To The Moon

$BABA-W(09988)$ , $SMIC(00981)$ and $GDS-SW(09698)$ ore representative companies in the AI industry chain within the Hong Kong stock market.

They each hold leading positions in three key segments: AI models/cloud computing, AI chips, and data centers. Together, these three companies form a complete domestic AI industry ecosystem—AI models (Alibaba) → chip manufacturing (SMIC) → computing infrastructure (GDS)—giving them strong strategic positioning.

As domestic AI models such as DeepSeek and Tongyi Qianwen gain rapid adoption, the demand for AI computing power continues to grow, and these companies are well-positioned to benefit.

Here's the logic:

✅ Alibaba: AI Model + Cloud Dual Engines

• AI Model: Its self-developed large language model "Tongyi Qianwen" is one of the mainstream Chinese LLMs, ranked alongside DeepSeek and Kimi.

• Cloud Services: Alibaba Cloud is the largest public-cloud vendor in China; AI-related cloud revenue is growing fast and recently overtook state-owned telecom clouds for the first time.

• Capex: Alibaba announced an additional RMB 380 billion (≈ US$ 53 bn) over the next few years to expand AI infrastructure, with room for further increases.

✅ SMIC (0981.HK): Core Foundry for Domestic AI Chips

• Local Substitution: SMIC is the most advanced mainland-China wafer fab and the only viable volume foundry for home-grown AI chips.

• AI Chip Demand: Surging orders for training & inference chips (Cambricon, Hygon, Baidu Kunlun, etc.) flow directly to SMIC’s mature and N-1 nodes.

• Price Action: Up >80 % YTD in 2025 as investors price in a multi-year AI-foundry up-cycle.

✅ GDS Holdings (09698.HK): Leading AI Data-Center Operator

• IDC Leader: Largest third-party colocation provider in China; anchor customers include Alibaba Cloud, Tencent Cloud and AWS China.

• AI-Driven Utilisation: GPU-heavy AI workloads lift power density and occupancy to three-year highs; new pre-leasing at record levels.

• Price Action: Stock has doubled since Feb-25 on expectations of a data-center “super-cycle” fueled by domestic LLM training.

And what are the investment expectations?

📈Here is the Investment Outlook (not investment advice)

🔍 Summary

Together the three companies form a complete “model → chip → data-center” AI value chain inside China. As domestic LLMs (DeepSeek, Tongyi, etc.) scale, demand for local AI compute keeps rising, reinforcing their strategic moats.

Investors should still watch for technology bottlenecks, policy shifts and supply-chain shocks, and size positions according to personal risk tolerance.

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