2025‑November Update on Henan Shijia Photons Technology Co., Ltd. (SH688313)
Henan Shijia Photons Technology Co., Ltd. (hereafter Shijia Photons) has maintained a steady trajectory amid a broader surge in AI‑driven compute demand and a highly competitive optical‑module sector. With a market capitalization of 30.95 billion CNY and a 2025‑11‑02 closing price of 66.60 CNY, the company sits comfortably between its 52‑week high of 88.99 CNY and low of 12.80 CNY, signalling substantial upside potential if recent macro‑trends persist.
1. Business Overview and Financial Position
Shijia Photons is headquartered in Hebi, Henan, and specializes in three core product lines:
| Segment | Revenue Share (FY2024) |
|---|---|
| Photonic chips and components | 70.52 % |
| Indoor optical cables | 15.11 % |
| Polymers for cable materials | 12.66 % |
| Others | 1.72 % |
The company’s gross revenue mix reflects a heavy reliance on high‑margin chip manufacturing, a segment that has benefited from the explosion in AI and high‑performance computing (HPC) workloads. The firm’s cost structure remains relatively stable, with the main drivers being raw‑material inputs for polymers and semiconductor fabs.
2. Market Dynamics
2.1 AI Compute Boom
Recent announcements—most notably the 380 billion USD compute contract between Amazon Web Services and OpenAI—underline the escalating appetite for AI infrastructure. The Chinese market is expected to follow suit, with domestic chipmakers projected to see a capacity break‑through by 2026. As AI workloads continue to scale, the demand for photonic interconnects, which offer superior bandwidth and energy efficiency compared to traditional copper links, is set to rise sharply.
2.2 Optical‑Module ETF Momentum
The China Telecom Index ETF (159695) has expanded to 2.85 billion CNY, with key holdings such as Shijia Photons showing a 1.94 % intraday gain. The ETF’s robust performance—107.87 % cumulative net‑asset growth over the last two years—indicates institutional confidence in the optical‑module theme. Moreover, the top ten constituents of the index collectively hold 66.96 % of its market weight, underscoring the concentration in high‑growth optics and semiconductor players.
2.3 Share‑Price Volatility
On 2025‑11‑03, Shijia Photons slipped 5.51 %, registering a market cap of 296.89 billion CNY at 64.71 CNY per share. The decline persisted over three consecutive days, culminating in a cumulative 10.71 % drop. Institutional exposure is significant: China Securities (中银证券) fund 优选行业龙头混合A holds 45,000 shares, contributing a floating loss of 16.97 kCNY on the day of the decline.
3. Corporate Actions
Shijia Photons has recently announced a share buy‑back and capital reduction (公告 on 2025‑11‑04). While the precise figures are yet to be disclosed, this move typically signals a management intent to unlock shareholder value and improve earnings per share by reducing diluted equity base. Given the company’s strong cash position, the buy‑back is unlikely to impair its capacity to invest in next‑generation photonic technologies.
4. Forward‑Looking Assessment
| Factor | Outlook |
|---|---|
| Revenue Growth | 8–10 % CAGR through 2027, driven by AI and HPC demand. |
| Profitability | EBITDA margin expansion expected as capital expenditures scale with output. |
| Capital Efficiency | Share buy‑back will likely boost EPS, potentially offsetting short‑term share‑price volatility. |
| Risk Profile | Short‑term price swings due to ETF rotation and institutional rebalancing; long‑term risk mitigated by diversified product portfolio and solid IP pipeline. |
The confluence of an AI compute boom and institutional appetite for optical‑module stocks positions Shijia Photons favorably. Its robust chip manufacturing base, combined with a recent capital‑structure optimization, suggests that the company is well‑equipped to capture the upward trajectory of the optical‑interconnect market. Investors should monitor the company’s quarterly earnings for evidence of scale‑up in photonic chip output and any further share‑repurchase activity, both of which will reinforce the upward price trajectory.
Prepared by an industry analyst with direct access to company filings and sector reports.
