Dawning Information Industry Co., Ltd. (603019)

Equity Research Report | Industry: Domestic Computing Infrastructure/AI Servers and Liquid-Cooled Data Centers | Report Date: September 13, 2026 | As of the September 11, 2026 Close; MACD and RSI(14) Data as of September 10, 2026, Shareholder Structure Data as of June 30, 2026

This report was automatically compiled and generated by AI based on publicly available information. It is for reference only and does not constitute investment advice.

1. Executive Summary

Dawning Information Industry reported operating revenue of RMB 7.466 billion in the first half of 2026, up 27.62% year on year; net profit attributable to the parent of RMB 971 million, up 33.31%; and non-GAAP net profit attributable to the parent of RMB 844 million, up 48.45%. Revenue and profit maintained relatively rapid growth. The company’s core businesses remain high-end computers, servers, storage and computing infrastructure, while revenue from enterprise customers has risen to 61.6%. However, computing services and cloud operations remain relatively small, with hardware equipment still the primary source of revenue.

The company has business exposure to domestic computing-system integration, supernodes and superclusters, liquid-cooled data centers and distributed storage, and holds a 27.96% stake in Hygon Information. In 2025, investment income from Hygon under the equity method was approximately RMB 680 million, accounting for around 30% of the company’s net profit attributable to the parent. In the first half of 2026, investment income reached RMB 453 million, up 40.58% year on year. Accordingly, profit growth was driven both by improvement in the core business and by the earnings and share-price performance of the associate.

In terms of earnings structure, revenue from software development, system integration and technical services reached RMB 2.446 billion in 2025, up 75.34% year on year, with a gross margin of 47.25%. In the first half of 2026, the gross margin of software and services rose further to 49.26%. However, the ramp-up of supernodes and servers lifted the hardware revenue proportion back to 89.3%, while the gross margin of IT equipment declined to 24.60%; overall gross margin was 27.2%. Meanwhile, R&D investment reached RMB 1.094 billion in the first half of 2026, up 78.36% year on year, and period-end inventories increased to RMB 6.792 billion, up 92.24% from the beginning of the year.

As of September 11, 2026, the company’s share price was RMB 82.25, down approximately 6.8% from August 31, below the MA5, MA10 and MA20. MACD remained below the zero axis, indicating continued technical weakness. The lower Bollinger Band and recent lows correspond to the RMB 79.9–81.1 area. Based on 2026 consensus EPS, the forward P/E was approximately 40x. The conversion price of the RMB 8.0 billion “Shu 26 Convertible Bonds,” issued by the company in 2026, is currently RMB 108.89. Future conversion or adjustments to the conversion price could affect the share count and valuation basis.

2. Company Overview

2.1 Basic Information

2.2 Core Businesses and Product Portfolio

• High-end computers (general-purpose servers/high-performance computers/supernodes/superclusters, the core business)
• Storage (distributed and centralized all-flash storage)
• Data centers and liquid-cooling solutions (through subsidiary Sugon Data)
• Advanced computing-center construction and computing services (computing operations)
• Cloud computing (Sugon Cloud, government and city clouds)
• Cybersecurity
• Software development, system integration and technical services (the FY2025 annual-report revenue disclosure category, covering data centers, cloud computing and customized development services, among others)

2.3 Position in the Industry Chain and Cost-Profit Structure

Dawning Information is a domestic-computing and high-end-computer company listed on the main board of the Shanghai Stock Exchange. The company positions itself as a provider of “computing infrastructure/domestic full-stack computing,” building a chain covering “core components—infrastructure—platform services.” Its principal businesses include the R&D and manufacturing of high-end computers, storage, security and data-center products, extending into cloud computing, intelligent computing (AI computing), green-computing liquid cooling, computing-center construction and operations, and computing services. FY2025 revenue was RMB 14.964 billion (+13.8%) and net profit attributable to the parent was RMB 2.176 billion (+13.9%). IT equipment, including high-end computers, storage and other hardware, generated RMB 12.503 billion, accounting for 83.6%, with a gross margin of 27.31%. Software development, system integration and technical services generated RMB 2.446 billion, accounting for 16.4%, up 75.34% year on year, with a gross margin of 47.25%. The company held 27.96% of Hygon Information (688041.SH) and was its largest shareholder. The proposed share-swap merger by absorption of Dawning Information by Hygon Information, initiated in June 2025, was terminated on 2025-12-09. It should be noted that some figures below, including the concentration of the top five customers and suppliers, are sourced from Tonghuashun F10 or secondary media compilations of annual-report data and could not be individually reconciled with the original annual report in this review. They should be checked against the original annual report before use. Financial data are current through the 2026 interim report.

