Summary of Conference Call Notes Company Overview - The company is one of the early players in the domestic NB chain liquid cooling plate OEM market and is in the process of acquiring Zhaoke to establish a comprehensive solution for materials and components, transitioning from OEM to direct supply to enhance core competitiveness [2][4][7]. Industry Insights - The liquid cooling plate is a critical component of liquid cooling systems, responsible for 95% of energy-saving tasks, requiring high thermal conductivity and reliability [2][9]. - The company has entered the supply chains of major clients such as ZTE and Huawei for polymer materials, and CATL and Hive Energy for thermal management products [5][16]. Financial Projections - Expected revenue for 2025, 2026, and 2027 is projected to be 1.29 billion, 2.51 billion, and 3.9 billion yuan, respectively, with year-on-year growth rates of 34.7%, 44.4%, and 55.5% [2][8]. - Net profit attributable to the parent company is expected to be 44 million, 150 million, and 250 million yuan for the same years, not considering the consolidation of Zhaoke [2][8]. Competitive Advantages - The company possesses unique competitive advantages in the liquid cooling plate OEM sector, including proprietary welding technology that ensures long-term stable operation of liquid cooling plates [4]. - The acquisition of Zhaoke will enhance the company's overall competitiveness by integrating thermal interface materials (TIM) with cooling plate solutions, leveraging Zhaoke's customer resources [7]. Product Development and Technology - The company has developed high-frequency welded liquid cooling plates compatible with CATL's Kirin and Shenxing batteries, which are key cooling components [3][16]. - The thermal management business includes products such as liquid cooling plates for new energy vehicles, with a focus on aluminum alloy materials and various manufacturing processes [14]. Market Trends and Future Outlook - The company anticipates rapid growth in its new energy liquid cooling plate business due to increased vehicle deliveries, which is expected to enhance capacity utilization and gross margin [3][16]. - The data center cooling module OEM business is projected to achieve revenues of 910 million and 2 billion yuan in 2026 and 2027, respectively, with a gross margin expected to remain around 20% [18]. Investment Recommendations - Despite market expectations of a tech stock adjustment in Q4, the company’s business is expected to continue progressing, with strong growth potential in the liquid cooling sector [20]. - Investors are advised to focus on high-growth, high-certainty sectors with continuous technological advantages, particularly in the liquid cooling segment [20].

Investment Rating - The report assigns an "Accumulate" rating for the company, marking the first coverage of the stock [5]. Core Views - The company is a leader in the aluminum plate-fin heat exchanger market and is entering the liquid cooling sector for data centers, which opens up new growth opportunities [2][16]. - The company has a strong technical foundation and customer resources, which are expected to drive growth in both traditional and emerging markets [16][24]. - The demand for efficient and energy-saving heat exchange solutions is surging due to the rapid growth of AI server computing power, aligning the company's capabilities with industry trends [5]. Summary by Sections 1. Company Overview - Founded in 2000, the company focuses on manufacturing aluminum plate-fin heat exchangers for various industries, including air compressors and engineering machinery [2][16]. - The establishment of a joint venture with Suzhou Hexin Precision Technology marks the company's entry into the liquid cooling equipment sector, which is significant for business expansion [2][16]. 2. Traditional Markets - The company has diversified applications in various sectors, including engineering machinery, wind power, compressors, and diesel engines, with significant market potential in each [3][4]. - The engineering machinery market is projected to have a cooling system market space of approximately $14 billion in 2024, driven by the recovery in demand and the electrification trend [3][37]. - The wind power sector is expected to see a cooling system market space of around 14.7 billion yuan in 2024, benefiting from industry recovery and technological upgrades [4][41]. - The compressor market is estimated to reach approximately $9.8 billion in 2024, with traditional and AI data center demands driving growth [4][46]. - The diesel engine market for data centers is projected to reach 74.9 billion yuan by 2028, indicating substantial growth potential [4][59]. 3. Data Center Sector - Liquid cooling technology is essential for addressing heat dissipation challenges in data centers, offering advantages such as low energy consumption and high cooling efficiency [4][5]. - The market for liquid cooling systems is expected to grow significantly, with projections of 29.4 billion yuan for ASIC systems and 58.1 billion yuan for NVIDIA systems by 2026 [4]. - The company has established strong ties with key players in the industry, positioning itself favorably within the supply chain for liquid cooling components [4][5]. 4. Financial Projections - The company is expected to see a compound annual growth rate (CAGR) of approximately 13% in revenue from 2015 to 2024, with a notable recovery in profitability [24][26]. - The projected net profit for 2025-2027 is estimated at 1.0 billion, 2.0 billion, and 3.2 billion yuan, respectively, with corresponding dynamic P/E ratios of 49, 25, and 16 times [5].

