HK Stock Market Move | FIT HON TENG (06088) rose more than 5% as AI development drives the construction of computing power infrastructure. Institutions are optimistic about the company's earnings growth.

FIT HON TENG (06088) rose more than 5%, as of press time, it has risen by 5.71% to HK$4.07 with a trading volume of HK$74.1253 million. On the news front, Huang Renxun recently announced in a speech that Nvidia will continue to adopt copper cable interconnection solutions and will continue to use copper cables in the coming years. Compared to optical modules, high-speed copper cables can usually save 50% to 80% in costs, while increasing chip performance by up to 30 times and reducing power consumption to one twenty-fifth of traditional materials. These advantages have led to the increasing use of high-speed copper cables in the data center connectivity field. Some industry experts have stated that with the booming development of AI computing power, the demand for data processing and transmission is growing significantly, leading to a growing demand for high-speed copper connections, and related copper connection suppliers are expected to benefit from this. China Securities Co., Ltd. previously pointed out that FIT HON TENG is a global leader in the precision zero-component field, with Hon Hai being the actual controlling shareholder of the company. The development of AI is driving the construction of computing power infrastructure, and the connection system architecture is evolving towards higher speeds. FIT HON TENG's layout in high-speed connection systems covers areas such as copper connections and optical modules, and is expected to benefit fully. With the expansion of business scale and the continuous improvement of quality and efficiency, the company's profitability is expected to increase in the future. CMB International pointed out that the management expects a three-year CAGR revenue growth of 20% for FY25-27E, with server/interconnect business revenue expected to grow by 15-20% year-on-year in 2024, AI server-related product revenue expected to account for 8-10% of revenue, primarily driven by the shipment growth of copper connector products, as well as the rapid expansion of MCIO and high-speed I/O products.