HK/China Equity Long-Short

Osbert Tang, CFA

Equity Capital Markets

Zhongji InnoLight / Equity Capital Markets

<ul>
<li>The IPO of <a href="https://www.smartkarma.com/entities/zhongji-innolight" target="_blank" data-smartkarma-citation="entities:55331:1" rel="noopener">Zhongji InnoLight (3308 HK)</a>, a leading global provider of optical interconnect solutions, which seeks HK$54.5bn, is the largest since 2019.</li>
<li>Its FY25-28F EPS CAGR will reach 89.8%, underpinned by the jump in revenue and expansion in margin. Its 1Q26 net profit has already surged by 262.3%.</li>
<li>The IPO is priced at a 17.7% HA discount. At a HK$1.2trn market capitalisation, pegging it to its A-share will give a price of HK$1,227, or a 21.5% upside.</li>
</ul>


The IPO of Zhongji InnoLight (3308 HK), a leading global provider of optical interconnect solutions, which seeks HK$54.5bn, is the largest since 2019.
Its FY25-28F EPS CAGR will reach 89.8%, underpinned by the jump in revenue and expansion in margin. Its 1Q26 net profit has already surged by 262.3%.
The IPO is priced at a 17.7% HA discount. At a HK$1.2trn market capitalisation, pegging it to its A-share will give a price of HK$1,227, or a 21.5% upside.


Zhongji InnoLight (3308 HK) IPO: Assessing the Valuation

Global Healthcare Analyst

Tina Banerjee

<ul>
<li>Zhongji Innolight launched Hongkong IPO to raise nearly HK$ 55B. They provide optical interconnect solutions that help transmit data through optical fibers and enable high-speed, energy efficient and low-latency connectivity.</li>
<li>Zhongji Innolight intends to use the proceeds for investment in R&amp;D, to expand global production capacity, enhance supply chain &amp; commercialization capabilities, for strategic acquisitions/investments and working capital.</li>
<li>Given the end market demand scenario, the valuation that Zhongji Innolight is seeking through this issue seems relatively justified and reasonable, considering the company’s market leadership position.</li>
</ul>


Zhongji Innolight launched Hongkong IPO to raise nearly HK$ 55B. They provide optical interconnect solutions that help transmit data through optical fibers and enable high-speed, energy efficient and low-latency connectivity.
Zhongji Innolight intends to use the proceeds for investment in R&amp;D, to expand global production capacity, enhance supply chain &amp; commercialization capabilities, for strategic acquisitions/investments and working capital.
Given the end market demand scenario, the valuation that Zhongji Innolight is seeking through this issue seems relatively justified and reasonable, considering the company’s market leadership position.


Zhongji Innolight IPO: Transmitting The Right Vibes For Investors Given The Strong Demand Optics

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/zhongji-innolight" target="_blank" data-smartkarma-citation="entities:55331:1" rel="noopener">Zhongji InnoLight (3308 HK)</a>, a leading global provider of optical interconnect solutions, has launched an H Share listing to raise US$7.0 billion.</li>
<li>I discussed the H Share listing in <strong><em><a href="https://www.smartkarma.com/insights/innolight-h-share-listing-the-investment-case" target="_blank" data-smartkarma-citation="insights:247130" rel="noopener">Innolight H Share Listing: The Investment Case</a></em></strong>. </li>
<li>The proposed AH discount of 23.3% (based on the close on 21 July A Share price) is attractive, and I would participate in the H Share listing.</li>
</ul>



Zhongji InnoLight (3308 HK), a leading global provider of optical interconnect solutions, has launched an H Share listing to raise US$7.0 billion.
I discussed the H Share listing in Innolight H Share Listing: The Investment Case. 
The proposed AH discount of 23.3% (based on the close on 21 July A Share price) is attractive, and I would participate in the H Share listing.


Innolight H Share Listing (3308 HK): Valuation Insights

Zhongji Innolight   / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/zhongji-innolight-co-ltd" target="_blank" data-smartkarma-citation="entities:6986:1" rel="noopener">Zhongji Innolight (300308 CH)</a> is a leading global provider of optical interconnect solutions. It is seeking to raise US$7 to US$8 billion.     </li>
<li>The principal products, optical transceivers, are compact devices that convert electrical signals into optical signals, and vice versa, to enable high-speed, energy-efficient and low-latency data transmission.</li>
<li>The investment case is based on strong market position, AI infrastructure-fuelled revenue growth, margin expansion, cash generation and a strong balance sheet. </li>
</ul>



Zhongji Innolight (300308 CH) is a leading global provider of optical interconnect solutions. It is seeking to raise US$7 to US$8 billion.     
The principal products, optical transceivers, are compact devices that convert electrical signals into optical signals, and vice versa, to enable high-speed, energy-efficient and low-latency data transmission.
The investment case is based on strong market position, AI infrastructure-fuelled revenue growth, margin expansion, cash generation and a strong balance sheet. 