Core Viewpoint - Ningbo Jingda (603088.SH) reported a significant increase in orders for heat exchange equipment by 62%, while also positioning itself in the robotics sector to create a second growth curve, despite overall performance being less than stellar [1]. Group 1: Financial Performance - For the first three quarters of 2025, the company achieved revenue of 549 million yuan and a net profit attributable to shareholders of 75.88 million yuan [1]. - The company's contract liabilities increased from 281 million yuan at the end of last year to 388 million yuan by the third quarter, indicating strong demand for orders [3]. - Inventory levels rose from 390 million yuan at the end of 2024 to 537 million yuan by the end of the third quarter, reflecting proactive preparations for downstream orders [3]. Group 2: Order Growth and Market Demand - The company experienced a 61.9% year-on-year increase in orders for heat exchange equipment, driven by strong demand in HVAC, refrigeration, and data center applications [2]. - Orders for high-speed precision presses showed a positive year-on-year growth of 23%, indicating a recovery in demand [2]. Group 3: Strategic Initiatives in Robotics - The company is actively entering the robotics sector, leveraging its technical advantages in micro-channel and precision mold components, which could open up a new growth space [4]. - A joint venture was established with Schola in Germany to integrate micro-channel equipment technology, enhancing the company's competitive edge [4]. - The acquisition of Wuxi Micro Research further extends the company's capabilities into precision molds and related components, aligning with its strategic transformation into a comprehensive service provider [4]. Group 4: Future Outlook - The combination of sustained order growth and strategic acquisitions is expected to lead to a recovery in the company's performance, initiating a new growth trend [6].

Core Viewpoint - The article emphasizes the critical importance of cooling technologies in data centers, particularly in the context of rising AI computing densities and the need for efficient heat management solutions [5][24]. Cooling Technology Evolution - The main cooling technologies are categorized into air cooling and liquid cooling, with air cooling further divided into natural and forced air cooling, while liquid cooling includes direct and indirect methods [6][13]. - The demand for innovative cooling solutions is driven by increasing power densities in data cabinets, necessitating significant improvements in heat transfer rates to ensure stable and efficient data center operations [8]. Air Cooling Technology - Forced air cooling is the most widely used method in data centers, utilizing fans to enhance airflow and cooling efficiency, while air conditioning and fresh air cooling are the primary techniques employed [9][11]. - Fresh air cooling systems, such as Distributed Airflow Cooling Systems (DACS) and Blowing and Suction Ventilation Cooling Systems (BDVCS), have shown rapid development and can significantly reduce cooling costs, especially in temperate or cold regions [12]. Liquid Cooling Technology - Liquid cooling utilizes high thermal conductivity liquids to replace air for heat dissipation, making it particularly suitable for high-density and high-power data center environments [13][23]. - The two main types of liquid cooling are indirect and direct liquid cooling, with indirect cooling involving heat exchange through conduits and direct cooling allowing liquids to contact heat-generating components directly [14][17]. Direct Liquid Cooling Methods - Single-phase immersion cooling involves submerging IT equipment in an insulating liquid, effectively transferring heat to an external cooling source [19]. - Two-phase immersion cooling utilizes a coolant with a boiling point lower than the operating temperature of the equipment, allowing for efficient heat absorption through phase change [20]. - Single-phase spray cooling sprays a cooling medium onto heat-generating surfaces, achieving high cooling efficiency but requiring careful design to prevent contamination [21]. Market Demand and Trends - The demand for liquid cooling solutions is increasing as computational power continues to rise, with single-phase cold plate cooling currently dominating the market [23]. - The latest advancements in computing technology, such as NVIDIA's GB200 module, highlight the limitations of traditional air cooling, which struggles to manage the heat generated by high-performance systems [24]. - Policies in China, such as the "East Data West Computing" strategy, aim to reduce energy usage in data centers, further driving the adoption of liquid cooling technologies [24][25]. Economic Benefits - In AI training scenarios, approximately 30% of energy costs are attributed to cooling, with liquid cooling systems significantly reducing Power Usage Effectiveness (PUE) compared to traditional methods [25]. - The implementation of liquid cooling can lead to substantial annual savings in electricity costs for medium to large data centers, reinforcing its position as a key development area in cooling technology [25].

