Core Viewpoint - The liquid cooling sector is poised to become a key investment direction in the AI computing revolution, with expectations of rapid growth in penetration rates and market demand [2][9][33]. Group 1: Market Dynamics - In August, the AI market sentiment expanded from optical modules and PCBs to include server power supplies and liquid cooling, with stocks like Invec and others reaching historical highs [1][14]. - The liquid cooling segment, previously seen as a laggard in AI trends, is now gaining fundamental support, indicating a shift from mere thematic speculation to a more robust market presence [1][33]. - The anticipated release of NVIDIA's GB200 and GB300 series chips is expected to drive the adoption of liquid cooling solutions, marking 2025 as a pivotal year for the sector [9][24]. Group 2: Technological Advancements - Liquid cooling technology is becoming a standard for next-generation computing products, with significant improvements in performance and efficiency compared to traditional air cooling [2][5]. - The transition from air cooling to liquid cooling is driven by the increasing power requirements of GPUs, with the B200 and B300 chips necessitating liquid cooling solutions due to their high power outputs [5][6]. - The introduction of new products supporting liquid cooling, such as AMD's MI350 series and Broadcom's Ethernet switches, signifies a broader acceptance and integration of liquid cooling technologies [7][9]. Group 3: Industry Growth Projections - TrendForce projects that the penetration rate of liquid cooling in AI data centers will increase from 14% in 2024 to 33% in 2025, driven by the mass production of NVIDIA's new server models [8][9]. - The market for liquid cooling components, including cold plates and heat exchange systems, is expected to expand significantly, with estimates suggesting a potential market size of 100 billion RMB by 2026 [12][9]. - The liquid cooling industry is anticipated to mirror the growth trajectories of optical modules and PCBs, with a strong likelihood of emerging leaders in the market [33][24]. Group 4: Competitive Landscape - Companies like Invec are positioned as key players in the liquid cooling supply chain, with significant stock price increases reflecting market confidence in their growth potential [14][17]. - The competitive landscape is characterized by two types of companies: system integrators like Invec and manufacturers focusing on individual components, each following distinct growth paths [25][26]. - The entry of domestic manufacturers into the global liquid cooling market is expected to follow the patterns seen in the PCB industry, with potential for substantial market share gains [19][24].

Summary of Liquid Cooling Market Insights and Immersion Solutions Outlook Industry Overview - The report focuses on the liquid cooling market, particularly in data centers, highlighting the transition from air cooling to liquid cooling due to increasing power density and energy efficiency needs [1][4]. Key Insights and Arguments - **NVIDIA's GB300 Cabinet**: The acceleration in the deployment of NVIDIA's GB300 cabinets is a significant driver for the liquid cooling market, with each cabinet's cold plate value exceeding 250,000 RMB due to enhanced cooling efficiency [1][2]. - **Market Growth**: The global liquid cooling market is projected to reach 80 billion RMB in 2026 and 140 billion RMB in 2027, with cold plate solutions currently dominating the market [1][6]. - **Cooling System Architecture**: Liquid cooling systems are divided into primary and secondary sides, with key components including cooling towers, chillers (40%-45% of primary side costs), CDU, and cold plates [1][5]. - **Power Density and PUE**: The transition to liquid cooling is driven by the need to reduce Power Usage Effectiveness (PUE), as 43% of data center energy is used for cooling [4]. Emerging Trends - **Shift to Immersion Cooling**: The introduction of NVIDIA's RUC series cabinets is expected to expand the market for immersion cooling solutions, which offer better heat dissipation but come with risks such as liquid leakage and environmental concerns [3][11]. - **Domestic Companies' Performance**: Domestic liquid cooling companies like Shunling Environment and Tongfei Co. are transitioning from other temperature control industries and are showing strong performance in the CDU sector [3][9]. Market Dynamics - **Catalysts for Growth**: The recent surge in market sentiment for liquid cooling is attributed to clearer capital expenditure guidance from major cloud providers like Google, Microsoft, and Meta, alongside the rapid growth in global liquid cooling material demand [2][10]. - **Competitive Landscape**: Taiwanese companies have advantages due to established relationships with top overseas chip clients, but domestic companies are poised to expand internationally, leveraging their technological strengths [10]. Cost Considerations - **Cooling Liquid Costs**: Each cabinet requires approximately 1,000 liters of cooling liquid, costing around 400 to 500 RMB per liter, leading to significant overall costs for liquid cooling systems [8]. Environmental Considerations - **Cooling Liquid Types**: The report discusses various types of cooling liquids, including hydrocarbon, organosilicon, and fluorocarbon compounds, highlighting the environmental challenges associated with fluorinated compounds [12][13]. Future Outlook - **Investment Opportunities**: The liquid cooling sector is expected to present long-term investment opportunities due to evolving supplier dynamics, new project increments, and technological advancements [14][15].

