CIG (06166) swung from early losses to gain more than 14% during the morning session. At the time of writing, the stock was up 11.52% to HK$126.8, with a turnover of HK$870 million. The move follows recent first-quarter results from optical module leader Zhongji Innolight Co., Ltd., which reported rapid volume growth in its 1.6T products, driving a sequential gross margin improvement of 1.6 percentage points to 46.1%. Further expansion of 1.6T production capacity is expected to support additional margin improvement. Innolight anticipates significant growth in demand for 1.6T optical modules in 2026 compared to last year, with 2027 likely to see these modules become more mainstream among cloud service providers. In an exchange interaction, CIG stated that it focuses on silicon photonics technology for high-speed optical modules and has already begun mass shipments of 800G products and small-batch deliveries of 1.6T modules to key overseas customers. Huaxin Securities previously noted that strong demand for both 800G and 1.6T optical modules is driving continuous capacity expansion at CIG, with production facilities in Jiashan and Malaysia gradually ramping up and a new manufacturing base in Mexico under development. The company expects 800G modules to remain its primary shipment driver in 2026, while 1.6T modules are set to see significant volume growth starting in the first quarter, with an upward trend anticipated.
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