a cornerstone investor when Han’s Laser CNC listed on the Hong Kong market. The customer buying equipment also became a shareholder of the company.

For Han’s Laser CNC, the situation right now is very clear: downstream customers are expanding capacity with big spending, and there are no signs in the near term that demand for drilling equipment will slow down.

But with 70% of revenue coming from one process and one quarter of revenue coming from a single customer, it also means the company’s performance is highly tied to the pace of AI compute capacity expansion.

Whether it can grow new revenue pillars beyond drilling may be the most important thing for Han’s Laser CNC in the next few years.

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