Although the artificial intelligence race is primarily focused on advanced semiconductors, a number of mainland Chinese listed companies produce many of the components needed to run data centers. “The United States relies on Chinese companies for almost 30% of its imports of AI-related products,” Michael Herson and Howes Song of 22V Research wrote in a June 21 report published in partnership with Analyst Hub Securities. “While China lacks the capacity to manufacture advanced chips at scale, it plays a central role in less glamorous parts of the data center supply chain, such as energy storage, transformers, critical minerals and chemicals,” the analysts said. “This quiet story is increasingly important for investors to pay attention to.” The 22V Research report noted that AI-related exports accounted for about half of China’s overall export growth this year, with many companies listed in Shenzhen. Hardware names have driven significant growth in Chinese stocks this year. The ChiNext index, which tracks Shenzhen-listed companies, has doubled in the past 12 months. The 22V Research report examined stocks in the CSI 300 index, which covers the largest companies traded in both Shenzhen and Shanghai. The report found that among the top 10 AI supply chain companies by market capitalization, all nine other companies, excluding battery giant CATL, had at least doubled their growth in the 12 months ending in May. The list includes Shenzhen and Hong Kong-listed Nvidia supplier Victory Giant, as well as Shenzhen-traded printed circuit board companies such as Dongshan Precision and Shengyi Technology. Sanhuan Group, also trading in Shenzhen, is a manufacturer of multilayer ceramic capacitors (MLCCs), which are used to store and release energy within chips. According to the report, Nvidia has nearly tripled the amount of MLCC included in its latest Vera Rubin AI system. On the server side, Foxconn Industrial Internet, a subsidiary of the Apple iPhone supplier, was named in the 22V top 10 list along with energy company Sungrow Power. Foxconn Industrial Internet said cloud computing jumped 88.7% to 602.68 billion yuan ($88.67 billion) in 2025, becoming the biggest contributor to growth. Three of the companies on the 22V list were optical and networking names: InnoLight, Eoptolink, and TFC. Optical technology allows semiconductors to process signals at near-light speeds. JPMorgan analysts highlighted fiber optic components in a June 12 report on China’s AI advantages in legacy chips and data center connectivity components. “Opticals is a major ‘pick-up’ channel,” JPMorgan analysts said. “AI data centers require high-density, high-speed links and are reported to use 5-10 times more fiber than traditional server rooms, or even more. With some overseas order books now extended to 2027-28, China Customs data shows that fiber/cable export value has risen to about 4 times the previous year’s level, with an average export price of about 3. Chinese tech companies generally still trade at lower valuations than their U.S. peers, but interest from local investors has increased as well. Recent stock price gains have pushed the market capitalization of InnoLight and Foxconn Industrial Internet, along with CATL, into the 1 trillion yuan range. —CNBC’s Michael Bloom contributed to this report.
