Report Highlights Review

of the overall market and communication segments

Weekly market: This week (2025.01.13-2025.01.17), the Shanghai Composite Index rose 2.31%, the Shenzhen Component Index rose 3.73%, and the ChiNext rose 4.66%. Shenwan Communications rose 6.13% this week.

Considering the continued high prosperity of the communications industry, AI, 5.5G and satellite communications continue to promote the development of the industry, and we give the communication and electronics industry a "Recommended" rating.

Sub-industries: This week (2025.01.13-2025.01.17) Among the third-level sub-industries of the communication sector, communication network equipment and devices rose the most, with an increase of 8.70%, and other communication equipment rose the lowest, with an increase of 4.13%, and each sub-sector mainly showed an upward trend this week.

In terms of individual stocks: This week (2025.01.13-2025.01.17), the number of stocks that rose, fell and flattened in the communication sector accounted for 87.40%, 7.87% and 4.72% respectively. Among them, in terms of the analysis of the gainers, Shijia Photonics (25.16%), Tianfu Communication (22.71%), and *ST Information and Communication (21.23%) ranked among the top three.

Nvidia may launch a new CPO switch in March this year

According to the supply chain, Nvidia will launch a new CPO (co-packaged optical) switch at the GTC conference in March, and it is expected that the trial production work will be carried out smoothly and mass production will be available in August.

The CPO switch is in the pre-production phase and could be ready for mass production in August this year if all goes well. It is reported that its internal ASIC chip will be built by TSMC. Up to now, TSMC, Shangquan Optical Fiber and other related supply chain companies are actively preparing.

In terms of product performance, the CPO switch is expected to support 115.2Tbps signal transmission.

At present, TSMC has verified a small general-purpose optical engine with a transmission rate of 1.6Tbps and is testing a 3.2Tbps product, and the former will enter mass production in the second half of 2025 at the earliest. However, to achieve the target transmission speed of NVIDIA's CPO switch, at least 36 optical engines are required.

The supply chain further speculated that due to the relatively complex design of the current NVIDIA GB200 NVL72 cabinet, this server solution for high-performance computing faces potential power consumption and cooling issues.

Suggested focus direction: Computing power industry chain, satellite Internet

Recommended target:

Computing power: Zhongji Innolight (300308. SZ）； Xinyisheng (300502. SZ）； Yuanjie Technology Co., Ltd. ( 688498.SH ) ; Shanghai Electric Co., Ltd. (002463.SZ); FII (601138. SH)

Satellite Communications: Hager Communications (002465. SZ）； Fujitec (835640.HK) BJ）； China Telecom (601728. SH）； Fudan Microelectronics(688385. SH）。

Risk Warning: The

risk of uncertainty in the international political environment and the risk that the market demand is less than expected.