Despite consecutive years of losses, Innoscience’s stock price has surged dramatically—can its market capitalization realistically reach RMB 100 billion?

According to publicly available data: • In the initial phase following its listing in December 2024, the stock price fluctuated between HK$30.86 and HK$58.25; • By July 2025, the share price rose further, trading within a range of HK$41.75 to HK$79.20; • In early August 2025, the stock hit an all-time high of HK$73.55—doubling from its IPO price—and pushed the company’s market capitalization beyond HK$51.5 billion. Notably, between July 3 and August 5, 2025, Innoscience’s share price surged from HK$36.80 to HK$75.15—a rise of over 100%—making it a rare example of a high-growth tech stock in the Hong Kong market. Historically, Hong Kong investors have tended to undervalue hard-tech companies. Innoscience’s decision to list in Hong Kong was, in fact, a pragmatic necessity. This sharp price surge was primarily driven by Innoscience’s announcement in August 2025 of a strategic partnership with NVIDIA to jointly promote the large-scale adoption of an 800V DC (direct current) power architecture in AI data centers. Compared with the conventional 54V power supply approach, this new architecture delivers significant improvements in energy efficiency, thermal loss reduction, and system reliability—making it well-suited to meet the projected hundredfold growth in computing power demand. Innoscience stated that its GaN devices possess full-chain capability—from 800V input to output voltages ranging from 15V to 1200V—enabling the construction of complete gallium nitride (GaN) power systems capable of meeting the power supply requirements of megawatt-scale AI computing infrastructure. This development not only enhances Innoscience’s strategic value in data center applications but also signals a pivotal turning point for the large-scale deployment of GaN technology in high-power AI scenarios. Interestingly, on May 21, 2025, after U.S. market hours, Innoscience’s competitor Navitas Semiconductor (NVTS) similarly announced a collaboration with NVIDIA to develop next-generation 800V high-voltage DC (HVDC) architecture—and its stock price soared 180%–200%. Reduced losses: Key financial comparisons Milestones in Innoscience’s establishment (source: Yufeiyuan Research Institute) Innoscience is a globally leading integrated device manufacturer (IDM) specializing in the research, design, production, and sales of gallium nitride (GaN) power devices. The company successfully listed on the Main Board of the Hong Kong Stock Exchange on December 30, 2024, under stock code 02577.HK. This IPO marked a critical milestone in the company’s development, providing robust capital support for subsequent capacity expansion and technological R&D. Revenue achieves leapfrog growth Innoscience’s revenue performance over recent years reflects strong growth momentum. In 2023, the company achieved revenue of RMB 593 million; in 2024, revenue is projected to increase to approximately RMB 828 million—a substantial year-on-year growth of 39.8%. This growth rate reflects notable success in expanding its market presence in the GaN technology sector, with continued revenue contributions from its discrete GaN devices, integrated circuits, wafers, and modules. Year-on-year revenue comparison (source: Yufeiyuan Research Institute) Profitability: Losses narrowing, gross margin gradually improving Although revenue has grown significantly, profitability remains the core focus of market attention. Innoscience remains in a strategic loss-making phase, as its high-cost structure—centered on market expansion and R&D investment—continues to weigh on its profit performance.

International investment banks unanimously express optimism toward Innoscience.

I. Trading rationale for Innoscience (02577.HK): 1. Dongzi Securities: Within the past 90 days, 10 institutions have issued ratings for this stock—6 recommending “Buy” and 4 recommending “Add.” The average target price set by these institutions over the past 90 days is HK$49, representing a 29% premium over the current share price. According to Dongzi Securities’ big-data analysis, the company has attracted investments from STMicroelectronics and Jiangsu State-owned Capital Fund. (Date: April 28, 2025) 2. CLSA: Financially, the company has incurred losses over the past several years; however, with growing market demand and expanded production capacity, profitability is expected to be achieved in 2027. Revenue stood at RMB 593 million in 2023 and is projected to reach RMB 8.01 billion by 2028—a compound annual growth rate (CAGR) of 76%. Gross margin was -61.1% in 2023 but is forecast to improve to 48% by 2028. Operating expense ratios are also expected to decline progressively as economies of scale take effect. Innoscience holds a leading position in the GaN power semiconductor market, and demand for GaN is surging rapidly amid the growth of electric vehicles (EVs), AI servers, and renewable energy sectors. CLSA has assigned the company an “Outperform” rating. (Source: Reuters, cn.tradingview.com/news… Date: April 28, 2025) 3. China Merchants Securities: Benefiting from rising GaN application penetration and market expansion, the company’s revenue grew from RMB 68 million in 2021 to RMB 828 million in 2024, and is projected to reach RMB 3.098 billion by 2027—a CAGR of 55.2% between 2024 and 2027. As business scale expands, Innoscience’s gross margin and net profit margin are expected to improve progressively: gross margin is projected to turn positive in 2025, and net profit margin is expected to turn positive in 2027. Based on a 30x P/E multiple for 2030 (the five-year industry average), with a weighted average cost of capital (WACC) of 12.0% and an RMB/HKD exchange rate of 1.07, the firm assigns Innoscience a “Buy” rating. (Source: Reuters, cn.tradingview.com/news… Date: April 28, 2025) II. Trading rationale for PTK New Materials (300811): 1. Dongzi Securities: Within the past 10 days, four institutions have issued ratings for this stock—two recommending “Buy” and two recommending “Recommended.” The average target price set by these institutions over the past 10 days is RMB 52, representing a 30% premium over the current share price. According to Dongzi Securities’ big-data statistics, the stock has seen three consecutive days of net inflows from major institutional funds. (Date: April 28, 2025) 2. AVIC Securities: The company’s core business—metal powder core components—is rooted in the new-energy sector. By actively extending its footprint upstream into chip inductors for computing infrastructure, and forging business partnerships with world-leading GPU chipmakers, PTK has further solidified its industry standing as an “expert in metallic soft magnetic materials and their applications.” Its second growth curve has already taken shape, positioning it to fully capitalize on the high-speed development dividends of the AI era.

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