BlockBeats news, on June 30, Citigroup upgraded Murata Manufacturing's rating from "Neutral" to "Buy" and significantly raised its target price from ¥3,900 to ¥15,000, citing that demand for AI servers is reshaping the growth trajectory of the high-end MLCC market.
In a research report released on June 29, Citibank stated that AI servers require significantly higher quantities and specifications of multilayer ceramic capacitors (MLCCs) compared to traditional servers. While a typical server board uses approximately 2,000 MLCCs, AI server GPU boards may approach 11,000 by 2026. As AI accelerator power consumption increases and current fluctuations intensify, servers require more high-capacitance, high-reliability components, driving up Murata’s product mix and average selling prices.
Citibank believes Murata is one of the primary beneficiaries of this shift. The bank estimates that Murata holds approximately 50% of the market share in high-capacitance MLCCs for AI servers, leading Samsung Electro-Mechanics and Taiyo Yuden, thanks to advantages in yield, materials technology, and high-end mass production capabilities. Murata has already added approximately 20% in capacity expansion beyond its regular annual increases, and Citibank notes that further expansion may become necessary if demand continues to rise.
Profit forecasts have also been significantly raised. Citigroup expects Murata’s FY3/27 operating profit to reach ¥440 billion, rising to ¥630 billion in FY3/28, and further increasing to ¥800 billion in FY3/29. The bank noted that profit growth is primarily driven by higher shipments of MLCCs for AI servers and improved pricing due to a greater proportion of high-spec products.
However, Citibank did not assume that Murata will broadly increase prices for general-purpose MLCCs. The report states that the company is currently more likely to improve profit margins through enhancements to its AI server product portfolio rather than proactively driving industry-wide price hikes. Nevertheless, if demand for high-end MLCCs continues to outstrip supply, or if competitors initiate price increases first, Murata may still gain additional upside potential in the future.
This report shows that AI trading is spreading from GPUs and HBM to more granular segments of the hardware supply chain. For Murata, market focus is no longer limited to smartphone and automotive cycles, but rather on whether AI servers can become a new core driver of profit growth.