CITIC Securities: The high prosperity of the computing power industry continues to be verified, and there may be room for valuation improvement.

CITIC Securities Research Report indicates that the AI computing power sector is constantly catalyzing. Companies related to this sector are experiencing rapid growth in performance forecasts. Meta will invest billions of dollars to build several large data centers. OpenAI announced the launch of a general-purpose AI agent in ChatGPT. NVIDIA will resume sales of H20 in China and announce the launch of a new, compliant GPU targeting the Chinese market. CITIC Securities continues to recommend the computing power sector: first, core targets of North American computing power chains with sustained high growth in performance and still at historically low valuations; second, companies expected to benefit from spillover demand and achieve breakthroughs in customers or market share; third, upstream scarce links; fourth, focus on 1.6T optical modules and the CPO industry chain with the bulk shipment of GB300. They also suggest paying attention to domestically-produced computing power chains. In addition, CITIC Securities believes that as large models are continuously iterated, the industry will move towards general artificial intelligence development, and AI applications are still worth looking forward to. With the IPO of Yushu, they recommend focusing on the AI end-side chip, module, and other industry chains. Furthermore, CITIC Securities continues to recommend telecom operators, military communications, and other sectors.