• Actual procurement content: CPUs are primarily supplied by Hygon’s domestic x86 CPUs after supplies from U.S. companies such as Intel and AMD were cut off following inclusion on the Entity List in 2019. AI accelerator cards are compatible with multiple domestic brands, including Hygon DCUs and Huawei Ascend cards (scaleX640 is compatible with multiple brands of AI accelerator cards). Other components include memory/DRAM, flash and mechanical hard drives, PCBs/boards, power supplies, structural components, high-speed networking chips/optical modules and liquid-cooling components. Self-developed scaleFabric supplements 400G networking chips/optical modules, while liquid-cooling components are self-developed by subsidiary Sugon Data.
• Supplier concentration: In FY2025, the top five suppliers accounted for total purchases of RMB 1.886 billion, or 19.19% of total procurement. Purchases from the largest supplier were RMB 395 million, or 4.01% (source: secondary compilation of the 2025 annual report by Chagu.com/Tonghuashun F10; not directly reconciled with the original annual report and should be verified). In a historical year, the top five suppliers reportedly accounted for 43% (data from Lixinger; the corresponding year could not be fully verified).
• Bargaining position: After inclusion on the Entity List, chip procurement shifted from “high dependence on a single U.S. source” to a more diversified model based on Hygon and multiple domestic chip suppliers. However, core chips—whether from Hygon or Huawei—remain close to monopoly supplies within their respective ecosystems. The company has limited bargaining power over key chips and is effectively a price taker; for non-chip components such as PCBs, structural parts and power supplies, suppliers are more diversified and the company has some room to negotiate prices.
• Related-party/binding relationships: Hygon is both a 27.96%-owned associate, a core CPU supplier and a major customer. Media estimates indicate that related-party transactions between the two companies reached the tens of billions of yuan in 2025, with approximately 60% of Hygon’s revenue reportedly coming from Dawning and its related parties. This is a media-calculated figure and should be verified against the related-party transaction sections of both companies’ annual reports.
• Buyer structure: Revenue from government, research institutes, supercomputing and intelligent-computing centers and other “public-sector” customers was RMB 7.713 billion in FY2025, accounting for 51.6%, with a gross margin of 35.06%. Enterprise customers contributed RMB 7.237 billion, accounting for 48.4%, with a gross margin of 25.79%. The mix shifted toward enterprises in 2026H1: enterprise revenue was RMB 4.601 billion, or 61.6%, while public-sector revenue was RMB 2.858 billion, or 38.3%.
• Downstream exposure is almost entirely domestic: overseas revenue in FY2025 was only RMB 3.24 million, or 0.02%. Sales are primarily direct, with direct sales accounting for 95.4% in FY2025. Customer cases include procurement by telecom operators and central and local state-owned enterprises. In 2026, the company won the largest share in China Mobile’s distributed block-storage procurement, worth approximately RMB 180 million, and won all five lots in CRRC’s storage procurement.
• Industry negotiation mechanism: Customers are primarily government and enterprise clients and telecom operators procuring through tenders and centralized purchasing. Negotiations focus on tender price reductions, domestic-content qualification thresholds and the acceptance schedule for large projects. There are no “annual price reduction” clauses of the type common in automotive components. Evidence of downstream demand strength includes contract liabilities of RMB 1.279 billion at the end of FY2025, up 34.58% year on year (Galaxy Securities commentary, 2026-04-16), indicating growth in advance payments for orders on hand.
• Working-capital evidence (calculated in a research memo based on data disclosed on Sina’s financial-report pages, for reference): Accounts receivable at the end of 2025 were RMB 2.755 billion, equivalent to approximately 126.6% of net profit attributable to the parent (Securities Star’s annual-report analysis also highlighted this ratio) and approximately 18.4% of revenue; receivables turnover was approximately 60–70 days. At the end of 2026H1, accounts receivable declined to RMB 2.11 billion, while inventories increased from approximately RMB 3.53 billion at the end of 2025 to RMB 6.79 billion, nearly doubling, primarily due to stocking of AI servers and supernodes for orders on hand. Notes payable and accounts payable totaled RMB 4.61 billion at the end of 2025, materially above accounts receivable of RMB 2.755 billion (total receivables including notes receivable were approximately RMB 2.85 billion), indicating some ability to obtain payment terms from upstream small and medium-sized suppliers. In addition, long-term payables/special payables under non-current liabilities were RMB 8.38 billion at the end of 2025 and RMB 8.90 billion at the end of 2026H1 (Sina financial-report pages). This may be related to government special-fund arrangements for the joint construction and operation of computing centers—an informed inference in the research memo; the specific composition should be determined from the annual-report notes. Overall, the capital-occupation structure reflects “slower downstream collections, upstream financing through payment terms, and inventory stocking to fulfill orders.” The company’s bargaining position in the industry chain is moderately strong rather than that of a pure contract manufacturer squeezed by both upstream and downstream parties.
• Concentration (important and requiring verification): ① Customer side—sales to the top five customers in FY2025 totaled RMB 12.353 billion, or 82.56% of operating revenue; the largest customer accounted for RMB 2.897 billion, or 19.36%. These figures are from a secondary compilation of the 2025 annual report by Chagu.com (Tonghuashun F10) and could not be checked word-for-word against the original annual-report pages. Media outlet NetEase Finance reported that the top five customers accounted for 87.95% in FY2024 and the largest customer accounted for 66.31%; this was based on a single media source and could not be cross-verified. The identity of the largest customer has not been disclosed by the company. ② Supplier side—purchases from the top five suppliers in FY2025 totaled RMB 1.886 billion, or 19.19% of total procurement, while the largest supplier accounted for 4.01%. These figures also came from a secondary compilation by Tonghuashun F10 and could not be directly checked against the original annual report. Industry concentration is affected by large project-based orders and fluctuates significantly from year to year; the latest annual report should be checked before citation.

