There is no ivory tower in this field, only the pure entrepreneurial spirit of garage startups and the innovative power built together with the Community.
——DeepSeek
DeepSeek will officially launch "Open Source Week" on February 24, 2025, planning to open source a project every day for five consecutive days, with the first open sourced codebase being Flash MLA, which can extract the potential of graphics cards, enhance speed, and significantly reduce costs.
The first project Flash MLA can be understood as an "AI acceleration tool" specifically designed for high-performance graphics cards (Hopper GPU). Its core function is to make AI models (like chatbots and text generation tools) more efficient when processing data of varying lengths. For example, when the AI processes both long and short sentences simultaneously, Flash MLA can dynamically adjust resource allocation to avoid wasting computing power.
Some netizens pointed out that FlashMLA's computing speed has reached 8 times the industry average, even exceeding the H800's peak transmission of 1681GB/s.
This means that by using FlashMLA, the same amount of tasks can be deployed with fewer Hopper GPU Servers, without expensive hardware upgrades, greatly reducing inference costs.
Upon seeing the open-source project on the first day, netizens on X couldn't wait to speculate about the major content on Day 5, with many guessing: "Could it be AGI?"
The popularity of DeepSeek not only disrupts the cost of AI but also rekindles investors' optimism towards AI innovation in China, leading to an increase in the valuation of Chinese assets. DeepSeek's breakthrough is seen as proof of China's AI field's ability to advance from "1 to 100" in application capabilities, prompting investors to re-evaluate the valuation gap between Chinese and American tech stocks and driving the reassessment of Chinese tech assets.
Since the beginning of the year, as the popularity of DeepSeek has fermented, $Nasdaq China Golden Dragon Index (.HXC.US)$ and $Hang Seng TECH Index (800700.HK)$ the increases have reached 18% and 29% respectively. In terms of sectors, industries such as AI applications, Telecommunications and Equipment, and Intelligent Driving are favored by capital, subtly revealing an industry chain of Deepseek+. So, which industries still have opportunities?
Futu News has compiled a list of beneficiary stocks from the Hong Kong stock market for mooer to reference:
These include:
AI large models: $Alibaba-W (09988.HK)$ 、 $TENCENT (00700.HK)$ 、 $Baidu Group-SW (09888.HK)$ 、 $SENSING-W (00020.HK)$ ；
Morgan Stanley predicts that Alibaba Cloud's revenue will double within three years, increasing from 118 billion yuan in the 2025 fiscal year to 240 billion yuan in the 2028 fiscal year. The bank noted that after the release of the DeepSeek model, the demand for Alibaba Cloud has increased significantly, with inference demand accounting for 60-70% of the incremental demand. Revenue from AI-related products has achieved triple-digit growth for six consecutive quarters.
Today, TENCENT's first AI-native app, Yuanbao, has surpassed Doubao, rising to second place on the free app download chart in China's Apple App Store.
Goldman Sachs believes that the competitive landscape of China's Internet industry is gradually diverging into two major camps: AI Infrastructure and AI Applications. Among them, Alibaba, with its strong Cloud Computing Service infrastructure, has become a key participant in AI Infrastructure; while TENCENT, with its powerful ecosystem and user experience in C-end applications, has become a core beneficiary in the AI application field.
Semiconductors include: $Semiconductor Manufacturing International Corporation (00981.HK)$ 、 $HUA HONG SEMI(01347.HK)$ 、 $ASMPT(00522.HK)$ 、 $SHANGHAI FUDAN (01385.HK)$ ；
Core chip manufacturing companies such as Semiconductor Manufacturing International Corporation and HUA HONG SEMI are closely related to domestic computing infrastructure. If the capital expenditure arms race for AI continues domestically, the prosperity of the chip sector is expected to rise.
Data, Cloud Computing, Software include: Kingsoft Cloud (03896.HK). 、 $GDS-SW(09698.HK)$、 $SUNEVISION Group (01686.HK)$ 、 $KINGDEE INT'L (00268.HK)$ 、 $CHINASOFT INT'L (00354.HK)$ 、 Kingsoft (03888.HK) 、 $Weimob Inc. (02013.HK)$ ；
UBS Group believes that investors might be overly focused on the absolute value of unit rent in China’s IDC being lower than that of other markets, while neglecting the cost advantages brought by the efficient execution of Chinese projects. With an increase in the certainty of large-scale orders and the further stimulation of AI demand by emerging technologies such as DeepSeek, the growth potential of China’s IDC companies is expected to be further unleashed. With the potential for higher project ROI, the valuation of China’s IDC will catch up with Global peers.
