Driven by the AI computing power wave, optical modules have emerged as one of the most certain links in this industry chain. As NVIDIA's GPUs are snapped up, the data torrents between data centers must be carried by optical modules — according to Goldman Sachs, the global optical module market is expected to reach $148 billion by 2028.

Against this backdrop, LIGENT (09856), the optical communications entity under Hisense Group, has passed the Hong Kong Stock Exchange hearing and launched its Hong Kong IPO subscription from September 14 to September 17, with Citigroup and CITIC Securities acting as joint sponsors. According to Zhitong Finance, LIGENT plans to globally offer approximately 172 million H-shares at an offer price of HK$32.96 per share, with each lot comprising 100 shares and an entry fee of approximately HK$3,329.24. The company is expected to list on the main board of the Hong Kong Stock Exchange on September 22. Market sources indicate that LIGENT has secured HK$15.545 billion in margin financing from brokers, representing an oversubscription of 26.42 times based on the public offering amount of HK$567 million. For this IPO, LIGENT has introduced 24 cornerstone investors, including Primavera Capital Fund, GBAHIL, CFTC Paragon SP, HK BVF I LPF, Orient Asset Management, GF Fund, E Fund, GigaDevice, Qianhai International Fund Management and other renowned domestic and international companies and institutions, with combined subscription amounts of approximately $340 million.

Data Center Optical Modules "Surging" While Optical Chips "Climbing"

According to the prospectus, LIGENT is a mature supplier of optical communications and optical connectivity products, dedicated to the R&D, manufacturing and sales of optical modules, optical chips and optical network terminals, serving domestic and international customers. The Qingdao-based company ranked fifth globally by optical module revenue in 2025 with a 4.0% market share, and third in China with a 10.1% share. It is also one of the few manufacturers globally with both optical module and optical chip R&D and mass production capabilities. The company's predecessor can be traced back to Ligent Tech, jointly founded in 2002 by Hisense Group and the team of returned scientist Huang Weiping. Over more than two decades, it has completed a closed-loop capability chain from optical module packaging to optical chip design and manufacturing. Looking at its financial trajectory, from 2023 to 2025, LIGENT's revenue grew from RMB 4.239 billion to RMB 8.355 billion, achieving a three-year compound growth rate of 40.4%. However, beneath this glow lies significant volatility in profitability: net profit fell from RMB 216 million in 2023 to RMB 89 million in 2024, before rebounding to RMB 873 million in 2025. Notably, the 2025 net profit of RMB 873 million includes a one-time gain of RMB 353 million from the disposal of a joint venture. The company's gross margin has also been affected by earnings fluctuations, declining from 20.6% in 2023 to 17.4% in 2024, recovering to 20.0% in 2025, and further rising to 24.2% in the first half of 2026 — this V-shaped curve is driven by an increased proportion of high-margin data center optical modules and greater contribution from overseas market revenue.

From a business structure perspective, LIGENT's growth engine has shifted. Data center optical module revenue surged from RMB 1.056 billion in 2023 to RMB 2.776 billion in 2024 and RMB 5.469 billion in 2025, with its share of total revenue climbing from 24.9% to 65.5%. In the first half of 2026, this proportion further rose to 69.4%, with revenue reaching RMB 3.745 billion, a year-on-year increase of 36.6%. Behind this curve lies the intense demand for high-speed optical modules driven by AI training and inference. The company has begun mass production of 800G optical modules and delivered 1.6T products. LPO optical modules are already in mass production, while NPO and CPO technologies are under development, and 3.2T products are in progress, keeping pace with the global first tier in terms of product iteration speed. Meanwhile, its original core business is receding into a supporting role. FTTx telecom optical module revenue contracted from RMB 1.108 billion in 2023 to RMB 602 million in 2025, with its share falling from 26.1% to 7.2%. Optical network terminal revenue share also declined from 32.8% to 21.4%. With one segment advancing and another retreating, the company has effectively completed a transformation from a "telecom access equipment provider" to an "AI computing power supplier."