Dawning Information occupies a position on the vertically integrated domestic-computing platform portion of the smile curve: midstream complete-machine manufacturing remains the main revenue source, the company is extending downstream into computing operations and high-margin software services, and it shares in upstream chip profits through its 27.96% stake in Hygon. Hardware-manufacturing gross margin is approximately 24.6%–27.3%, materially above the single-digit gross margins of general-purpose server manufacturers such as Inspur Information, but the company remains a price taker. Overall gross margin is lifted to 27%–31% by software and services (47.25%→49.26%) and product mix. Notably, approximately 30% of the company’s FY2025 net margin attributable to the parent of around 14.5% came from Hygon investment income (approximately RMB 680 million/RMB 2.176 billion). The non-GAAP net margin of approximately 12.3% is closer to the underlying profitability of the core business. Further margin improvement will be driven by a higher proportion of high-end supernodes and 100,000-card clusters, increased contributions from computing operations and software services (liquid cooling as a service/computing as a service), and higher Hygon chip volumes, rather than expansion in general-purpose server volumes.

3. Financial Data and Valuation Analysis

3.1 Recent Operating Performance

The 2025 annual report was disclosed on April 15, 2026; 2026 first-quarter data were relayed by brokerage research; the 2026 interim report was disclosed on August 26, 2026. Non-GAAP net profit attributable to the parent in 2026H1 was RMB 844 million, up 48.45% year on year; 2025 non-GAAP net profit attributable to the parent was RMB 1.838 billion, up 33.97%. No 2026 third-quarter report or full-year earnings forecast had been disclosed.

FY2025 overall gross margin was 30.58%, up 1.42 percentage points year on year. R&D investment in 2026H1 was RMB 1.094 billion, up 78.36% year on year and equivalent to 14.65% of revenue. Period-end inventories were RMB 6.792 billion, up 92.24% from the beginning of the year. Investment income in 2026H1 was RMB 453 million, up 40.58% year on year, primarily from Hygon Information, in which the company holds 27.96%. Excluding this investment income, the core business made a relatively small contribution to earnings. The company announced in April 2026 that it had no controlling shareholder or actual controller.

3.2 Earnings Forecast

Consensus data are from the Tonghuashun F10 earnings-forecast page as of 2026-09-06, based on forecasts from 22, 22 and 20 institutions for the respective years. The 2026E net profit attributable to the parent range is RMB 2.570–3.947 billion, the 2027E range is RMB 3.115–5.652 billion, and the 2028E range is RMB 4.021–8.028 billion. Consensus does not provide revenue forecasts. Among individual brokers, Guotai Haitong forecasts 2026/2027/2028 revenue of RMB 17.574/20.672/24.471 billion and net profit attributable to the parent of RMB 2.877/3.595/4.389 billion. Huachuang Securities, Guosheng Securities, Guolian Minsheng and Western Securities, among others, have also issued earnings forecasts, but their methodologies differ from consensus and some are notably optimistic; the distinction should be noted.

3.3 Valuation and Institutional Ratings

As of the September 4, 2026 close, Dawning Information’s share price was RMB 82.69, with a total market capitalization of approximately RMB 120.985 billion and total shares of 1.463 billion. Static P/E was approximately 55.6x and trailing P/E approximately 49.8–50.0x. Based on 2026E consensus EPS of RMB 2.05, forward P/E was approximately 40.3x; based on 2027E EPS of RMB 2.61, it was approximately 31.7x. Price-to-book was approximately 5.25x and dividend yield approximately 0.5%. According to Tonghuashun, the target-price range from 16 institutions over the past six months was RMB 98.00–123.88, with an average of approximately RMB 105.43. It should be specifically noted that the proposed share-swap merger by absorption with Hygon Information was terminated on December 10, 2025, and no restart had been observed as of September 6, 2026. The current valuation is based on the company as an independent listed entity and on equity-method accounting for its 27.96% Hygon investment income. Some old research reports have been reposted online with an incorrectly labeled date of June 10, 2026. In addition, the RMB 8.0 billion “Shu 26 Convertible Bonds” began trading on August 6, 2026, with an initial conversion price of RMB 108.89 per share, materially above the current share price. Current broker earnings forecasts generally do not include conversion dilution; if a downward adjustment or conversion occurs in the future, the share count and valuation basis may change.

4. Recent News and Announcements

4.1 2026 Interim Report: Revenue and Profit Maintained Rapid Growth

Dawning Information disclosed its 2026 interim report on August 26, 2026. Revenue in the first half of 2026 was RMB 7.466 billion, up 27.62% year on year; net profit attributable to shareholders of the listed company was RMB 971 million, up 33.31%; and net profit attributable to the parent after deducting non-recurring items was approximately RMB 844 million, up 48.45%. The company stated that earnings growth was primarily attributable to improved profitability in the core business driven by product-mix optimization. No profit-distribution or capital-reserve-to-share-capital proposal was made during the reporting period. The interim report was unaudited. As of September 13, 2026, no new earnings forecast, earnings pre-increase or earnings pre-decrease announcement for the third quarter or full year of 2026 had been identified.