Group 1: Company Acquisition and Business Development - The company is in the process of acquiring Dongguan Zhaoke Electronic Materials Technology Co., Ltd. to enhance its business layout in the polymer materials industry and expand its application scenarios in heat dissipation products. The acquisition involves complex cross-border merger issues, leading to a longer timeline for completion [2][3] - The company is actively supporting Dongguan Zhaoke's restructuring efforts and maintains close communication regarding the acquisition [3] - The data center cooling business is primarily conducted through its wholly-owned subsidiary, Shenzhen Chuangyuan Zhihuo Technology Co., Ltd., which focuses on special cooling modules and liquid cooling plates [4][5] Group 2: Financial and Market Performance - Shareholder Zhoushan Huineng reduced its holdings by 141,500 shares, accounting for 0.1119% of the company's total share capital, primarily due to the financial needs of former employees [6] - The company’s subsidiary, Suzhou Ruitai Technology Co., Ltd., produces high-frequency welded liquid cooling plates that are critical for the efficient operation of batteries in new energy vehicles, contributing to the company's stable growth [7] Group 3: Future Technology and Market Trends - The company emphasizes a market-oriented approach and independent research and development for technological innovation, focusing on next-generation liquid cooling technology and thermal interface materials [5][6] - The management is committed to continuous innovation in liquid cooling technology and its industrial application to enhance competitive capabilities and seize industry development opportunities [4][5]

Core Viewpoint - The cooling tower market is experiencing steady growth, driven by both traditional industry upgrades and emerging applications, with a projected compound annual growth rate (CAGR) of 6.39% from approximately $4.27 billion in 2024 to $7.46 billion by 2033 [1] Group 1: Market Demand and Structure - Cooling towers are essential heat dissipation facilities in energy and industrial systems, with stable market demand across various sectors including thermal power, petrochemicals, metallurgy, nuclear power, and data centers [1] - The global cooling tower market is expected to grow from approximately $4.27 billion in 2024 to $7.46 billion by 2033, indicating a CAGR of 6.39% [1] - The industry has a well-defined structure with clear divisions among upstream (electromechanical equipment, steel materials, chemical materials), midstream (cooling tower manufacturers), and downstream (heavy industries like petrochemicals and energy, as well as light industries like food and textiles) [1] Group 2: Technological Trends - The primary technology in cooling towers is wet cooling, which is efficient but has high water consumption; dry cooling is water-efficient but less effective; hybrid cooling towers balance efficiency and water usage, consuming about 20% of the water used by traditional wet towers [2] - The trend towards water conservation is accelerating the adoption of new cooling solutions [2] Group 3: Traditional and Emerging Applications - Traditional industries such as thermal power, petrochemicals, metallurgy, and nuclear power provide stable demand for cooling towers, with significant upgrades and renovations expected to drive further demand [3] - In the thermal power sector, the installed capacity is projected to reach 1,444 million kilowatts in 2024, accounting for 44% of the total, with upgrades driving cooling tower demand [3] - Emerging applications, particularly in data centers and nuclear power, are rapidly increasing demand for cooling towers, with data centers becoming essential for heat dissipation due to expanding computational power and liquid cooling solutions [3][4] Group 4: Data Center Growth and Liquid Cooling - The energy consumption of data centers is rising, with cooling systems accounting for about 40% of total energy use; by 2030, nearly 10 million edge computing nodes are expected to be deployed, increasing cooling demands [4] - Liquid cooling is becoming mainstream, enhancing the role of cooling towers in data center cooling systems, with the global data center cooling tower market projected to grow from $3.47 billion in 2024 to $6.78 billion by 2031, reflecting a CAGR of 10.9% [4] Group 5: Nuclear Power Expansion - The expansion of nuclear power into inland areas is driving the need for upgraded cooling tower technologies that are water-saving, low-noise, and environmentally friendly [5] - Nuclear fusion research is accelerating the demand for cooling solutions, with significant energy release potential and a projected financing scale of $7.1 billion by 2024, indicating rapid industry expansion [5] - Cooling towers are critical components of cooling systems in nuclear fusion, with the market expected to grow significantly as the industry develops [5]

