NVIDIA's 800VDC architecture ignites a new track for electrical equipment! Legrand and Siemens named by Goldman Sachs.

Goldman Sachs Group, Inc. noted in a research report released recently that investor discussions are increasingly focusing on NVIDIA Corporation's (NVDA.US) 800VDC architecture and the progress of major electrical equipment original equipment manufacturers (OEMs) racing to develop related product portfolios. These technological changes could reshape the industry's competitive landscape. Among Goldman Sachs Group, Inc.'s European coverage, regarding the investment theme of data center demand, the bank believes the best valuation opportunity is Legrand (upgraded to "Buy" today), followed by Siemens (maintaining "Buy"). The transition to an 800VDC power distribution architecture is primarily aimed at addressing the physical and electrical bottlenecks brought about by the scaled expansion of next-generation AI workloads. In this process, rack power density is soaring from tens of kilowatts to over 1 megawatt per rack. This architecture will enable higher power efficiency, reduce copper usage by up to 45%, and better manage fluctuating load changes. Key products currently under development include: upstream medium-voltage (MV) uninterruptible power supplies (UPS) and sidecar power modules deployed adjacent to racks in hybrid configurations; solid-state transformers (SST) or medium-voltage rectifiers for primary power conversion; high-efficiency DC-DC converters; solid-state circuit breakers; and advanced energy storage systems (CESS/BESS). The competitive landscape for 800VDC products encompasses traditional electrical equipment leaders, CECEP Solar Energy inverter manufacturers, and startups focused on solid-state transformers (SST). Goldman Sachs Group, Inc. notes that different companies differ in their choice of product technology routes, and their expected timelines for hybrid AC/DC retrofit solutions versus fully native 800VDC architectures also vary. Among traditional industry leaders, Legrand, Schneider Electric (Schneider), Eaton Corp. Plc (EYN.US), Vertiv (VRT.US), and Delta appear to have the most complete product layouts, covering both traditional products (including power transmission chains, cooling infrastructure, and network infrastructure) and products adapted to the 800VDC architecture. All of the above companies plan to launch sidecar power modules and are developing or advancing the commercialization of solid-state transformers. It is particularly worth noting that Legrand's product portfolio announced at its Capital Markets Day (CMD) exceeded Goldman Sachs Group, Inc.'s expectations. Highlights include the launch of new sidecar power modules, organic liquid cooling solutions, and AI load stabilizers, while also disclosing that solid-state transformers (SST) are under development. These additional products have enabled Legrand to form an almost complete product portfolio and help the company move away from its past traditional reliance on data center white space infrastructure business. This is also one of the core investment rationales behind the bank's upgrade of its rating to "Buy." With the transition to the 800VDC architecture, other key technology areas receiving attention include specialty cables and liquid cooling technology. Due to lower current requirements, cables can adopt thinner, smaller specifications. Although reduced copper usage may adversely affect sales volume, for leading European cable manufacturers Prysmian ("Buy" rating) and Nexans ("Buy" rating), this transition may help improve profit margins as average selling prices (ASP) rise due to higher engineering content. The high concentration of power in next-generation AI data centers (AIDC) may also accelerate the adoption of high-temperature superconducting (HTS) cables, and Nexans is a market pioneer in this field. Liquid cooling technology has likewise become a key essential technology for 800VDC data centers to maintain megawatt-level rack loads, regardless of whether the data center adopts a hybrid architecture or a complete 800VDC architecture. Shenzhen Envicool Technology and Vertiv have extensive liquid cooling product portfolios covering cold plates, piping, and coolant distribution units (CDU); while Alfa Laval is the market leader in copper-brazed heat exchangers used in CDUs.