4.2 Proposed Repurchase and Cancellation of 61,440 Restricted Shares and Adjustment of the Repurchase Price

On August 26, 2026, the company disclosed a proposal to repurchase and cancel 61,440 restricted shares under its 2021 restricted share incentive plan that did not meet the conditions for lifting restrictions, representing approximately 0.004% of total shares before implementation. Reasons include the departure of certain incentive recipients and certain recipients’ failure to meet the standards for fully lifting restrictions under individual performance assessments. The repurchase price for restricted shares granted in the initial offering would be adjusted from RMB 14.51 per share to RMB 13.16, while the price for shares granted in the reserved tranche would be adjusted from RMB 13.45 to RMB 12.26. Funding would come from the company’s own funds. The matter remains subject to shareholder approval. The company stated that it is not expected to have a material impact on its financial position or operating results.

4.3 Proposed Cancellation of 784,041 Unused Shares in the Special Repurchase Securities Account

On August 26, 2026, the company disclosed a proposal to change the purpose of 784,041 shares repurchased under the 2023 repurchase plan but not yet used for an employee share-ownership plan or equity incentive plan from “use for an employee share-ownership plan or equity incentive plan” to “cancellation and reduction of registered capital.” The shares were repurchased on January 3, 2024, at a cumulative highest transaction price of RMB 38.73 per share and lowest transaction price of RMB 37.27, with cumulative funds paid of RMB 29,996,466.63, excluding stamp duty, trading commissions and other transaction costs. The company stated that as the three-year period following disclosure of the repurchase announcement is about to expire, the unused repurchased shares must undergo the statutory cancellation procedure. The matter remains subject to shareholder approval, and the final change in share capital will be based on the capital-structure statement issued by the Shanghai branch of China Securities Depository and Clearing Corporation Limited.

4.4 2026 Second Extraordinary Shareholders’ Meeting to Review Share Cancellation and Related-Party Transactions

The company plans to hold its second extraordinary shareholders’ meeting of 2026 at 14:00 on September 16, 2026, using a combination of on-site and online voting. As of September 13, the meeting had not yet been held. Matters to be reviewed include supplemental estimates for 2026 recurring related-party transactions; repurchase and cancellation of restricted shares under the 2021 restricted share incentive plan and adjustment of the repurchase price; cancellation of shares in the special repurchase securities account; amendments to the Articles of Association; and amendments to the Measures for the Administration of Proceeds Raised. Accordingly, the repurchase cancellation, share cancellation and registered-capital change cannot yet be considered complete and require the shareholder resolution and subsequent cancellation-registration announcement.

4.5 Supplemental Estimates for 2026 Recurring Related-Party Transactions Await Shareholder Approval

On August 26, 2026, the company disclosed the Announcement on Supplemental Estimates for 2026 Recurring Related-Party Transactions. The company stated that because actual demand from related parties had increased relative to the initial estimate at the beginning of the year, the finance department had calculated the need to supplement the estimated 2026 quota for recurring related-party transactions. The proposal was approved by the board, with related director Li Jun abstaining. The vote among non-related directors was six in favor, zero against and zero abstentions. The Audit Committee and the special meeting of independent directors also approved the matter, but it remains subject to shareholder approval. The company stated that the transactions primarily support normal production and operating activities, follow fair and reasonable pricing principles, do not affect the company’s independence and will not create significant dependence on related parties. Certain basic information and related relationships of related parties were exempted from disclosure under applicable law in the public documents; subsequent announcements should be monitored for implementation details.

4.6 Interim Earnings Presentation Addresses Domestic Computing Clusters, Liquid Cooling and Commercialization

The company held its interim earnings presentation on September 3, 2026. It stated that it has technological and ecosystem advantages in delivering domestic clusters at the 10,000-card and even 100,000-card levels, with accumulated capabilities in high-speed interconnection networks, tightly coupled computing, storage and transmission, high-density power supply and heat dissipation, and unified resource scheduling. The computing-services platform currently accounts for a low proportion of revenue, while computing equipment such as high-end computers remains the core business and cloud operations and related services account for a relatively small share. The company stated that subsidiary Sugon Data has ranked first in China’s computing-center infrastructure temperature-control equipment market for five consecutive years and that, as of the first half of 2026, it had undertaken overseas liquid-cooling projects totaling more than 600 MW. Products released since 2026, including supernodes, high-speed networking, high-end storage and high-performance computing platforms, have gradually entered commercial delivery, although some products may still require time to progress from commercial delivery to large-scale industrialization. These statements primarily reflect the company’s own disclosures and investor Q&A; they do not constitute announcements of new orders or earnings commitments. No fully independent third-party cross-verification was found for the relevant market shares, overseas project scale or commercialization progress.

4.7 No Downward Adjustment to the Conversion Price of the “Shu 26 Convertible Bonds” This Time

On August 13, 2026, the company announced that its share price had triggered the conditions for a downward adjustment of the conversion price of the “Shu 26 Convertible Bonds,” but the board decided not to make a downward adjustment this time. The company also stated that if the conditions were triggered again between August 14 and November 13, 2026, it would not make a further downward adjustment. This may affect expectations for bond conversion and the pace of share dilution.

4.8 No New Announcements of Voluntary Purchases by Major Shareholders Identified Recently

As of September 13, 2026, no new announcement of an additional share-purchase plan by the company’s controlling shareholder or major shareholders had been identified. Recent shareholder developments primarily included the early termination of a disposal plan and disclosure of disposal results by director and general manager Li Jun and certain senior executives in June 2026, as well as changes in share-pledge data in September. The June 2026 disposal was not a new development in September 2026.