Core Insights - The stock private equity positions have increased for three consecutive weeks, with the stock private equity position index reaching 75.55% as of August 22, marking a 0.69 percentage point increase from the previous week [1][2] - The index has shown a significant upward trend since August, with a cumulative increase of 1.62 percentage points [2] - 55.29% of stock private equity positions are at full capacity (over 80% allocation), indicating strong confidence in the market [2] Investment Focus - Private equity firms are focusing on emerging growth sectors such as new consumption and technology [6] - Specific areas of interest include robotics, domestic computing power, AI applications, liquid cooling, and military industry sectors, as well as new consumption and media sectors with strong half-year performance [7] - The innovative drug sector is also gaining attention due to benefits from overseas licensing and domestic market expansion [7] Market Sentiment - The high positions reflect optimism among top private equity firms regarding the Chinese economy and market liquidity [5] - The current stock market risk premium remains high, suggesting that the stock market offers attractive value [5] - There is an expectation of a new upward cycle in the market as corporate earnings are anticipated to rebound due to supportive policies and a reversal of the downward trend in profitability [5] Scale Analysis - Among private equity firms, those managing over 50 billion yuan have high positions, with over 50% at full capacity [1][3] - The position index for large private equity firms (over 100 billion yuan) is 78.11%, while those in the 50-100 billion yuan range have a position index of 82.23%, with a notable increase of 3.55 percentage points for the latter [3][4] - A significant portion of these firms, 69.18% in the 50-100 billion yuan range, are fully invested, indicating strong market confidence [3] Strategic Opportunities - The focus on high-end manufacturing and internet sectors is driven by the presence of globally competitive Chinese companies, which are expected to see value reassessment [7] - The trend of Chinese companies expanding overseas is shifting from manufacturing to service sectors, highlighting opportunities in the consumer entertainment industry [7] - Technological advancements in chip design, manufacturing, and AI capabilities are expected to create numerous investment opportunities [7]

Core Viewpoint - The A-share market has seen significant growth in various sectors, particularly in AI-related fields, with many companies reporting substantial increases in net profit for the first half of the year [1] Industry Summaries Ground Equipment Sector - The ground equipment sector has increased by 107.85% this year, with 9 out of 15 companies reporting a year-on-year increase in net profit. Nairui Radar leads the sector with a net profit growth of 866.97% [2] PCB Sector - The PCB sector has risen by 93.12%, with 73 out of 112 companies reporting a year-on-year increase in net profit. Honghe Technology has the highest growth at 10,587.74% [3] - The demand for PCB is driven by a shortage in computing power, with global server sales expected to reach $95.2 billion in Q1 2025, a 134.1% increase year-on-year [3] CPO Sector - The CPO sector has grown by 79.05%, with significant profit increases from leading companies. Shijia Photon reported a net profit growth of 1,712% [4] - CPO technology is expected to penetrate the market significantly between 2026 and 2027 [5] AI Chip Sector - The AI chip sector has increased by 62.62%, with 22 out of 35 companies reporting a year-on-year increase in net profit. Youbuxun leads with a growth of 1,455.37% [6] - The market for AI chips is anticipated to expand further, supported by technological advancements and partnerships with leading companies [6] Rare Earth Permanent Magnet Sector - The rare earth permanent magnet sector has risen by 62.12%, with 41 out of 58 companies reporting a year-on-year increase in net profit. Huahong Technology leads with a growth of 3,480.57% [7] Humanoid Robot Sector - The humanoid robot sector has increased by 54.30%, with 107 out of 163 companies reporting a year-on-year increase in net profit. Tianyu Digital leads with a growth of 453.67% [8] - The industry is experiencing rapid development, with major companies investing in embodied intelligence [8] Liquid Cooling Sector - The liquid cooling sector has grown by 49.94%, with 77 out of 106 companies reporting a year-on-year increase in net profit. Gaolan Co. leads with a growth of 1,438.57% [9] Innovative Drug Sector - The innovative drug sector has increased by 44.05%, with 71 out of 145 companies reporting a year-on-year increase in net profit. Hanyu Pharmaceutical leads with a growth of 1,504.3% [10] - The sector is expected to transition from capital-driven to profit-driven growth by 2025, with domestic companies showing competitive advantages in new technologies [10]

