Hui Lyu Ecological Technology Groups Co Ltd: Riding a Wave of CPO‑Related Momentum
The Shenzhen‑listed landscaping specialist has found itself at the heart of a broader sectoral rally that has lifted a cluster of “CPO” (Compute‑Power‑Optimisation) and AI‑hardware themes. On November 6, the company’s share price surged to 18.93 CNY, a 9.99 % gain that pushed its market value above 14.8 billion CNY. The rally was driven not only by the company’s own announcements but also by a confluence of market‑wide catalysts that have reshaped investor sentiment across technology and industrial subsectors.
1. The Catalyst: Overseas Expansion into Optical Modules
Earlier in the week, Hui Lyu disclosed a strategic partnership between its Malaysian subsidiary, Jun Heng Technology, and a third‑party buyer to acquire a 7,844‑square‑meter industrial site in Penang for roughly 4.1 million CNY. The acquisition is earmarked for the construction of a new optical‑module facility – a segment that falls squarely within the CPO umbrella. In a market that has been increasingly focused on high‑speed data transmission, the company’s move signals a shift from pure landscaping to high‑technology manufacturing, offering a fresh narrative for investors.
2. Market Context: The CPO Concept Takes Flight
The company’s upward trajectory coincided with a broader uptick in the “CPO” concept. On November 7, multiple sources reported a partial rebound in this theme, with notable gains in stocks such as Tiangong Communications (over 15 % rise), Changguang Huaxin, Huijie Ecological, Taicheng Guang, and Huatech. The narrative was bolstered by international news: U.S. light‑module leader Coherent reported a 15.8 billion USD revenue for its first fiscal quarter, surpassing expectations, while Google announced the forthcoming launch of its “Ironwood” next‑generation tensor processing unit (TPU). These developments positioned the CPO sector as a driver of growth in the technology space.
3. Sectoral Momentum: From AI Hardware to Chemical Powerhouses
Hui Lyu’s gains were part of a day‑long rally that saw the Shanghai Composite climb close to 1 % and rebound above the 4,000‑point threshold. The broader market benefited from a surge in several interrelated sectors:
| Sector | Key Highlights |
|---|---|
| Compute‑Power‑Optimisation (CPO) | Stocks such as East Mountain Precision and Hui Lyu jumped to limit‑price, while others like Hanwudi saw gains over 9 %. |
| Semiconductor & AI Hardware | Hanwudi and other chipmakers posted significant upside as investors chased higher‑margin technology plays. |
| Chemical & Metal | Chemical stalwarts (e.g., Yun Tianhu, Cheng Xing) and metal producers (e.g., China Aluminium) achieved record highs, reflecting optimism in industrial demand. |
| Energy & Power Equipment | Firms in power transmission and energy infrastructure, such as Moen Electrical, maintained strong performance, buoyed by the global shift toward renewable energy. |
These cross‑sector rallies created a contagion effect that amplified the appeal of companies positioned at the nexus of traditional industry and emerging technology—an archetype embodied by Hui Lyu.
4. Investor Sentiment and Valuation
Despite a price‑earnings ratio of 166.43, Hui Lyu’s valuation can be rationalised by its dual identity: a mature service provider with steady cash flows and a nascent high‑technology arm with substantial growth prospects. The company’s market capitalization of approximately 13.5 billion CNY reflects a premium that investors are willing to pay for potential diversification into optical modules and related infrastructure.
5. Outlook
The confluence of a strategic overseas expansion, a bullish CPO theme, and a broadly positive market environment has set the stage for continued upside. If Hui Lyu successfully transitions a portion of its operations into optical‑module manufacturing, it could capture a share of the rapidly expanding 5G/6G infrastructure market. Simultaneously, its core landscaping business provides a stable income base, mitigating the risks inherent in a high‑growth venture.
For investors, the key will be to monitor:
- Execution of the Penang facility – timelines, cost controls, and early production milestones.
- Integration of optical‑module capabilities into existing supply chains.
- Sustained demand for CPO‑related products amid global supply‑chain shifts.
In the short to medium term, Hui Lyu’s performance will likely remain tightly coupled to the health of the CPO theme and the broader technology rally. Over the longer horizon, the company’s diversification strategy could transform it from a regional landscaping provider into a player on the international stage of high‑speed data infrastructure.