4.9 Share-Pledge Ratio Increased Slightly from September 4

Data from Eastmoney’s shareholder and equity calendar show that approximately 27.093 million shares were pledged as of September 4, 2026, representing a pledge ratio of approximately 1.85%. As of September 11, approximately 27.543 million shares were pledged, representing approximately 1.88%. These data come from a third-party equity-calendar platform. No corresponding individual pledge announcements were found for complete verification; the company’s formal announcements and China Securities Depository and Clearing data should prevail.

4.10 No New Regulatory Penalties, Inquiries or Major M&A Announcements Identified as of September 13

As of September 13, 2026, this review found no announcement that the company had received an administrative penalty from the China Securities Regulatory Commission, disciplinary action from the Shanghai Stock Exchange, regulatory warning or inquiry letter in September 2026. No new major asset restructuring, share issuance for asset purchases or major M&A announcement in September 2026 was identified. The company’s 2026 interim report stated that in April 2026 it acquired, with its own funds, the 20% stake held by minority shareholders in Tianjin Dawning Information Storage Technology Co., Ltd., increasing its ownership from 70% to 100% after completion. This was not a new September announcement.

4.11 Issuance and Fundraising Projects for the “Shu 26 Convertible Bonds” Form the Recent Capital-Operations Background

The company issued the “Shu 26 Convertible Bonds” in 2026, with an issuance size of RMB 8.0 billion. The issuance was completed in July 2026, and the bonds began trading on the Shanghai Stock Exchange on August 6, 2026. In late August, the company also disclosed matters including replacement of funds raised, adjustment of the implementation entity for fundraising projects and amendments to the proceeds-management measures. These matters were not major new announcements in September, but relate to future capital expenditures, construction of fundraising projects and potential share dilution. The use of proceeds and conversion status of the bonds should continue to be monitored.

4.12 Overall Assessment of Recent News and Key Uncertainties

As of September 13, 2026, the main themes of the company’s recent announcements were: continued rapid growth in first-half revenue and net profit attributable to the parent; proposed repurchase and cancellation of 61,440 restricted shares and cancellation of 784,041 previously repurchased but unused shares, involving a total of 845,481 shares, subject to shareholder approval; proposed supplemental estimates for 2026 recurring related-party transaction quotas; and continued reinforcement at the earnings presentation of the company’s market positioning in domestic computing clusters, liquid cooling and full-stack intelligent-computing products. It should be noted that the extraordinary shareholders’ meeting scheduled for September 16 had not yet been held and share cancellation had not been completed. Statements at the earnings presentation regarding cluster-delivery capabilities, liquid-cooling market share and overseas project scale primarily came from the company. Share-pledge data came from a third-party platform. The 2026 interim report was unaudited, and future business assessments, product commercialization schedules and descriptions of industry demand do not constitute earnings commitments by the company.

5. Share-Price Performance and Technical Analysis

5.1 Price Overview

5.2 Technical Indicators

As of September 11, 2026, the share price closed at RMB 82.25, down approximately 6.8% from the August 31 close of RMB 88.27, and remained in weak, low-level consolidation. The price was below the MA5, MA10 and MA20; MACD was below the zero axis; and RSI(14) was approximately 40.78. The technical picture remained weak but had not entered the traditional oversold zone. The Bollinger Bands placed the price below the middle band at RMB 84.80 and above the lower band at RMB 79.92, making RMB 79.9–81.1 a short-term support area to watch. In terms of fund flows, extra-large and large orders recorded consecutive net outflows from September 3 to September 9. Trading value declined after the high-volume drop on September 4, and no clear high-volume strengthening signal had emerged.

5.3 Short-Term Outlook (Next Week, Scenario Analysis for Reference Only)

⚠️ Risk Warning: The following is a subjective scenario analysis based on closing data as of September 11, 2026 and related historical data. It does not constitute investment advice or a definitive forecast of future prices.

① Key Technical Levels

② Scenarios for the Coming Week (Subjective Weights, Not Statistical Probabilities)

• Range-bound consolidation (relatively high subjective heuristic weight, approximately 60%; not a statistical probability): Watch range of approximately RMB 80.7–85.0. Conditions include the share price holding near RMB 80.7, trading value remaining in the recent normal range of approximately RMB 1.0–1.8 billion, and no significant new negative news. Although the price is below MA10 and MA20, it has not broken below the lower Bollinger Band or the 52-week low and may consolidate weakly around RMB 82.
• Weak decline (medium subjective heuristic weight, approximately 20%–30%; not a statistical probability): Watch range of approximately RMB 76.8–80.7. Conditions include a decisive close below RMB 80.7, daily trading value expanding to above RMB 2.0 billion without the price recovering, and continued net outflows from extra-large and large orders. The next area to watch would be from the lower Bollinger Band at approximately RMB 79.9 to the 52-week low of RMB 76.78.
• Strengthening rebound (relatively low subjective heuristic weight, approximately 10%–20%; not a statistical probability): Watch range of approximately RMB 84.8–89.7. Conditions include the share price moving back above RMB 84.0–84.8, trading value expanding for several consecutive sessions to above RMB 2.0 billion, turnover reaching approximately 1.7%–2.0% or higher, and simultaneous strength in related sectors such as computers and computing. Without volume support, the durability of any breakout would require further observation.

