Zhongji Innolight's Fundamentals Remain Intact

Dow Jones08-03

0303 GMT - Zhongji Innolight's fundamentals remain intact, Nomura analysts say in a note. There are multiple growth drivers for Innolight over 2026-2028, including the 1.6T optical transceivers upgrade, the commercialization of 2.4T optical modules and near-field packaging optics in 2027, the analysts say. Nomura thinks market concerns about new entrants into the market are overdone, as technology barriers will be higher amid tech upgrades. Supply bottlenecks for upstream material and components may gradually ease in 2H thanks to accelerated capacity expansion and Innolight's supply chain management, they note. The analysts expect Innolight to maintain a 30%-35% market share in the global AI data center optical transceiver market in 2026-2028. Nomura puts Innolight's H shares target price at HK$1,595.00. Shares are last at HK$1,040.00.

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