Huaxi: Domestic computing power logic will be fully consolidated after the Spring Festival, focusing on recommending low-orbit satellite component and chip suppliers in the commercial aerospace field.

Huaxi released a research report stating that at the current point in time, facing short-term liquidity concerns and changes in overseas OpenAI capital expenditure expectations, the market reflects a gradual focus on cost-effectiveness ratio in the current AI development. It is expected that the market will remain volatile, with a recommendation for a relatively cautious and neutral sector allocation. In the field of commercial aerospace, suppliers of components and chips related to low-orbit satellites are highly recommended. Key points from Huaxi's report are as follows: Domestic computing power logic becomes more practical after the Spring Festival: Token call volume surpasses the US for the first time + verification of the chip turning point + dual drive of policy infrastructure construction After the Spring Festival, domestic computing power logic becomes more practical, with the surge in Token quantity and the turning point in domestic chip performance leading to a certain increase in computing power throughout the chain. At this point in time, short-term geopolitical conflicts (US-Iran escalation) may amplify risk-off sentiment. It is necessary to be alert to the disruption of overseas uncertainties on the pace of global AI investment. However, domestic market demand is relatively resilient, with strong hedging provided by the cost/ecosystem of domestic models. The entire chain of domestic computing power is expected to continue to steadily increase under the dual drive of policy and cost. It is anticipated that applications in core areas such as video and programming will accelerate, and domestic demand for related computing power is expected to drive the prosperity of hardware equipment and computing power leasing markets. Edge computing power distribution is also expected to benefit. AI development is still in a critical acceleration period of Scaleup and Scale out With the gradual enrichment of the supply system of related computing power chips, the bank believes that application development is still accelerating the demand for tokens, and the underlying computing power infrastructure is still in a period of expansion. The bank remains optimistic about the upgrade of Scaleup cabinets, opportunities for national manufacturers to upgrade in industries such as power supply and liquid cooling, the surge in demand for domestic computing power including chips, switches, servers, and the market opportunities brought about by the acceleration of capital expenditure by CSP manufacturers in computing power leasing and AIDC. Beneficiaries include: computing power leasing and third-party data center companies such as Beijing Sinnet Technology, Shanghai AtHub, Range Intelligent Computing Technology Group, Sharetronic Data Technology, Guangdong Hec Technology Holding, and Dawei Technology; domestic chip and Ascend ecosystem-related companies such as Cambricon, Hygon Information Technology, Beijing Teamsun Technology; overseas resonance + domestic inference volume-related optical interconnection companies such as Suzhou TFC Optical Communication, Zhongji Innolight, Eoptolink Technology Inc., etc.; edge computing power-related beneficiaries such as Wangsu Science & Technology. Risk warning: Uncertainty from geopolitical conflicts; technological and application progress falling short of expectations; policy initiatives falling short of expectations; systemic risks.