Core Insights - A-share listed companies have reported significant profit growth in various sectors, with a total of 5,424 companies disclosing their semi-annual reports, showcasing strong performance in industries such as comprehensive services, agriculture, steel, and technology [1] Sector Summaries Ground Equipment Sector - The ground equipment segment has seen a remarkable increase of 107.85% this year, with 9 out of 15 companies reporting a year-on-year profit growth. Notably, Nairui Radar achieved a staggering profit increase of 866.97% [2] PCB Sector - The PCB sector has risen by 93.12% this year, with 73 out of 112 companies reporting profit growth. Honghe Technology led the sector with a profit increase of 10,587.74%. The demand for PCBs is driven by a growing need for computing power, with global server sales projected to reach $95.2 billion in Q1 2025, a 134.1% year-on-year increase [3] CPO Sector - The CPO sector has increased by 79.05%, with significant profit growth from leading companies. Shijia Photon reported a profit increase of 1,712%, while Xinyi Sheng saw a 355.68% increase. Analysts expect CPO technology to gain traction between 2026 and 2027 [4][5] AI Chip Sector - The AI chip sector has grown by 62.62%, with 22 out of 35 companies reporting profit growth. Yuboxun achieved a profit increase of 1,455.37%. The demand for AI computing power is expected to further expand, with new technologies enhancing chip performance [6] Rare Earth Permanent Magnet Sector - The rare earth permanent magnet sector has increased by 62.12%, with 41 out of 58 companies reporting profit growth. Huahong Technology led with a profit increase of 3,480.57%. The sector is benefiting from rising prices and sustained demand [7] Humanoid Robot Sector - The humanoid robot sector has seen a 54.30% increase, with 107 out of 163 companies reporting profit growth. Tianyu Digital achieved a profit increase of 453.67%. The industry is experiencing rapid development, with major companies investing in intelligent robotics [8] Liquid Cooling Sector - The liquid cooling sector has risen by 49.94%, with 77 out of 106 companies reporting profit growth. Gaolan Co. reported a profit increase of 1,438.57%. The market is undergoing a revaluation as liquid cooling technology expands into various applications [9] Innovative Drug Sector - The innovative drug sector has increased by 44.05%, with 71 out of 145 companies reporting profit growth. Hanyu Pharmaceutical achieved a profit increase of 1,504.3%. The sector is expected to transition from capital-driven to profit-driven growth by 2025 [10]

Core Insights - The AI computing power competition is reshaping the global technology industry, with AI computing power becoming a crucial infrastructure asset [2] - The market has seen significant growth in AI-related sectors, particularly in AI servers, optical modules, and high-end PCBs, with leading companies reporting strong earnings [2][6] - Nvidia's shift towards AI infrastructure has amplified the resonance effect between capital and industry, making the computing power sector a hot investment theme [2] Industry Performance - Major companies like Industrial Fulian and Xin Yi Sheng have seen their market values soar, with Xin Yi Sheng's stock price increasing over 28 times in three years and Sheng Hong Technology's stock rising over 500% this year [2] - Industrial Fulian reported a revenue of CNY 360.76 billion, with a year-on-year growth of 135.58%, and a net profit of CNY 121.13 billion, up 138.61% [6] - Xin Yi Sheng achieved a revenue of CNY 104.37 billion, a staggering growth of 282.64%, and a net profit of CNY 39.42 billion, up 355.68% [6][8] Market Trends - The demand for AI servers is a core revenue driver, with significant growth in the AI server segment, particularly for Industrial Fulian, which saw a revenue increase of over 60% year-on-year [6] - The optical module market is driven by AI investments, with companies like Zhongji Xuchuang and Tianfu Communication showing strong growth in revenue and net profit [7][8] - The liquid cooling market is expected to grow significantly, with predictions of a 33% penetration rate in AI data centers by 2025 [8] Future Outlook - The overall capital expenditure for AI infrastructure is projected to reach USD 3 trillion to 4 trillion by the end of the decade, with Nvidia leading the charge [14] - Domestic internet companies in China are increasing their capital expenditures on AI-related businesses, with a reported growth of 99.38% year-on-year [13] - The market for optical modules is expected to see continued high growth, particularly with the demand for 800G and 1.6T modules [8]

