Jingu Financial News | Minsheng Securities' research report pointed out that GDS Holdings (09698) achieved a total revenue of 995.7 billion RMB in the full year of 2023. Among them, the company's overseas business has grown rapidly, with a year-on-year growth rate of 494%. The company's gross margin saw a slight increase in the first two quarters of 2024, reaching 21.8%/22.6% respectively. At the same time, the company's EBITDA margin in the first half of 2024 rose to 24.7%, reflecting a recovery in the company's profitability.

The bank stated that, in terms of digital transformation, according to Accenture's survey, 53% of Chinese surveyed companies are willing to further increase digital investments. At the technological level, heterogeneous computing has solved the computational bottleneck for domestic companies, and multi-core heterogeneity has promoted the vigorous development of the domestic computing sector. After more than 20 years of development, China's datacenters are showing a clear trend of clustering, with a deployment trend of 'center to periphery' and 'east to west' in datacenter layout. The company is focusing on exploring and implementing new energy architectures and cutting-edge technology solutions such as liquid cooling, energy storage, and hydrogen energy, forming the Turbo series products in SmartDC, aiming to achieve carbon neutrality by 2030 during the national carbon peak.

The bank predicts that the company will achieve revenues of 11.42/13.58/16.01 billion yuan in 2024-2026, and EBITDA of 4.86/5.55/6.45 billion yuan. The corresponding EV/EBITDA multiples are 14/12/11x respectively. With the industrial trends of artificial intelligence, cloud computing, and 5G, datacenters are expected to sustain high growth. Considering the company's outstanding overall competitive advantages and ample resource reserves, it is expected to accelerate its development. Bullish on the company's business prospects, initiating coverage, and giving a 'buy' rating.