Group 1 - The core viewpoint is that the demand for AI computing power is driving the upgrade of the optical communication industry, with significant capital expenditures from overseas cloud providers and TSMC, indicating strong demand for AI infrastructure [2] - Major optical communication stocks, such as Yangtze Optical Fibre and Cable (06869), Huiju Technology (01729), and Hongteng Precision (06088), have seen notable stock price increases, reflecting market optimism [1] - The shortage of supply for high-speed optical chips is expected to be alleviated as upstream manufacturers actively expand production and the penetration rate of silicon photonics increases [2] Group 2 - Meta and Microsoft have reported that the tight supply of AI computing power will persist until 2026, with both companies exceeding market expectations in their fourth-quarter capital expenditures [1] - The demand for inference and training computing power is surging, leading to price increases from Amazon Cloud and Google Cloud [1] - The NPO technology, known for its low power consumption, high bandwidth, and maintainability, is becoming a key transitional solution for scaling up, with leading companies already positioning themselves to drive the industry towards more efficient optical interconnection architectures [2]

Investment Rating - The investment rating for the company is "actively participate" in the new stock issuance [28] Core Insights - The company is a national "small giant" in the field of passive optical devices, with its products widely used in data centers and telecommunications. The company is expected to accelerate its expansion driven by the demand from AI data centers [28] - The company has developed a series of CPO passive internal connection devices, which have achieved mass shipments for 400G and 800G optical modules, with 1.6T products also having achieved limited shipments [28] - The company has a low initial valuation for its IPO, indicating high elasticity for potential investors [28] Summary by Sections 1. Passive Optical Device "Small Giant" - The company, established in September 2011 and located in Shenzhen, specializes in the R&D, manufacturing, and sales of passive optical devices. It is recognized as a "small giant" by the national government and operates in three main business segments: passive optical fiber cabling, passive internal connection devices, and related supporting businesses [4][8] 2. Issuance Plan - The new stock issuance will adopt a direct pricing method, with an issuance price of 31.59 yuan per share. The initial issuance scale is 10.25 million shares, accounting for 15.06% of the total share capital post-issuance. The expected fundraising amount is 324 million yuan, with a total market value of 2.15 billion yuan post-issuance [13][14] 3. Industry Situation - The optical device industry is experiencing rapid technological iteration, driven by the explosion of AI computing power, which demands higher density, integration, speed, and lower power consumption. The AI application market for optical modules is projected to grow significantly, with a year-on-year growth rate of 146.48% [17][19] - The global data center market is also expanding, with the market size expected to grow from 56.7 billion USD in 2019 to 96.8 billion USD by 2025, reflecting a compound annual growth rate of 9.32% [18] 4. Competitive Advantages - The company has established a strong R&D capability, focusing on high precision, high reliability, and high consistency in its products. It has built long-term stable partnerships with major clients such as AT&T, Verizon, Google, and Amazon [21][22] - The company maintains a diverse product line that meets various customer needs across different segments, providing comprehensive solutions for data centers and telecommunications [22] 5. Comparable Companies - The company is compared with other firms in the industry, showing a revenue structure where passive optical fiber cabling products account for 70.34% of total revenue, and the company has a gross margin of 26.74% for 2024 [27][29]