Nvidia(US:NVDA) GOLDEN SUN SECURITIES·2025-05-17 14:41Investment Rating - The report maintains a "Buy" rating for Shenghong Technology (300476.SZ) with projected EPS of 1.34 in 2024 and 12.30 in 2027, indicating a significant growth trajectory [5]. Core Insights - The U.S. BIS has abolished the AI chip diffusion rules, leading to a substantial increase in chip demand, particularly benefiting companies in the Nvidia supply chain [10][12]. - Major overseas cloud service providers (CSPs) are significantly increasing their capital expenditures for AI investments, with a combined capital expenditure of $71.1 billion in Q1 2025, reflecting a 64% year-on-year growth [13][20]. - Nvidia is expanding its presence in Saudi Arabia, supplying over 18,000 GB300 Blackwell chips for a major AI infrastructure project, which is expected to drive further demand [21][26]. - The report highlights the establishment of a $100 billion project by AMD in Saudi Arabia and Qualcomm's re-entry into the data center CPU market, indicating robust growth in AI infrastructure investments [26][27]. Summary by Sections Section 1: U.S. Policy Changes - The U.S. BIS has rescinded the AI diffusion rules, which previously imposed strict export controls on AI chips, thereby enhancing the market for U.S. chip manufacturers [10][12]. - The new policy is expected to alleviate pressures on major tech companies like Nvidia, which had opposed the previous regulations [12]. Section 2: Capital Expenditure Trends - CSPs are maintaining high levels of capital expenditure, with Meta increasing its guidance for 2025 to between $64 billion and $72 billion, reflecting ongoing investments in AI infrastructure [20]. - Amazon is projected to spend $100 billion in 2025, focusing on AI-related services and infrastructure [20]. Section 3: Market Developments - Nvidia's partnership with Saudi AI company Humain is set to deliver a significant number of chips for AI projects, marking a strategic move into the Middle Eastern market [21]. - The establishment of a 5 GW AI park in the UAE, in collaboration with the U.S., signifies a growing trend in AI infrastructure development [27]. Section 4: Stock Performance - The electronic sector has shown a slight decline of 0.75% recently, with specific stocks in the semiconductor and consumer electronics sectors experiencing notable gains [28][31]. - The report suggests a potential upward shift in valuation levels for the electronic industry, driven by advancements in AI technology [34]. Section 5: Related Companies - Key companies mentioned include Nvidia, AMD, Qualcomm, and Shenghong Technology, with a focus on their roles in the expanding AI infrastructure market [36].