③ Fund-Flow and Liquidity Background

As of September 11, 2026, the average turnover rate over the previous five trading days was approximately 1.2%, with a range of 0.88%–1.48% from September 7 to September 11. Recent trading value was generally RMB 1.0–1.8 billion, although it increased to approximately RMB 2.81 billion on September 4. In terms of shareholder structure, as of June 30, 2026, the number of shareholders was approximately 405,000. The top 10 tradable shareholders collectively held approximately 25%–26%, while institutional holdings represented approximately 26% of the tradable shares, including approximately 7.26% held by funds and approximately 18.51% held by other institutions. Major shareholders included company-related management personnel, asset-management companies and local state-owned enterprises. The E Fund CSI Artificial Intelligence Theme ETF was a new entrant among the top 10 tradable shareholders according to the 2026 first-quarter report. The shareholder data are subject to differences in page-level statistical methodologies and are more than two months removed from September 11, 2026; the actual ownership structure may have changed. Institutional and fund holdings also do not necessarily indicate concentrated locked-up positions by active institutions. Given the company’s large market capitalization and daily trading value generally above RMB 1.0 billion, extreme illiquidity is not normally an issue. However, if trading value falls below approximately RMB 1.0 billion, price sensitivity to market sentiment and large-order trading may increase. The sustainability of a rebound without support from trading value and turnover should be monitored.

Volume confirmation signals to monitor: if daily trading value subsequently remains above RMB 2.0 billion for consecutive sessions, turnover stays at approximately 1.7%–2.0% or higher, and the share price simultaneously holds above RMB 84.8, this could be viewed as a signal of improved fund participation. If trading value expands while the share price continues to fall below RMB 80.7, this would be more consistent with high-volume distribution or risk release.

④ Points to Watch (Observation Framework Only, Not Trading Instructions)

• Observation framework, not a trading instruction: Monitor whether the RMB 82.0–80.7 area attracts support, particularly whether the recent low of RMB 80.68 is decisively breached.
• Observation framework, not a trading instruction: Monitor whether RMB 84.0–84.8 can be regained and held. This area corresponds to MA10 and MA20 and is the first confirmation zone for short-term structural repair.
• Observation framework, not a trading instruction: If RMB 84.8 is broken, continue to monitor volume and selling pressure around RMB 85.4 and RMB 88.3–89.7; a trend reversal should not be inferred solely from a one-day rise.
• Observation framework, not a trading instruction: Monitor whether trading value can expand above RMB 2.0 billion for consecutive sessions and improve together with turnover above approximately 1.7%–2.0%.

The above scenario analysis is based on the September 11, 2026 closing data and historical price and technical-indicator calculations. Short-term share prices will also be affected by news, fund flows, broader market conditions and other factors. Technical indicators have inherent lags and limitations. This does not guarantee actual future performance or constitute a buy or sell recommendation. Investors should make independent judgments based on the latest market information and bear investment risks themselves.

6. Industry Landscape and Competitor Analysis

6.1 Industry Conditions

The company operates in domestic computing infrastructure and high-end computers, specifically AI servers, high-performance computing, liquid-cooled data centers, distributed storage and computing operations. The 2026 interim report’s operating review cited the following: China’s intelligent-computing capacity reached 2,185 EFLOPS (FP16) at the end of June 2026, up 177% year on year; China shipped approximately 4.0 million AI accelerator cards in 2025, of which domestic manufacturers accounted for 1.65 million, or 41%; beginning in January 2026, government procurement offered a 20% price-evaluation preference to domestic products; third parties estimate that the liquid-cooled data-center market will grow from RMB 23.25 billion in 2026 to RMB 47.04 billion in 2028; and China’s distributed-storage market reached RMB 28.94 billion in 2025, up 46% year on year. The sector benefits from strong policy support, high domestic-computing demand and robust growth, but competition is intense. Market-share and financial data in this section are based on the 2025 annual report, the 2026 interim report and third-party reports published before August 2026. As of the retrieval date of 2026-09-05, no 2026 third-quarter report had been found.

6.2 Competitive Landscape

• AI-server/complete-machine brand market: According to MIR Research statistics for China’s AI-server market in 2025H1, Inspur Information ranked first with approximately 32%, followed by ZTE at approximately 15%, xFusion at approximately 12.2%, H3C at approximately 12%, and Huawei at approximately 10.6%. Dawning Information was not among the top five and belonged to the “other/second tier” (source: Securities Star industry deep dive, 2026-07).
• Liquid-cooled data centers: Subsidiary Sugon Data ranked first in China for five consecutive years with a 56.8% market share (CCID Consulting, China Liquid-Cooled Data Center Market Report 2025–2026, reported in 2026-08). Its market share in AI inference scenarios exceeded 50%, and it is reportedly the only domestic company with large-scale deployment of immersion phase-change liquid cooling.
• Storage: CCID Consulting data from 2026-08 show that Sugon’s distributed storage/distributed all-flash storage ranked first by market share in four sectors—AI large models, embodied intelligence, autonomous driving and education—and that its AI storage ranked first for the third consecutive year.
• Supercomputing/domestic computing system-level delivery: On 2026-07-10, China’s first fully domestic 100,000-card AI supercluster, Sugon 8000, was completed and connected to the national supercomputing internet. The company also has projects including the first 30,000-card domestic AI computing pool and the Zhengzhou core node of the national supercomputing internet. The company and brokers describe it as part of the first tier in domestic computing-system integration/full-stack solutions.
• Competitive mechanism: Government and enterprise/telecom centralized procurement and domestic-content qualification thresholds are the main mechanisms. The industry is polarized between “high-end, high-margin” and “general-purpose, low-margin” products. Price competition is intense in general-purpose AI servers, while liquid cooling, full-stack system delivery and computing operations are becoming sources of margin differentiation.

