A research report published on the 15th by iM Securities finds that key indicators tracking conditions in the multilayer ceramic capacitor (MLCC) market are improving across the board.
Lead times for commodity-grade MLCCs, as measured by distributor TTI, are extending broadly, with the smallest form factor — the 0201 — showing a particularly sharp rise. High-capacitance MLCCs entered a lead-time expansion phase in May, and by mid-July the 0805 and 1206 sizes were also stretching further. Data from a second major distributor, Future Electronics, tells the same story: in June, lead times lengthened simultaneously across all the principal manufacturers — Murata, Samsung Electro-Mechanics, Taiyo Yuden, and Yageo. Price increases have been confirmed in some product categories, prompting iM Securities to characterise the current moment as "the early stage of a transition from lead-time expansion to price rises."
Trade data point in the same direction. South Korea's capacitor exports hit a record high in value terms in June. Taiwanese passive-component makers posted June revenues 35% above the same period a year earlier, despite a high comparison base. China's capacitor exports in May were up 24% year on year, and Japan's capacitor shipments to Taiwan in May approached their own all-time high in value terms.
A shift in the commentary from market research firm TrendForce further corroborates the improving outlook. At the start of the year, TrendForce described demand in cautious terms; it now speaks of recovery driven by AI servers and high-capacitance products. Its assessment of supply and demand has moved from "inventory adjustment" to "tightening at the high end," while its price commentary has shifted from "stable to mixed" to "price-increase discussions under way for select products."
iM Securities attributes these developments to leading manufacturers expanding their server-grade MLCC capacity, raising prices on commodity products, and in some cases suspending quotations. Given the production ramp schedules for new server platforms, the brokerage expects these pressures to intensify as the year progresses into the second half.
On valuation, iM Securities notes that the MLCC industry's average price-to-earnings ratio on a 2027 basis has been revised to 35 times, with a price/earnings-to-growth (PEG) ratio of 0.7 times. Samsung Electro-Mechanics has pulled back to a level equivalent to two standard deviations above its ten-year average on a 12-month forward P/E basis. iM Securities maintains an Overweight recommendation on the electrical and electronics sector.