In the context of the industry landscape, this shift is necessary. On the data center optical module track, Zhongji Innolight and Eoptolink firmly hold the top two positions globally, with TFC Communication and Accelink Technologies following closely behind. LIGENT's 4.0% global share means it must carve out market share through rapid product iteration and cost efficiency in the cracks between industry giants, significantly increasing its dependence on the AI capex cycle. Additionally, the optical chip segment frequently highlighted by the company represents its most imaginative business. As the highest technical barrier link in the optical module industry chain, optical chips are regarded as LIGENT's core strategic asset. However, when translated to financial statements, this segment has been loss-making over the past few years: external sales revenue shrank from RMB 112 million in 2023 to RMB 29 million in 2025, accounting for only 0.3%. The turning point emerged in 2026, as 75mW CW-DFB chips shifted from internal use to large-scale external sales, with optical chip revenue rebounding to RMB 85 million in the first half of the year, and gross margin turning significantly positive. Nevertheless, the current external market sales contribution from the optical chip segment remains limited. Against overseas leading chip manufacturers, there is still dependence on external procurement for high-end EML and other chip products, and large-scale commercialization of self-developed high-end chips still requires time.

Standing in the Spotlight, Yet Far from Trouble-Free

If GPUs are the heart of AI computing power, optical modules are the blood vessels that transport blood throughout the body. At present, the demand for these "blood vessels" is expanding at a pace exceeding everyone's expectations at the start of the year. Optical modules, components hidden inside server cabinets, are becoming the most certain "picks and shovels" sellers of the AI era. Recently, Goldman Sachs published an industry report on optical modules, raising global shipment forecasts across the board for 2026 to 2028. The upward revisions are quite striking: overall shipment forecasts were raised by 21%, 31% and 31%; 800G and above products by 31%, 39% and 36%; and 1.6T and above products by 29%, 61% and 50%. Goldman Sachs expects the global optical module market to reach $68 billion in 2026, $131 billion in 2027, and $148 billion in 2028. The 800G and above segment is projected to expand at a compound annual growth rate of 69%, growing from $45 billion this year to $130 billion by 2028. In terms of shipments, 45 million units of 800G products are expected to ship in 2026, along with 33 million units of 1.6T. By 2027, 1.6T shipments are expected to double to 71 million units, while 3.2T products will ramp up to 23 million and 68 million units in 2027 and 2028, respectively.

However, behind the high prosperity, competition in the industry is intensifying. Participants in the high-speed optical module track continue to expand production capacity, product prices are gradually declining as technology matures, and multiple technical paths — LPO, NPO, CPO, XPO — are developing in parallel, creating uncertainty in technology route selection. As such, two key details warrant careful consideration regarding LIGENT's future. On one hand, the company's R&D expense ratio has declined from 13.1% in 2023 to 7.9% in 2025, and to just 5.9% in the first half of 2026. In an industry where optical module technology iterates rapidly on an 18-to-24-month cycle, R&D intensity clearly has a positive correlation with the "technology leadership" iteration advantage in the arms race toward 3.2T and even CPO, and this deserves close attention. Additionally, the company's customer concentration continues to climb: the top five customers' revenue share rose from 55.8% in 2023 to 70.2% in 2025, reaching 71.8% in the first half of 2026. Orders from major customers have supported rapid revenue growth, but they also tie bargaining power and risk exposure to fluctuations from individual customers. Furthermore, LIGENT's customers and suppliers overlap significantly. Controlling shareholder Hisense Group itself is both an important supplier and a customer, and in some years, revenue from "supplier-customers" accounted for nearly half of total revenue. The company's ability to "stand independently" therefore also requires time to be verified.

Overall, this optical communications manufacturer is one of the few targets in the current track covering the entire industry chain. Its growth is highly correlated with the prosperity of AI computing power. While it possesses technical barriers and production capacity advantages, it also faces multiple challenges including industry cycles and technology iteration. Its long-term value will ultimately depend on the efficiency of technology commercialization, the depth of customer expansion, and its capability to manage risks.