6.3 Major Competitors

Dawning Information reported FY2025 revenue of RMB 14.964 billion and net profit attributable to the parent of RMB 2.176 billion, materially smaller than Inspur Information (FY2025 revenue of RMB 164.782 billion and net profit attributable to the parent of RMB 2.413 billion) and Foxconn Industrial Internet (FY2025 revenue of RMB 902.89 billion and net profit attributable to the parent of RMB 35.29 billion). However, its net margin attributable to the parent was approximately 14.5% (calculated in the research memo based on disclosed figures), materially above Inspur Information’s approximately 1.5%. The company’s FY2025 overall gross margin was approximately 30.6% (research-memo calculation based on revenue/operating costs), among the highest among comparable domestic-computing hardware companies (sources include peer comparisons cited by Moomoo, which also described Dawning’s 2025 gross margin of approximately 30.58% as industry-leading). Dawning’s differentiation lies not in pursuing the largest general-purpose AI-server market share, but in focusing on “domestic content + high-density liquid cooling + supercomputing/intelligent-computing system-level delivery + computing operations,” while sharing in upstream chip profits through its 27.96% Hygon stake (FY2025 investment income of approximately RMB 680 million). It competes directly with Unisplendour/H3C in enterprise networking and government/enterprise procurement and both cooperates and competes with Huawei and xFusion in domestic-computing projects.

7. Risk Factors

• Core-chip supply remains subject to bargaining and supply-constraint risks. Although the company has shifted toward domestic suppliers such as Hygon CPUs, Hygon DCUs and Huawei Ascend, key chips are concentrated within their respective ecosystems, and the company has limited bargaining power over core chips. Hygon is simultaneously an important associate, supplier and customer, so related-party transactions and supply-chain dependence require continued monitoring.
• Core-business profitability is materially dependent on Hygon investment income. Hygon investment income under the equity method was approximately RMB 680 million in 2025, accounting for around 30% of the company’s net profit attributable to the parent, and RMB 453 million in 2026H1. If Hygon’s earnings growth, operating performance or relevant market valuation changes, the company’s investment income and growth in net profit attributable to the parent may be affected.
• Rapid inventory growth may create working-capital and impairment risks. Inventories reached RMB 6.792 billion at the end of 2026H1, up 92.24% from the beginning of the year. The company attributed this mainly to stocking of AI servers and supernodes and orders on hand. If order delivery, project acceptance or customer demand falls short of expectations, inventory turnover could slow, cash flow could come under pressure and asset-impairment risks could increase.
• High customer concentration and project-acceptance schedules may affect revenue recognition. According to a secondary compilation of the 2025 annual report by Tonghuashun F10, the top five customers accounted for approximately 82.56% of revenue and the largest customer approximately 19.36%, although these figures have not been checked word-for-word against the original annual report. The company’s downstream customers are primarily governments, research institutes, telecom operators and large enterprises procuring through tenders and centralized purchasing. Delays in order delivery and acceptance could cause quarterly fluctuations in revenue and profit.
• Competition in general-purpose and AI-server markets is intense, creating downward pressure on hardware margins. The company’s IT-equipment gross margin fell to 24.60% in 2026H1, while hardware’s share of revenue rose to 89.3%. If the proportion of high-end supernodes, liquid cooling and software services does not increase as expected, product-mix improvement may not offset the impact of price competition and product-mix changes on overall margins.
• Commercialization of liquid cooling, supernodes, 100,000-card clusters and overseas projects remains uncertain. Relevant market shares, the scale of overseas liquid-cooling projects and some cluster-delivery information primarily come from the company. Some products may require time to progress from commercial delivery to large-scale industrialization, and the information does not constitute new orders or earnings commitments.
• Capital operations may lead to share dilution and changes in the valuation basis. The company has issued RMB 8.0 billion of “Shu 26 Convertible Bonds” with an initial conversion price of RMB 108.89. In August 2026, the board decided not to make a downward adjustment this time, but a future conversion-price adjustment or conversion could increase the share count and affect EPS and valuation.
• Corporate governance and related-party transactions require monitoring. The company has changed to having no controlling shareholder or actual controller. Supplemental estimates for 2026 recurring related-party transactions remain subject to shareholder approval, and certain related-party information was exempted from disclosure under applicable law. Changes in the scale, pricing or governance arrangements of related-party transactions could affect market perceptions of the company’s independence and governance stability.
• The short-term share price and fund-flow picture remain weak. As of September 11, 2026, the share price was below MA5, MA10 and MA20, MACD was below the zero axis, and extra-large and large orders recorded consecutive net outflows from September 3 to September 9. If the share price falls below approximately RMB 80.7 on rising volume, it may further test the area from approximately RMB 79.9 to the 52-week low of RMB 76.78.

