GF Securities Overseas Electronics & Communications

CCL: Orthogonal backplane adopts PTFE material

NVIDIA has confirmed PTFE as the primary material choice for the Rubin Ultra orthogonal backplane. Below is the related analysis.

Orthogonal backplane officially adopts PTFE material:
According to our supply-chain checks, the previous M9 + Q-glass fabric solution failed to meet the required electrical performance standards. As a result, PTFE was ultimately selected as the core material for the orthogonal backplane.

1. PTFE offers excellent high-frequency transmission characteristics, with lower signal loss, enabling support for 337G and above SerDes signal transmission on the Rubin Ultra platform.

2. Traditional PTFE material is relatively soft, making drilling prone to burr formation and creating mass-production challenges. However, the newly developed silicon dioxide (SiO₂) filler-modified PTFE significantly improves mechanical rigidity. This material has already passed electrical performance tests and mass-production feasibility validation.

PTFE gradually replacing traditional glass-fiber materials:
PTFE CCL no longer uses glass fiber fabric. The production process involves coating hydrocarbon resin onto the PTFE surface, then directly laminating it with copper foil.

According to our checks, the unit price of modified PTFE material is around RMB 150,000 per ton. Each sheet of CCL consumes around 800 grams of PTFE, and the selling price of a full PTFE CCL sheet can reach RMB 2,500.

At present, the final design scheme for the orthogonal backplane has not yet been finalized. Candidate solutions include 78-layer and 108-layer structures, using a hybrid lamination combination of PTFE CCL / M9-Q glass fabric / ABF-filled CCL. The final design is expected to be determined in July.

Review of beneficiaries across the PTFE supply chain:
We expect Shengyi Technology (600183 SH) to become the primary supplier of PTFE CCL. Taiflex Scientific (8039 TT) is still in the product certification stage and is likely to become the secondary supplier.

On the upstream raw-material side, Dongyue Group (0189 HK) is currently Shengyi Technology’s core PTFE raw-material supplier. Daikin (6367 JP) and Haohua Chemical Science & Technology (600378 CH) are potential raw-material suppliers.

Based on preliminary order estimates, the PTFE CCL TAM for the 2027 Kyber platform could reach RMB 8 billion. Subsequent volume ramp-up of the Feynman platform should further drive demand.

Due to the complexity of the manufacturing process, midplane-related products are expected to begin mass production by the end of 2026.

The new process is also positive for PCB manufacturers. In current HLC PCB products, the ratio of total PCB value to CCL material value is around 2–2.5x. Under the new design, this ratio is expected to rise to 3–3.5x, significantly increasing the product value for PCB manufacturers.

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