Summary of Key Points from the Conference Call Industry and Company Overview - The conference call primarily discusses **Huawei** and its developments in the **data center** and **high-performance computing** sectors, particularly focusing on the **384 node system** and advancements in **liquid cooling** and **high voltage direct current (HVDC)** technologies. Core Insights and Arguments - **384 Node System**: The 384 node system is considered a transitional product with performance improvements over the 920B model, but still lacking in certain precision operations. Future products like the 950 and 960 are expected to enhance performance further [1][3][5] - **HVDC Adoption**: Huawei plans to adopt **800V or higher HVDC** systems to improve power supply efficiency and reduce energy consumption. A mixed mode of AC to DC UPS and HVDC is anticipated to be implemented by 2025-2026 [1][4][10] - **Liquid Cooling Technology**: Liquid cooling has become a standard configuration, with the 920C model reaching a maximum power of **600W**, while the upcoming 950 and 960 models are expected to reach **1,000W** and **1,200W** respectively. Liquid cooling is deemed necessary for high power density applications despite its higher cost compared to air cooling [1][11][14] - **Cost Analysis**: The cost of a liquid cooling system is approximately **20,000 yuan per square meter**, with a total cabinet cost around **120,000 yuan**. In contrast, air cooling systems cost between **15,000 to 20,000 yuan per square meter**, totaling around **80,000 yuan** for a cabinet [14][15] - **Market Projections**: Expected shipments for the 920C model in 2025 are around **300,000 units**, while the 920B is projected at **600,000 units**. The 950 model is set to launch in Q1 2026, but with lower yield rates [3][24][25] Additional Important Insights - **Partnerships**: Huawei's SVDC project collaborates with partners like **Kehua** and **Bank of China** to advance project development [7] - **UPS Systems**: The company utilizes both international brands like **Schneider**, **ABB**, and **Vertiv**, as well as domestic brands like **Kehua** in its UPS solutions, aiming for localization [8] - **Microchannel Technology**: This technology is being explored for high heat dissipation needs, particularly in the 950 series chips, although it currently has high material costs [20][22] - **Future Trends**: The data center industry is expected to gradually transition to liquid cooling systems, especially as power demands increase beyond **30 kW** per cabinet [28][29] - **Reliability Measures**: The 2N configuration in data center power systems ensures high reliability, with a design that allows for 99.9% uptime even in dual power failure scenarios [30][31] This summary encapsulates the key points discussed in the conference call, highlighting Huawei's strategic direction in the data center and cooling technology sectors.

Group 1 - Shenzhen Kexin Innovation Source New Materials Co., Ltd. hosted a specific investor survey with 11 institutions including Fidelity Fund and Wan Jia Fund on September 17-18, 2025 [1] - The company discussed its data center business, focusing on thermal management solutions through its subsidiary, Shenzhen Chuangyuan Zhihuo Technology Co., Ltd., which includes products like siphon-type special cooling modules and liquid cooling plates [1] - The company plans to acquire Dongguan Zhaoke Electronic Materials Technology Co., Ltd., which specializes in thermal interface materials, and has completed equity integration with Kunshan Zhaoke [1] Group 2 - The growth in the new energy business is attributed to the increasing demand for electric vehicles, with the company's subsidiary, Ruitai Technology, advancing new production line construction and upgrading existing lines to maintain its leading position [1] - In the first half of 2025, the company's traditional polymer materials business showed steady development, focusing on waterproof sealing, fire insulation, and moisture-proof materials, while aiming to strengthen its core business in telecommunications, electricity, and automotive sectors [1]

