Daiwa: Initiates Buy rating for InnoCare Pharma (02577.HK), optimistic about the demand for gallium nitride driven by data centers.

According to the Zhitong Finance APP, Daiwa has released a research report assigning an initial "Buy" rating to InnoCare (02577.HK) with a target price of HKD 55, corresponding to an estimated price-to-earnings ratio of about 21 times for 2030. The firm believes that as the power density of artificial intelligence data center racks increases from the current level of approximately 150kW to 1MW starting next year, the existing 400V AC power distribution architecture will reach its physical limits. It is anticipated that the industry will transition to an 800V DC architecture starting in the second half of next year, at which point the demand for gallium nitride power devices will increase.