China Securities Co., Ltd.: No need to worry too much about the expansion of the baton wave GPT-5.6 released, continue to recommend the AI industry chain.

China Securities Co., Ltd. released a research report stating that since the beginning of the year, the price of optical fibers has significantly increased, leading to a significant improvement in investment returns and prompting many companies to initiate plans to expand production of optical fibers. The company believes that the development of AI has significantly driven the demand for optical fibers, and the industry is still experiencing a supply shortage. While many companies plan to expand production, there are concerns about whether they have sufficient experience in manufacturing optical fibers and whether they can expand production as scheduled. Even if production is expanded as planned, most of the capacity release will not occur until the second half of next year or later, so the impact on the industry's supply and demand situation for this year and even next year is not significant. Furthermore, the demand for AI may be even stronger, so there is no need to worry excessively in the short term. Additionally, OpenAI has released a new generation AI model GPT-5.6 series, which includes versions Sol, Terra, and Luna. The company continues to be optimistic about large AI models and recommends continued focus on the AI industry chain and advises continued strategic allocation of AI computing power industry chain. Key points from China Securities Co., Ltd.: Wave of optical fiber and optical bar production expansion is coming. Since the beginning of the year, the price of optical fibers has significantly increased, leading to a significant improvement in investment returns and pushing many companies to initiate plans to expand production of optical fibers. For example, in April, Hengtong Optic-Electric started a project to expand production of 800 tons of optical bars in Inner Mongolia, Far East Smarter Energy announced a fundraising of 2 billion yuan to build a new 1,800-ton artificial intelligence data center (AIDC) special optical fiber prefabricated bar in April, Tongding Interconnection Information announced plans to collaborate on building 600 tons of optical bars and 20 million fiber kilometers of optical fiber in May, Hoshine Silicon Industry filed for a 3,200-ton optical bar project in June, and Han's Laser Technology Industry Group announced plans to expand production of 2,000 tons of optical bars and 60 million fiber kilometers on June 25th. The company believes that the development of AI has significantly driven the demand for optical fibers, and the industry is still experiencing a supply shortage. Although many companies plan to expand production, there are concerns about whether most companies have sufficient experience in manufacturing optical fibers to expand production as scheduled. Additionally, even if production is expanded as planned, most of the capacity will not be released until the second half of next year or later, so the impact on the industry's supply and demand situation for this year and even next year is not significant. Furthermore, the demand for AI may be even stronger, so there is no need to worry excessively in the short term. Recently, OpenAI officially released the new generation AI model GPT-5.6 series, which includes three versions: Sol, Terra, and Luna. The flagship version Sol set a record of 91.9% in the programming benchmark test TerminalBench 2.1, with network security capabilities close to ClaudeMythos5, but consuming only 1/3 of the output token resources. In the bio-medical benchmark test Genebench v1, the score of GPT-5.6 has improved by 17% compared to the previous generation. GPT-5.6 adopts a pricing strategy based on tiered basic capabilities, with the flagship model Sol maintaining a price of $5 per million token inputs. The balanced model, Terra, uses a $2.5 input price and performs similarly to GPT-5.5, suitable for daily development. The high-speed model, Luna, offers a $1 input price, triples throughput, and is suitable for batch processing. Anthropic announced that the U.S. government has informed companies that Mythos5 can be redeployed to a batch of U.S. institutions responsible for operating and maintaining critical infrastructure. The company is working to quickly restore the relevant usage permissions for these institutions. The company will continue to collaborate with the U.S. government to further expand the accessibility of Mythos5. The company believes that large models are still increasing their capabilities, and top model manufacturers are using tiered pricing strategies for model pricing by optimizing performance, such as OpenAI's introduction of the GPT-5.6 balanced model Terra (with comparable performance to the previous generation but significantly reduced costs) and the high-speed model Luna (increased throughput resulting in a significant drop in single-use costs), addressing enterprise customers' cost concerns about deploying AI in complex business scenarios. In addition, top AI models have begun to integrate national security and compliance barriers: Anthropic's Mythos5, with direct intervention by the U.S. government, has been the first to selectively relax restrictions on institutions responsible for maintaining critical infrastructure; and in the demonstration of GPT-5.6's capabilities, OpenAI clearly highlights the benchmark test results in network security and bio-medical fields. This indicates that the network and biochemical capabilities of top AI models have been strategically integrated, making AI models a core national asset. The company remains optimistic about large AI models. Top manufacturers are pushing for continuous cost reductions in large model inference costs through optimizations in underlying architectures, accelerating the commercialization of AI applications in high-frequency B-side scenarios. The company continues to recommend focus on the AI industry chain, and as technology iterates on the model side and the application ecosystem explodes, the demand for upgrading and expanding underlying computing power infrastructure will be further confirmed, suggesting continued strategic allocation to the AI computing power industry chain. Risk Caution International environmental changes impact the security and stability of the supply chains and may affect the progress of related companies expanding overseas. Tariff impacts exceed expectations; the development of the artificial intelligence industry is below expectations, affecting the demand for companies in the cloud computing industry chain; intensified market competition leading to rapid decline in gross profit margins; exchange rate fluctuations impact the foreign exchange gains and gross profit margins of export-oriented enterprises, including ICT equipment, optical module/optical device sector companies; the development of the digital economy and Digital China construction are below expectations; the development of cloud computing business for telecom operators is below expectations; capital expenditures of operators and cloud vendors are below expectations; demand for communication modules and intelligent controllers are below expectations.