CHONGQING M&E (02722) rose more than 5% in Hong Kong trading. At the time of writing, the stock was up 5.39% to HK$2.54, with a turnover of HK$20.64 million.
The movement follows the recent release of the company's annual results for the period ending December 31, 2025. The group reported total operating revenue of RMB 10.044 billion, an increase of 11.87% year-on-year. Net profit attributable to owners of the parent company was RMB 764 million, representing a significant rise of 76.9% compared to the previous year. Earnings per share were RMB 0.21.
Analysts have previously highlighted potential benefits for the company from the expansion of the generator set industry. Zheshang Securities noted a trend towards self-built power stations by North American data centers. The global surge in AI development has driven an unexpected increase in computing power demand, leading major North American tech giants to significantly raise their capital expenditure forecasts for 2026. This has accelerated the construction of AI data centers (AIDC).
However, the US power grid faces challenges including aging infrastructure, lengthy grid connection processes, and significant electricity shortages. Coupled with policy directives encouraging tech giants to build their own power plants, the primary power source for US AIDCs is shifting from reliance on the public grid to self-built stations. This shift is driving demand for various on-site power generation solutions, such as gas turbines, aeroderivative gas turbines, internal combustion engines, and solid oxide fuel cells (SOFC). Diesel generator sets, as a core backup power solution, are also positioned to benefit from this industry expansion.
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