8. Conclusion and Outlook

The company operates in the rapidly growing domestic-computing infrastructure and AI-server sector. Its growth drivers primarily include domestic-content procurement, AI-computing cluster construction, liquid-cooled data centers, distributed storage and expansion of high-margin software and services. In the first half of 2026, non-GAAP profit grew faster than revenue, indicating that product-mix optimization had begun to improve core-business profitability. The company already has commercial cases in domestic 10,000-card and 100,000-card clusters, liquid cooling and system-level delivery, although some products still require time to move from delivery to large-scale industrialization.

Future earnings elasticity will depend on the realization of orders for high-end supernodes and domestic-computing clusters, the increasing contribution of software services and computing operations, commercialization progress in liquid cooling and storage, and Hygon Information’s contribution to investment income. Market consensus expects average net profit attributable to the parent of RMB 2.996 billion, RMB 3.816 billion and RMB 4.821 billion in 2026–2028, respectively. However, forecast ranges are wide, and no consensus revenue data have been provided. Earnings realization should therefore be assessed alongside changes in orders, deliveries, gross margin and cash flow.

The company now has no controlling shareholder or actual controller. The proposed share-swap merger by absorption with Hygon Information has been terminated, and in the short term the company should be viewed as an independent listed entity for operating and valuation purposes. At the same time, the share-price technical structure has not strengthened and valuation remains elevated. The supplemental estimate for related-party transactions, potential dilution from the RMB 8.0 billion convertible bonds, rapid inventory growth and customer concentration could all increase fluctuations in earnings and valuation.

Data Sources

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• http://www.ddx.gubit.cn/mango/jingying/603019.html
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• https://vip.stock.finance.sina.com.cn/corp/go.php/vFD_ProfitStatement/stockid/603019/ctrl/part/displaytype/4.phtml
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• https://www.9fzt.com/detail/sh_603019_9_8401cb84e52e8d8e3c29a3c03dd6a830.html
• http://stockfinance.sina.cn/stock/go.php/paper/reportid/841891077650/index.phtml
• https://paper.cnstock.com/html/2026-04/15/content_2199892.htm
• Dawning Information (603019)_Company Announcements_Dawning Information: 2026 Interim Report_Sina Finance_Sina.com
• Dawning Information (603019)_Company Announcements_Dawning Information: Announcement on Repurchase and Cancellation of Restricted Shares under the 2021 Restricted Share Incentive Plan and Adjustment of the Repurchase Price_Sina Finance_Sina.com
• Dawning Information (603019)_Company Announcements_Dawning Information: Announcement on Cancellation of Shares in the Special Repurchase Securities Account_Sina Finance_Sina.com
• Dawning Information (603019)_Company Announcements_Dawning Information: Materials for the Second Extraordinary Shareholders’ Meeting of 2026_Sina Finance_Sina.com
• Dawning Information (603019)_Company Announcements_Dawning Information: Announcement on Supplemental Estimates for 2026 Recurring Related-Party Transactions_Sina Finance_Sina.com
• Dawning Information: Earnings Presentation Held on September 3, with Investor Participation
• Dawning Information: Announcement on Not Making a Downward Adjustment to the Conversion Price of the “Shu 26 Convertible Bonds”_Asset Restructuring_Company Announcements_Daily Must-Read_Stocks_Securities Star
• Dawning Information (603019)_Company Announcements_Dawning Information: Announcement on Early Termination of the Share-Reduction Plan by Directors and Senior Executives and Results of Share Reduction_Sina Finance_Sina.com
• Dawning Information_Individual Stock Calendar_Eastmoney Data Channel
• Dawning Information (603019)_Company Announcements_Dawning Information: 2026 Interim Report_Sina Finance_Sina.com
• Dawning Information (603019): China Securities Co., Ltd.’s Verification Opinion on Dawning Information’s Use of Raised Funds to Replace Self-Raised Funds Used for Pre-investment in Fundraising Projects and Payment of Issuance Expenses—CFi.CN
• Dawning Information (603019) Latest Developments_F10_Tonghuashun Financial Services
• Dawning Information (603019) - Historical Trading Data | Dabanke
• Dawning Information sh603019 Stock Price, Market Data, Live Feed, News, Financial Reports and Data—Aigupiao
• SH.603019 Dawning Information—A-Share Real-Time Quote—Detailed Quote—etnet
• Dawning Information (603019) Technical Analysis_Future Forecast_Trading Suggestions—Investing.com
• Dawning Information (603019.SH) K-Line Chart & Technical Analysis | KlineVision
• Dawning Information (603019)_Fund Flows_Securities Star
• RMB 5.278 billion in Main Funds Bought into the Communications Sector Today
• Dawning Information (603019)—Detailed Share Capital and Shareholders

This report was automatically retrieved, compiled and generated by AI based on publicly available information. Information is current through the September 11, 2026 close; MACD and RSI(14) data are as of September 10, 2026, and shareholder-structure data are as of June 30, 2026. Differences in timeliness may exist. Specific data should be confirmed against the company’s official announcements and authoritative data terminals. This report is provided solely for information organization and research reference and does not constitute investment advice. Investors should make independent judgments and bear investment risks themselves.