Fiber optic concept stocks surged in early trading on August 12, with Zhishang Technology hitting the daily limit up by 20%, while Tongding Interconnection, Zhicheng Technology, and Yongding Co. all hit the daily limit. Tianfu Communication, Changyingtong, Changjin Photon, and Phillips Hu rose over 10%, and Tencent Technology, Guangku Technology, Taicheng Technology, and Changguang Huaxin also followed gains.
On the news front, Shanghai's five-year plan for the software and information services industry targets a 4 trillion yuan scale, with a specific focus on enhancing intelligent computing hardware supply and building intelligent computing clusters. Overseas, Google is expanding submarine cables in the Americas, and Lumentum's earnings exceeded expectations. With policy support, growing demand, and strong earnings, the optical communication sector is seeing a recovery in its boom cycle.
Fiber Optic Sector Gets Dual Boost from Policy and Industry Catalysts
On August 11, the Shanghai Municipal Economic and Information Technology Commission issued the "15th Five-Year Plan for the Development of Shanghai's Software and Information Services Industry," which sets a target for the industry scale to reach 4 trillion yuan by 2030, with industry added value exceeding 1.1 trillion yuan and the number of companies with revenue over 10 billion yuan increasing to 35. Specifically, the plan positions software and information service enterprises as the "main channel and main service provider" for AI applications, focusing on AI technology breakthroughs, accelerating the layout of frontier base model technology systems such as physical intelligence, world models, quantum intelligence, and brain-like intelligence, and enhancing intelligent computing hardware supply capabilities around core areas like GPU/NPU, CPO, and HBM. For intelligent computing cluster layout, the plan proposes implementing a "hundreds, thousands, millions" intelligent computing cluster project, forming a tiered supply system that coordinates "large clusters, small clusters, and edge computing—deploying 100,000-card ultra-large-scale intelligent computing clusters in areas like Songjiang, Lingang, and Qingpu, and building 1,000-card intelligent computing clusters in Baoshan, Pudong, and Jiading.
On the overseas industry front, Google announced it will expand its global network infrastructure in the Americas, launching three new submarine cable systems: Alisios, Canoa, and OlaLuz, and adding a new branch of the Firmina submarine cable to the Dominican Republic. Previously, Google had advanced several large-scale submarine cable projects, including Humboldt (Chile to Australia, 14,800 km), Nuvem (Portugal to the U.S.), and Sol (U.S. to Spain). Additionally, optical communication giant Lumentum reported its fourth fiscal quarter revenue increased 109% year-over-year to $1.01 billion, with adjusted earnings per share of $3.23, a massive 267% increase year-over-year. The next quarter's revenue guidance midpoint is $1.255 billion. These financial metrics all exceeded market expectations, further validating the strong demand for optical communication driven by the AI computing era.
Institutions: Time to Allocate Fiber Optic Cables
Fiber optics are the core transmission medium for modern communication networks and data centers. With the acceleration of AI computing infrastructure construction, Scale Up and high-speed network upgrades are driving increases in fiber usage, cable core counts, and port density. Wiring is evolving towards high density, low loss, and modularization, and the optical communication industry is entering a high-boom cycle with both volume and price growth. A recent research report from Kaiyuan Securities indicates that the demand for fiber optics driven by AI infrastructure construction is considerable, with demand certainty still obvious. Fiber optic leaders holding core market shares domestically and internationally are expected to benefit continuously. The firm continues to be optimistic about investment opportunities in fiber optic cables. CITIC Securities believes that as cloud vendors' earnings continue to confirm AI's role in driving business growth, the scale of AI clusters will further expand. As a crucial part of cluster networks, optical interconnection will see sustained high growth driven by three factors: increased GPU allocation, port speed upgrades, and the "optical in, copper out" trend. The firm is optimistic about the medium- to long-term boom in the optical communication sector. Guosheng Securities also believes that the previously overcrowded trading structure in the optical module sector is improving, with short-term risks having been largely released. While full turnover and rebalancing of positions in the bottom area still require time, they advise waiting for the gradual accumulation of positive factors and the gradual restoration of market confidence.
Multiple Concept Stocks Expected to See Earnings Doubling
According to the Dongfang Caifu concept board, the A-share market currently has 70 stocks related to the fiber optic concept, with a combined market capitalization of about 3.6 trillion yuan. Hangzhou Hikvision Digital Technology (code: 002415) leads with a market value exceeding 300 billion yuan, while YOFC (code: 601869), Tianfu Communication (code: 300394), Sanhuan Group, and BOE A all have market values over 200 billion yuan. Six other stocks, including Yuanjie Semiconductor Technology (code: 688498) and Accelink Technologies (code: 002281), also have market values exceeding 100 billion yuan. Year-to-date, nearly 70% of fiber optic concept stocks have recorded price gains. Changjin Photon surged 510% to lead the sector, with Hangzhou Cable, Yunnan Germanium, and Yuanjie Semiconductor Technology all rising over 200%. YOFC and Sanhuan Group have also seen their stock prices double. On the downside, eight stocks, including Jiuzhiyang, Zhaolong Interconnect, and Guocable Testing, have fallen over 20%. Since August, fiber optic concepts have rebounded significantly after a deep correction, with 66 stocks rising and 4 falling. Hengdongguang led the month with a gain of nearly 55%, followed by Yunnan Germanium with a surge of nearly 50%, and Henan Shijia Photons Technology (code: 688313) ranking third with a 45% gain. As many as 18 stocks, including Guangku Technology, Tencent Technology, and Changguang Huaxin, all rose over 20%.
From a capital perspective, according to Dongfang Caifu Choice data, 37 fiber optic concept stocks have been favored by margin traders this month. Among them, Accelink Technologies received 810 million yuan in leveraged capital, while Yunnan Germanium and Hengtong Optic-Electric (code: 600487) saw net purchases of 478 million and 468 million yuan, respectively. Five stocks, including Hangzhou Hikvision Digital Technology, Han's Laser, and Zhongtian Technology, all received over 200 million yuan in net margin buying. In terms of future growth potential, based on consensus forecasts from three or more institutions, 10 fiber optic concept stocks are expected to see their earnings double this year. Among them, institutions predict that Far East Smarter Energy's net profit could surge 14.1 times year-over-year, while Xin'an Chemical and Yuanjie Semiconductor Technology are both expected to see net profit increases of over 3.7 times. FiberHome Telecommunication Technologies, Changguang Huaxin, Xinde New Materials, and Changyingtong are all forecast to have net profit growth of more than 200%. Hengtong Optic-Electric, Han's Laser, and Henan Shijia Photons Technology are also expected to see their earnings double.
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