[IPO Watch] Breakthrough in AI Cooling! Luxshare Precision (02475.HK) Surges 5% in Late Trading

On July 24, Luxshare Precision<$LUXSHARE ICT (02475.HK)$> The stock surged sharply in the final trading session, closing at HK$62, up 5%, with a single-day trading volume of approximately HK$319 million and a market capitalization of HK$477.5 billion.

Notably, today on the A-share market, Luxshare Precision <$Luxshare Precision Industry (002475.SZ)$> closed slightly down by 0.98%, showing a clear divergence between its A- and H-share price movements, as Hong Kong investors reacted more swiftly to the catalyst news.

On the news front, on July 23, Luxshare Precision officially confirmed for the first time on an investor interaction platform its in-house development project for diamond-copper thermal interface materials. The company’s secretary stated that diamond-copper, as a cutting-edge proprietary project, offers superior thermal conductivity compared to conventional copper and matches silicon in terms of coefficient of thermal expansion. This marks Luxshare Precision’s first public disclosure of progress in diamond-copper development, signaling its formal entry into the high-end thermal management materials segment.

According to Dongwu Securities, AI computing power is creating incremental demand for diamond-based cooling solutions: AI chips’ significantly higher power consumption and localized heat flux density have exposed limitations in traditional copper and aluminum heat dissipation. Diamond exhibits thermal conductivity five times that of copper and eight times that of aluminum, with a thermal expansion coefficient closely matching silicon—making it ideal for high-end chip cooling. Diamond-based thermal solutions are being implemented layer by layer from the outside in—starting with cold plates, lid covers, chip backsides, and substrates. In the near term, diamond-copper or diamond-aluminum composite materials may achieve early large-scale adoption, while in the medium to long term, CVD (chemical vapor deposition) heat spreaders are expected to penetrate the high-end computing market.

Currently, few domestic companies are active in this field. Luxshare Precision, leveraging its deep expertise in precision manufacturing, possesses dual advantages in both material R&D and scalable mass production.

Beyond the diamond-copper catalyst, multiple positive factors collectively supported the stock’s performance. On July 22, the company announced it had cumulatively spent approximately RMB 1 billion to repurchase 17.6654 million A-shares for use in equity incentive plans and employee stock ownership programs—a move that clearly signals management’s confidence in the company’s intrinsic value.

Additionally, Luxshare Precision’s H-share free float is relatively small, and a significant portion of cornerstone shares remains under lock-up, resulting in limited tradable shares in the market. Consequently, even modest inflows of capital can quickly drive up the share price—a liquidity factor that may also explain the recent H-share strength and its divergence from A-share performance.

As a global leader in precision manufacturing, Luxshare Precision is rapidly expanding its business scope beyond traditional consumer electronics into high-end segments such as AI hardware and automotive electronics. In AI hardware, the company’s high-end optical modules are already being supplied in volume to leading global AI cloud service providers, and its high-speed copper cable products have secured qualifications to supply top-tier global AI servers. These AI hardware businesses carry higher gross margins than traditional smartphone assembly operations and are steadily enhancing the company’s overall profitability structure.

Luxshare Precision listed on the main board of the Hong Kong Stock Exchange on July 9, achieving dual A+H share listings. The Hong Kong listing not only opens access to international capital markets but also provides financial backing for the company’s global strategic ambitions.

Overall, Luxshare Precision’s strong rally in today’s closing session reflects a confluence of catalysts: the breakthrough in diamond-copper thermal interface material technology and a broader revaluation of AI hardware assets. As a leading consumer electronics manufacturer expanding into AI computing hardware, every new technological initiative by the company captures significant market attention. The diamond-copper project remains in the R&D phase, and its mass production timeline and commercial contribution will require further validation over time. In the near term, it primarily serves as a thematic catalyst; however, over the medium to long term, this advanced thermal management material exhibits strong synergy with the company’s existing AI hardware business and could emerge as another key growth driver.

The 13th edition of the Top 100 Greater China Stocks Awards is about to kick off. As a dual-listed (A+H share) leader in precision manufacturing, Luxshare Precision ranks among the industry’s top tier in terms of revenue scale, market position, and technological capabilities, making it a core holding in the Hong Kong-listed technology manufacturing sector. It will be worth watching closely whether the company can leverage the rapid scaling of its AI hardware business to secure a high ranking on this year’s Top 100 list.

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