Innolight H Share Listing: The Investment Case

Founder, CEO, GSBR Research

Garvit Bhandari

Founder, CEO

Leading Provider of Equity and Investment Research

GSBR Research

We are an independent equity research provider focused on covering global markets. The aim of the research is to provide an unbiased view of the fundamentals of the company.

Equity Bottom-Up

<ul>
<li>Q2 FY2026 revenue of $1.57B grew 40% YoY. Adjusted EPS of $1.64 rose 290%. FY2026 guidance raised to $6.3B, implying 32% growth at midpoint</li>
<li>Record $7.7B backlog, cloud providers at 46% of revenue, and RLS HyperRail wins support visibility into FY2027 and beyond.</li>
<li>The shares trade at a premium to optical peers, but backlog visibility, category leadership and an inflecting margin and cash profile justify that premium</li>
</ul>


Q2 FY2026 revenue of $1.57B grew 40% YoY. Adjusted EPS of $1.64 rose 290%. FY2026 guidance raised to $6.3B, implying 32% growth at midpoint
Record $7.7B backlog, cloud providers at 46% of revenue, and RLS HyperRail wins support visibility into FY2027 and beyond.
The shares trade at a premium to optical peers, but backlog visibility, category leadership and an inflecting margin and cash profile justify that premium


Ciena (NYSE: CIEN): Record Backlog and Near-Quadrupled EPS Validate the AI Optical Buildout Thesis

United States

Coherent Corp. designs engineered materials and optoelectronic components. The Company offers products to industrial, optical communications, military, life sciences, semiconductor equipment, and consumer markets. Coherent also manufactures semiconductor lasers and optics for high power industrial lasers, optical communications systems, datacenter connectivity, and 3D sensing.

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Coherent (COHR US)

Zhongji InnoLight (3308 HK) IPO: Assessing the Valuation

Zhongji InnoLight's IPO seeks HK$54.5bn, with strong growth projections. Priced at a 17.7% HA discount, there is potential for 21.5% upside if we...

Osbert Tang, CFA

Zhongji Innolight IPO: Transmitting The Right Vibes For Investors Given The Strong Demand Optics

Zhongji Innolight launch HK IPO to raise HK$55B for R&D, global expansion, acquisitions, and working capital, with justified valuation reflecting...

Tina Banerjee

Ciena (NYSE: CIEN): Record Backlog and Near-Quadrupled EPS Validate the AI Optical Buildout Thesis

Ciena has emerged as a primary beneficiary of the AI-driven optical build-out. Premium valuation justified by category leadership and positive...

GSBR Research

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Zhongji InnoLight (3308 HK) IPO: Assessing the Valuation

​Zhongji InnoLight's IPO seeks HK$54.5bn, with strong growth projections. Priced at a 17.7% HA discount, there is potential for 21.5% upside if we...

Osbert Tang, CFA

Zhongji Innolight IPO: Transmitting The Right Vibes For Investors Given The Strong Demand Optics

​Zhongji Innolight launch HK IPO to raise HK$55B for R&D, global expansion, acquisitions, and working capital, with justified valuation reflecting...

Tina Banerjee

Innolight H Share Listing (3308 HK): Valuation Insights

InnoLight, a leading global provider of optical interconnect solutions, has launched an H Share listing to raise US$7.0 billion. In this note, I...

Arun George

Innolight H Share Listing: The Investment Case

Innolight is a leading global provider of optical interconnect solutions. It is seeking to raise US$7 to US$8 billion. In this note, I discuss the...

Arun George

Ciena (NYSE: CIEN): Record Backlog and Near-Quadrupled EPS Validate the AI Optical Buildout Thesis

Ciena has emerged as a primary beneficiary of the AI-driven optical build-out. Premium valuation justified by category leadership and positive...

GSBR Research

Zhongji InnoLight's IPO seeks HK$54.5bn, with strong growth projections. Priced at a 17.7% HA discount, there is potential for 21.5% upside if we...

Zhongji Innolight launch HK IPO to raise HK$55B for R&D, global expansion, acquisitions, and working capital, with justified valuation reflecting...