Core Viewpoint - The liquid cooling sector is poised to become a core investment direction in the AI computing revolution, with increasing penetration rates and a shift from speculative trading to fundamental support [4][6][10]. Group 1: Market Dynamics - In August, the AI market expansion spread from optical modules and PCBs to server power supplies and liquid cooling [1]. - Companies like Invec, Oulu Tong, and Megmeet have seen their stock prices reach historical highs, indicating a growing interest in the liquid cooling sector [2]. - The liquid cooling concept has been developing for nearly two years, but the actual market implementation has been slow [5][6]. Group 2: Technological Advancements - The demand for liquid cooling technology is becoming urgent with the release of NVIDIA's Blackwell series chips, which require advanced cooling solutions [8][10]. - The transition from air cooling to liquid cooling is driven by the increasing power requirements of GPUs, with the B200 and B300 chips necessitating liquid cooling solutions [7][8]. - The penetration rate of liquid cooling in AI data centers is expected to rise significantly, from 14% in 2024 to 33% in 2025, as major cloud service providers upgrade their infrastructure [12]. Group 3: Investment Opportunities - The liquid cooling market is projected to reach 100 billion RMB by 2026, driven by the increasing demand for AI servers and the expansion of liquid cooling solutions [15]. - Companies in the liquid cooling supply chain, such as Invec, have seen substantial stock price increases, with Invec's stock rising nearly 98% in August alone [17]. - The liquid cooling sector is expected to replicate the success of the optical module and PCB markets, with potential for significant growth and investment opportunities [20][27]. Group 4: Competitive Landscape - The liquid cooling industry can be divided into two categories: system integrators like Invec and manufacturers focusing on individual components [28]. - The entry of domestic manufacturers into the global liquid cooling supply chain is anticipated, similar to the previous trends seen in the PCB market [22][24]. - The high entry barriers in the liquid cooling sector are primarily due to the need for advanced system integration capabilities, which many manufacturers currently lack [32][35].

Core Viewpoint - The article discusses the rapid growth and potential of liquid cooling technology in the AI computing sector, highlighting its transition from a niche market to a standard requirement for next-generation computing products [4][11][36]. Group 1: Market Dynamics - In August, the AI market expanded from optical modules and PCBs to include server power supplies and liquid cooling systems [2]. - Companies like Invec, Oulu Tong, and Megmeet have seen their stock prices reach historical highs, indicating a shift in market sentiment towards liquid cooling as a viable investment opportunity [3][16]. - The liquid cooling sector, previously viewed as a laggard in AI trends, is now expected to become a leading investment focus due to its essential role in AI computing [4][16]. Group 2: Technological Advancements - Liquid cooling technology has evolved significantly over the past two years, with increasing expectations following the AI boom in 2023 [6][7]. - The introduction of high-power chips, such as NVIDIA's B200 and B300, necessitates liquid cooling solutions due to their high thermal output [7][8]. - The expected penetration rate of liquid cooling in AI data centers is projected to rise from 14% in 2024 to 33% in 2025, driven by the adoption of new server architectures [11][12]. Group 3: Investment Opportunities - The liquid cooling market is anticipated to reach a valuation of 100 billion RMB by 2026, driven by the increasing demand for AI servers and the corresponding rise in liquid cooling adoption [14][29]. - Companies within the liquid cooling supply chain, such as Invec and others, have experienced significant stock price increases, reflecting investor confidence in the sector's growth potential [16][19]. - The article suggests that the liquid cooling industry could replicate the success seen in the optical module and PCB markets, with potential new leaders emerging in the coming years [25][38]. Group 4: Competitive Landscape - The liquid cooling industry is characterized by two main types of companies: those with system design integration capabilities (e.g., Invec, Highlan) and those focused on manufacturing individual components [30][31]. - The article emphasizes the importance of system integration design capabilities as a high barrier to entry, which could limit competition from companies lacking experience in data center and server applications [34][35]. - As the market matures, the competitive landscape is expected to evolve, with a few key players dominating the supply chain, similar to trends observed in the PCB industry [29][36].

