Price Hike Wave Strikes! Passive Component Concept Shows Active Performance, Multiple Stocks Expected to Achieve High Growth

On the morning of March 18, passive component concepts fluctuated higher, with Fara Electronics hitting the daily limit. Maijie Technology, Taijing Technology, Xinwei Communications, and Sanhuan Group led the gains. News-wise, driven by rising raw material costs upstream and increased demand from AI, passive electronic components are entering a new round of comprehensive price hikes.

Leading MLCC Manufacturer Announces Full Price Increase

According to media reports, major passive component manufacturer Murata of Japan officially issued a price increase notice, initiating a full price hike for AI servers and high-end automotive-grade MLCC products, with increases ranging from 15% to 35%.

Murata is the world’s largest MLCC supplier, holding over 40% of the global market share and 70% of the AI server market. The products affected include multilayer chip ferrite beads, multilayer ferrite power inductors, multilayer RF inductors, and multilayer common-mode chokes. The new pricing will take effect on April 1 (subject to order receipt).

Notably, this is Murata’s first large-scale price adjustment in nearly three years, signaling a new upward cycle in the global passive component market. Previously, domestic and international companies such as Samsung Electro-Mechanics, KEMET, Walsin, Fenghua High Tech, and Sanhuan Group had announced price increases for MLCCs and other passive components.

Institutions Optimistic About Continued Upward Cycle

CICC believes that most price increases are driven by metal cost pass-through, while demand for high-end MLCCs and tantalum capacitors remains driven by market needs. The current MLCC price hike shares similarities with previous rounds in terms of cost support and tight supply-demand for high-end products, but differs in that consumer electronics demand is relatively flat. “We favor the emergence of structural price increases, especially for AI server exposure and high-utilization overseas leaders, which have the conditions to raise prices. The opportunity for domestic MLCC manufacturers to follow suit or accelerate localization remains to be seen.”

Research from Kaiyuan Securities indicates that the significant rise in costs due to increases in labor, electricity, and raw materials such as silver, ruthenium, palladium, tin, and copper is the main reason for price hikes among passive component manufacturers. The upstream metal price pressures are transmitted downstream through intermediate powders, metal pastes, magnetic materials, and supporting materials. Based on the utilization rates of major manufacturers, there is a trend of further capacity utilization increase from high levels.

The agency further assesses that inflation factors dominate this round of passive component price increases, with supply and demand remaining at normal levels and no signs of tightening yet. Unlike previous cycles driven mainly by consumer electronics demand, the rapid growth in downstream sectors such as AI servers, new energy vehicles, and industrial control, along with ongoing penetration by domestic manufacturers into high-end categories, suggests this upward cycle could be longer and more sustainable.

Multiple Concept Stocks Expected to Show High Growth

According to Eastmoney’s concept sector data, nearly 30 A-share stocks are involved in the passive component concept, with a total market value close to 600 billion yuan. Sanhuan Group ranks among the largest, with Xinwei Communications, Guoci Materials, and Sunlord Electronics each exceeding 30 billion yuan in market value.

Since the start of the year, about 70% of passive component concept stocks have seen their share prices rise, with Jiemei Technology, Taijing Technology, and *ST Gaosu each gaining over 40% in the period.

From an earnings perspective, based on consensus forecasts from three or more institutions, Igor’s net profit attributable to shareholders is expected to surge over 60% year-on-year this year. Aerospace Rainbow, Fuchuan Technology, and Jiemei Technology are all expected to achieve nearly 50% net profit growth, while Fenghua High Tech and Sunlord Electronics are forecasted to see net profit increases of over 30%.

Igor is a leading domestic new energy transformer manufacturer. A recent research report from Dongwu Securities pointed out that the company’s overseas direct sales channels are now established, and data center business growth is further catalyzed, offering considerable growth potential. Given the company’s strong export capabilities and the rapid increase in overseas direct sales, along with gradual volume expansion of data center products, a PE multiple of 40x for 2026 is assigned.

Fenghua High Tech, in early March, stated during institutional surveys that the utilization rate of its main products remains high. The company is actively advancing capacity expansion for MLCCs, chip resistors, and inductors, accelerating product structure adjustments to support its high-end transformation.