Group 1: Investment Projects - The company has invested in a data center liquid cooling project through Hangyuan Photothermal (Beijing) Technology Co., Ltd., which utilizes advanced aerospace cooling technology, achieving a PUE of 1.1 and a WUE of less than 0.05 kg/kWh [2] - The company has invested 1,200,000 yuan in Chengdu Shuzhilian Technology Co., Ltd., holding a 0.915% stake as of August 31, 2025 [2] Group 2: Product Development - The company has developed a high-performance T1 AC SPD (surge protective device) for domestic photolithography machines, currently in the sample stage [2] - A new multifunctional protective device against lightning and electromagnetic pulses has been successfully validated in several defense projects [3] Group 3: Financial Performance and Shareholder Returns - Since its listing in 2015, the company has consistently prioritized investor interests, with a total cash dividend amounting to 9,878.11 million yuan over the years, representing 68.52% of the average net profit over the last three fiscal years [3] - The controlling shareholder has not reduced their stake since the company's listing and completed a share increase plan in August 2018, amounting to 1,000.22 million yuan [3] Group 4: Market Confidence and Management - The management expresses confidence in the company's future development despite market fluctuations, attributing any personal share reductions to individual financial needs [3]

Summary of Liquid Cooling Technology Trends and Product Pricing Industry Overview - The liquid cooling technology is becoming a necessary choice for high-power data center cooling, driven by strict policy requirements for data center PUE values, which must reach 1.3 for new data centers and below 1.25 for national projects [1][4] - Liquid cooling significantly reduces operational costs, as demonstrated by a client in Beijing who saved 57.5% in annual electricity consumption after upgrading [1][4] Key Points and Arguments 1. **Demand Drivers**: - The demand for liquid cooling technology arises from the need for high-power chip modules (e.g., AI chips, GPUs, ASICs) and high-performance memory and optical modules [3][4] - Domestic GPU manufacturers are increasing density and quantity to compensate for single-chip performance gaps, with companies like Huawei launching systems to compete with NVIDIA's NVL72 architecture [3][12] 2. **Liquid Cooling Solutions**: - Mainstream liquid cooling solutions include direct contact, immersion, and spray cooling, each with its advantages and disadvantages [7][8] - Direct contact cooling is cost-effective, costing approximately 3,000 to 4,000 RMB per kW, while immersion cooling is more efficient but at a higher cost [3][16] 3. **NVIDIA's Product Development**: - NVIDIA's roadmap shows a strong demand for liquid cooling, with power consumption of the Rubin series expected to reach 1,800 watts in 2026 and 3,600 watts in 2027 [1][4][5] - The GB300 liquid cooling system's value increased by approximately 23% compared to the GB200, reaching $85,000 [10] 4. **Market Trends**: - The expected shipment volume for the GB200 cabinet in 2025 is between 25,000 to 30,000 units, primarily to North American cloud providers [2][11] - Domestic liquid cooling manufacturers are gaining recognition and certification from major companies like NVIDIA, with firms like BYD actively participating in the market [21] 5. **Challenges and Innovations**: - The use of fluorinated liquids poses environmental and safety concerns, prompting companies like Intel to explore new mineral oil alternatives [17] - The cost of immersion systems is high due to the need for large quantities of specialized liquids, which limits widespread adoption [18] 6. **Comparative Analysis**: - Compared to NVIDIA, other major players like Intel and AMD are progressing more slowly in high-power, high-density cooling solutions, relying more on traditional air cooling methods [6] 7. **Future Outlook**: - Domestic manufacturers are expected to achieve greater breakthroughs in the future as brand recognition increases and they establish long-term partnerships with leading clients in North America [21] Additional Important Content - The liquid cooling technology is widely applied in memory modules, optical modules, ASIC chips, and switch chips, with increasing power consumption necessitating these solutions [15] - The market share of traditional cooling methods remains significant, accounting for 70% to 80% of the market, due to lower modification costs and higher power density [18][20]