Guosen Securities Highlights MLCC and CCL as Top Picks for July Amid Price Hikes, Notes Strong Domestic Computing Demand Driven by Local AI Models

Stock News
Jul 02

Guosen Securities has released a research report stating that the intensive release of model iterations by domestic large model manufacturers in June, along with the global success and recognition of Zhipu's GLM 5.2, is driving robust demand within the domestic computing power industry chain.

Since June, the firm has observed continuous price increases for global leasing of products like the H100 and B200, with companies such as Anthropic, OpenAI, and Zhipu maintaining rapid growth in Annual Recurring Revenue (ARR).

Looking ahead to the second half of 2026, with Nvidia's Vera Rubin 200 moving towards mass production, the firm anticipates that supply within the Nvidia ecosystem will remain tight. Consequently, it recommends focusing on segments experiencing price increases, highlighting overseas memory, MLCC (Multi-Layer Ceramic Capacitors), and CCL (Copper Clad Laminate).

Review of June Market Performance

The Hang Seng Tech Index declined in June compared to the previous month, with a single-month drop of 12.9%. Over the same period, the Nasdaq Internet Index fell by 8.2% for the month.

Individual stock performances within the internet sector were mixed. In Hong Kong, Kingsoft Corporation Limited, NetEase, Inc., and Tencent Holdings Limited were the top three performers for the month. In the US market, Zhihu Inc., Sea Limited, and Kanzhun Limited (BOSS Zhipin) were the top three performers.

From a valuation perspective, the Hang Seng Tech Index's price-to-earnings ratio decreased from the previous month, with a trailing twelve-month (TTM) PE of 21.86x, placing it at the 24.68th percentile since the index's inception. The Nasdaq Index's valuation also declined, with a TTM PE of 39.32x, at the 58.35th percentile over the past decade.

Key Developments in Artificial Intelligence

1) OpenAI: Acquired Ona, released GPT-Bidi-1, and secured Samsung's largest order.

2) Google: Launched a mutual translation model and a text diffusion model.

3) Anthropic: Introduced Claude Fable 5 and Mythos 5.

4) Nvidia: Partnered with the LG Group to build AI factories and advance new businesses like physical AI.

5) Tencent: Initiated internal testing for AI ecosystem integration within WeChat, open-sourced operators, and launched a payment card.

6) Alibaba: Open-sourced a scientific large language model and introduced a Gaokao (college entrance exam) Agent alongside a video generation model.

7) ByteDance: Conducted grey-scale testing for a ride-hailing service within its Doubao app, and its Volcano Engine released several new models.

8) Moonshot AI: Open-sourced its new-generation programming-specific model, Kimi K2.7 Code.

9) iFlytek: Unveiled its intelligent space Agentic architecture, SpaceMind.

10) Xiaomi: Released a programming assistant, the official version of Claw, and a whole-house smart solution.

11) Ant Group: Began internal testing for Qmuse.

Internet Industry Updates

1) Gaming: The title "Yihuan" contributed to nearly 30% growth in overseas revenue for domestic games, and NetEase is preparing for a dual primary listing.

2) Fintech: Payment institution reserve funds grew 3% year-on-year in May.

3) E-commerce: The 618 shopping festival concluded smoothly, with platforms increasing investment in new scenario layouts.

4) Local Services: Consumption activity rose during the 618 festival and Dragon Boat Festival, sustaining positive momentum in local services and instant retail.

5) Short Video: AI-generated micro-dramas were formally incorporated into a tiered regulatory classification system.

Risk Factors

The report highlights several risks, including policy-related uncertainties, the potential for a worsening competitive landscape in the short video sector, the risk of macroeconomic downturns leading to advertising revenue growth falling short of expectations, and the possibility that new game releases from companies may be delayed or underperform.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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