From ‘rice’ to riches: China’s MLCC makers head to Hong Kong to list

Two major players in China’s multilayer ceramic capacitor (MLCC) supply chain are seeking Hong Kong listings, betting that a global surge in demand for the tiny electronic components powering artificial intelligence infrastructure will continue to fuel growth. Chaozhou Three-Circle, one of China’s largest MLCC manufacturers and already listed in Shenzhen, passed its listing hearing at Hong Kong Exchanges and Clearing (HKEX) last week ahead of an initial public offering sponsored by China Galaxy International. Close behind is Shanghai-listed Jiangsu Boqian New Materials, a key supplier of metal powders used in MLCC production. The company filed its prospectus with HKEX last week, citing Frost & Sullivan data showing it was the world’s second-largest supplier of MLCC nickel powders in 2025, with an 11 per cent global market share. Often described as the “rice of the electronics industry” because of their tiny size and ubiquity, MLCCs are essential components in products ranging from smartphones and electric vehicles to AI servers and data centres. Nickel powder is a critical raw material used to manufacture the electrodes inside the capacitors. The planned listings come amid what Goldman Sachs has described as the “largest and longest” upcycle in the history of the MLCC industry. The rapid buildout of power-hungry AI data centres and computing clusters has sharply increased demand for high-capacitance MLCCs, creating supply constraints across the sector. Leading Japanese and South Korean manufacturers have been inundated with orders, prompting expectations of further price increases and a prolonged shortage. Taipei-based research firm TrendForce has warned the market could face a “structural shortage” in the second half of this year. While Japanese and South Korean giants dominate the supply of advanced MLCCs used in AI servers and data centres, their shift towards higher-end products has created opportunities for Chinese manufacturers to gain market share in lower-end segments. Chinese producers, however, still lag behind global leaders in the most sophisticated AI-related MLCC technologies, which require extremely high capacitance, strong heat resistance and increasingly compact designs. According to its prospectus, Chaozhou Three-Circle has achieved breakthroughs in high-end MLCC manufacturing, including dielectric layers about one micrometre thick and structures with more than 1,000 stacked layers. Such advances could support future applications in AI infrastructure. By comparison, Japan’s Murata Manufacturing crossed the one-micrometre threshold years ago and is now capable of producing dielectric layers thinner than 0.5 micrometres. Frost & Sullivan ranked Chaozhou Three-Circle as the world’s seventh-largest supplier of electronic ceramic materials and components in 2025, with a 2.7 per cent market share, making it the largest mainland Chinese player in the sector. The company’s revenue rose 22 per cent to 8.87 billion yuan (US$1.24 billion) in 2025 from 7.27 billion yuan a year earlier, while net profit increased to 2.62 billion yuan from 2.19 billion yuan, according to its prospectus. Revenue from electronic components, driven by strong demand for MLCCs used in consumer electronics and home appliances, jumped 44 per cent year on year in 2025 to become the company’s largest revenue contributor, accounting for 37.3 per cent of total sales. For Suqian-based Boqian, revenue climbed 22 per cent to 1.15 billion yuan in 2025 from 945 million yuan the previous year, while net profit surged over 150 per cent to 219 million yuan. Nickel-based products used primarily in MLCC manufacturing accounted for 74.8 per cent of the company’s revenue last year, according to the company.