Core Viewpoint - The AI computing power competition is reshaping the global technology industry, with AI computing power becoming a "hard currency" in infrastructure as demand for large model inference and training surges [1] Group 1: AI Server Market - AI servers are the core revenue segment, with Industrial Fulian achieving record high revenue and profit in the first half of the year, with Q2 revenue surpassing 200 billion yuan and AI server revenue increasing over 60% year-on-year [2] - Inspur Information reported a revenue of 801.92 billion yuan in the first half of 2025, a year-on-year increase of 90.05%, with net profit rising by 34.87% [2] Group 2: Optical Module Market - Optical modules are crucial in AI investments, with leading companies like New Yisheng and Zhongji Xuchuang showing strong growth; Zhongji Xuchuang's revenue reached 147.89 billion yuan, up 36.95% year-on-year, and net profit increased by 69.40% [2] - Tianfu Communication also reported significant growth, with revenue of 24.56 billion yuan, a year-on-year increase of 57.84%, and net profit rising by 37.46% [2] Group 3: Liquid Cooling and PCB Market - Liquid cooling penetration is expected to rise significantly, with a projected 33% penetration rate in AI data centers by 2025; companies like Yingwei Ke achieved a revenue of 25.73 billion yuan, up 50.25% year-on-year [3] - PCB manufacturers are also experiencing growth, with Shenghong Technology's revenue increasing by 86% to 90.31 billion yuan and net profit soaring by 366.89% [4] Group 4: Supply Chain Developments - BYD Electronics entered the NVIDIA GB300 liquid cooling supply chain, leading to a 7.3% stock price increase; the company reported a revenue of 806.1 billion yuan, up 2.58% year-on-year [4] - Luxshare Precision's communication data center business grew nearly 50%, with overall revenue reaching 1245.03 billion yuan, a year-on-year increase of 20.18% [5] Group 5: Capital Expenditure Trends - Major cloud service providers are significantly increasing capital expenditures, with a 69% year-on-year increase to 87.4 billion USD in Q2 2025; combined capital expenditures for Microsoft, Amazon, Meta, and Google are expected to grow by 50% to 333.8 billion USD [7] - Domestic internet companies in China are also ramping up investments in AI-related businesses, with a combined capital expenditure of 55.01 billion yuan, a year-on-year growth of 99.38% [7] Group 6: Future Market Outlook - NVIDIA anticipates a capital expenditure of approximately 600 billion USD this year, projecting global AI infrastructure spending to reach 3 to 4 trillion USD by the end of the decade; China's market is expected to be around 50 billion USD with a CAGR of about 50% [8] - Investment opportunities are suggested in various components related to server hardware, including system assembly, GPU, CPU, storage, high-speed connectors, and PCB/IC substrates [8]

Core Viewpoint - The AI computing power competition is reshaping the global technology industry, with AI computing power becoming a "hard currency" in infrastructure as demand for large model inference and training surges [1] Group 1: AI Server Market - AI servers are the core revenue segment, with Industrial Fulian achieving record revenue and profit in the first half of the year, with Q2 revenue surpassing 200 billion yuan and a year-on-year growth of over 60% in AI server revenue [2] - Inspur Information reported a revenue of 801.92 billion yuan in the first half of 2025, a year-on-year increase of 90.05%, with a net profit of 7.99 billion yuan, up 34.87% [2] Group 2: Optical Module Market - Optical modules are crucial in AI investments, with leading companies like Zhongji Xuchuang showing strong growth, reporting a revenue of 147.89 billion yuan in the first half of 2025, a year-on-year increase of 36.95%, and a net profit of 39.95 billion yuan, up 69.40% [2] - Tianfu Communication also demonstrated significant growth, with a revenue of 24.56 billion yuan, a year-on-year increase of 57.84%, and a net profit of 8.99 billion yuan, up 37.46% [2] Group 3: Liquid Cooling and PCB Market - The demand for liquid cooling is expected to rise significantly, with a projected penetration rate of 33% in AI data centers by 2025, and companies like Yingwei Ke achieving a revenue of 25.73 billion yuan, up 50.25%, and a net profit of 2.16 billion yuan, up 17.54% [4] - PCB manufacturers are also experiencing growth, with Shenghong Technology reporting a revenue of 90.31 billion yuan, a year-on-year increase of 86%, and a net profit of 21.43 billion yuan, up 366.89% [4] Group 4: Overall Market Trends - The A-share computing power industry chain is being revalued by the market, with leading companies showing strong performance, indicating a robust demand driven by the expansion of global AI infrastructure [5] - Major cloud service providers like Microsoft, Amazon, Meta, and Google are increasing capital expenditures significantly, with a combined capital expenditure of 87.4 billion USD in Q2 2025, up 69% year-on-year [7] Group 5: Future Projections - NVIDIA expects global AI infrastructure spending to reach 3 to 4 trillion USD by the end of the decade, with China being the second-largest computing market projected at around 50 billion USD, growing at a CAGR of approximately 50% [8]