Telecommunications and equipment include: $CHINA TELECOM(00728.HK)$ 、 $ China United Network Communications (00762.HK)$ 、 $CHINA MOBILE(00941.HK)$ 、 $ZTE (00763.HK)$ 、 $YOFC(06869.HK)$ 、 $CHINA TOWER(00788.HK)$ ；
Galaxy Securities' research report points out that the three major telecommunications operators have fully accessed DeepSeek, which, due to its lower computational power cost configuration, is expected to reduce the positive cycle of operators' computational investment and output, leveraging the channel advantages of operators to achieve rapid development of AI applications and increase market share.
Huaxin Securities points out that the sales of high-speed Copper cables are continuously increasing, serving as connections for Servers and interconnections in decoupled Switches and Routers. It is expected that from 2023 to 2027, the compound annual growth rate of high-speed Copper cables will be 25%, with shipments expected to reach 20 million units by 2027. It is reported that Yangtze Optical Fibre's subsidiary, Changxin Sheng, mainly focuses on AEC, ACC, DAC, and Copper cables.
AI-related applications include: Meitu Inc (01357.HK) 、 $UBTECH (09880.HK)$ 、 $CHINA LIT(00772.HK)$ 、 Ali Health ($00241.HK$) 、 $pa gooddoctor(01833.HK)$ 、 MedWit Technology (02158.HK) 、 $JD HEALTH (06618.HK)$ 、 $KUAISHOU-W(01024.HK)$ 、 $Bilibili-W(09626.HK)$ 、 Kingsoft (03888.HK) 、 $XD INC (02400.HK)$ 、 Fourth Paradigm (06682.HK) And;
CICC believes that the current wave of technological equality and accelerated penetration of large models triggered by DeepSeek in China will continue to bring positive changes to both the supply and demand sides of the AI application sector, remaining bullish on the AI application sector.
Smart driving, Auto Parts include: $BYD COMPANY(01211.HK)$ 、 $Geely(00175.HK)$ 、 $DONGFENG GROUP(00489.HK)$ 、 $Guangzhou Automobile Group (02238.HK)$ 、 $Great Wall Motor(02333.HK)$ 、 $LEAPMOTOR (09863.HK)$ 、 $SpeedTech Innovations (02498.HK)$ 、 $Nanfang Black Sesame Group and Intelligence (02533.HK)$ 、 $Siasun Robot&Automation-W(09660.HK)$ 、 $NEXTEER(01316.HK)$ 、 $MINTH GROUP(00425.HK)$ ；
China Galaxy stated that DeepSeek significantly improves training efficiency and reduces computing costs under limited hardware conditions, while also achieving a substantial increase in model performance. In terms of smart driving applications, the demand for computing power at the vehicle end has decreased, leading to a reduction in cloud model training costs and significant cost savings. Additionally, DeepSeek is an open-source model, lowering the technical threshold and benefiting small and medium-sized manufacturers or those just beginning to focus on smart driving.
Mobile phones and Electric Appliances include: $XIAOMI-W(01810.HK)$ 、 $BYD ELECTRONICS(00285.HK)$ 、 $AAC TECH (02018.HK)$ 、 $SUNNY OPTICAL(02382.HK)$ 、 $LENOVO GROUP(00992.HK)$ 、 $ Q TECH (01478.HK) $ 。
Citi published a report stating that DeepSeek has a positive impact on the Consumer Electronics supply chain, accelerating hardware specifications upgrade and AI device replacement. At the same time, it is believed that the short-term demand for graphics processing units (GPUs) is solid, while in the long term, the penetration rate of special application chips is expected to increase. The bank believes that DeepSeek will help accelerate the proliferation of cost-effective and high-performance AI applications.
Additionally, regarding the beneficiary stocks in the US stock market, Futu News previously published an article."Under the Impact of DeepSeek, Who Will be the Winner? These US Stocks are Expected to Welcome a 'Golden Era'!"It was also mentioned that DeepSeek's technological breakthrough has reduced the overall cost of AI services, enabling more traditional industries to deploy AI solutions with lower barriers.
Want to learn more about stocks benefiting from DeepSeek? Make good use of the 'Investment Theme' feature, go to Futubull>US Stocks>Investment Themes>DeepSeek Concept Stocks, and capture investment opportunities!
Editor/Somer
