Listed Companies Seize Development Opportunities in the Liquid-Cooled Server Market

With the continuous upgrading of AIGC (Artificial Intelligence Generated Content) technology and the rapid iteration of the chip industry, data centers are facing unprecedented challenges in heat dissipation for high-power chip servers and energy consumption caused by growing computing power. Against this backdrop, liquid cooling technology, which features efficient heat dissipation, energy conservation, and low carbon emissions, has become an inevitable trend in the development of data center cooling technologies.

Recently, the concept of liquid-cooled servers has continued to heat up. On August 18th, shares of multiple companies surged to their daily limit, including Sugon Data Infrastructure Innovation Technology (Beijing) Co., Ltd., Shanghai Guanlong Valve Energy-Saving Equipment Co., Ltd., Guangzhou Gaolan Energy-Saving Technology Co., Ltd., Shenzhen Qiangrui Precision Technology Co., Ltd., and Ruijie Networks Co., Ltd.

Expanding Market Scale

Currently, liquid-cooled servers are in a phase of rapid penetration, with internet enterprises and operators taking the lead in large-scale deployment, driving continuous market expansion. According to estimates from Zheshang Securities, the liquid cooling market is growing rapidly driven by NVIDIA GPUs and self-developed ASIC chips from major cloud service providers. It is projected that the market scale of the liquid cooling industry will reach 35.4 billion yuan, 71.6 billion yuan, and 108.2 billion yuan in 2025, 2026, and 2027 respectively.

The mainstream technical routes for liquid-cooled servers include cold plate cooling and immersion cooling. The former is more popular due to its lower transformation cost, while the latter is more suitable for ultra-large-scale clusters,' said Guo Tao, Deputy Director of the China E-Commerce Expert Service Center.

A staff member from Beijing Qinhuai Data Co., Ltd. (hereinafter referred to as 'Qinhuai Data') told reporters from Securities Daily that immersion liquid cooling technology involves submerging servers in cooling liquid, which is a non-conductive fluorinated liquid with extremely high costs. Currently, the company mainly adopts cold plate liquid cooling technology solutions for liquid cooling.

According to the IDC report China Half-Yearly Liquid-Cooled Server Market Tracker (H2 2024), China's liquid-cooled server market maintained rapid growth in 2024, with the market scale reaching US$2.37 billion, a 67.0% increase compared to 2023. Among them, the market share of cold plate solutions further expanded.

In the long run, liquid-cooled servers are expected to become the mainstream heat dissipation solution for data centers, driving the industry toward higher technical levels and large-scale development.

Active Layout by Industry Chain Companies

Facing the explosive growth in market demand, industry companies are intensively deploying businesses related to liquid-cooled servers. It is understood that in addition to cold plate liquid cooling, Qinhuai Data also offers various air cooling and liquid cooling solutions such as IDEC (Indirect Evaporative Cooling), waterless cooling, and immersion liquid cooling, supporting high-density cabinets up to 140kW. A relevant person in charge of Qinhuai Data stated, 'In response to the trend of liquid cooling in data centers, the company, together with ecological partners, has initiated the project approval for a series of industry standards on the full-life-cycle quality control specifications of cold plate liquid cooling systems, accelerating the standardization and regularization of cold plate liquid cooling systems in data centers.'

Sugon Information Industry Co., Ltd. recently launched Nebula800, China's first industry-standardized super-intelligent integrated computing power platform. This platform integrates various advanced liquid cooling technologies and dynamic energy optimization mechanisms, which can increase deployment density and reduce energy consumption during high-load operation.

Feilong Auto Parts Co., Ltd. revealed during a recent survey that the company currently has 80 customers in the liquid cooling field (including those with established connections) and over 120 projects underway, with some projects already in mass production. In addition to consolidating the domestic market, the company is actively expanding overseas server liquid cooling markets to continuously expand its business territory. In response to the growing demand for liquid cooling heat dissipation in robot joints and other components, the company is actively deploying in the robot liquid cooling market relying on its technical advantages in new energy thermal management products such as electronic pumps, temperature control valves, and integrated modules.

Zhuhai Bojie Electronics Co., Ltd. stated during a recent survey that the company continues to provide AI server testing equipment to major overseas customers, with self-developed liquid cooling heat dissipation solutions embedded in the testing equipment, and has accumulated relevant technical reserves and solutions.

Driven by the market, multiple listed companies are expected to achieve significant growth in their 2025 interim results.

In the first half of this year, Beijing Zhongshi Weiye Technology Co., Ltd. (hereinafter referred to as 'Zhongshi Technology') is expected to achieve a net profit attributable to shareholders of listed companies ranging from 116 million yuan to 129 million yuan, a year-on-year increase of 85.01% to 105.75%. Zhongshi Technology stated that under the empowerment of AI, new products in industries such as emerging consumer electronics and digital infrastructure (data centers, communication base stations, etc.) are iterating rapidly, leading to increased demand for new heat dissipation solutions. The company's revenue from efficient heat dissipation modules, core heat dissipation components, and high-performance thermal conductive materials has grown rapidly year-on-year.

Shenzhen Feirongda Technology Co., Ltd. (hereinafter referred to as 'Feirongda') expects to achieve operating income of approximately 2.886 billion yuan in the first half of the year, with a net profit of 155 million yuan to 170 million yuan, a year-on-year increase of 103.95% to 123.69%. Feirongda stated that the company's communication-related businesses progressed smoothly in the first half of the year. Among them, the AI server heat dissipation business has been advancing in an orderly manner in cooperation with some important customers, resulting in a significant increase in operating income. Relying on years of accumulated heat dissipation technology and strategic layout, the company continues to increase research and development and technical reserves, and constantly iterates products to maintain the sustainable development of its communication business.

'Looking ahead, with technological breakthroughs in two-phase cooling, microchannel liquid cooling, and other new technologies, as well as the reduction of costs through domestic cooling liquid research and development, liquid-cooled servers are expected to penetrate into small and medium-sized data centers,' said Guo Tao. It is projected that the penetration rate of liquid cooling will increase significantly in the next few years, becoming a key infrastructure for green computing.

Kres(Suzhou) Power Systems Technology Co., Ltd is an emerging company focused on fluid power solutions, and serve for the markets of Energy, Construction, Agriculture, Manufacturing, Transportation, Medical, Data Centers, etc., and was founded in 2022 with leading-edge engineering capabilities and innovative products to keep up with the changing customer needs. Including OCP standard UQD, UQDB, BMQC, manifold, EPDM hose and hose assemblies, FF9 full flow dual interlock quick disconnect coupling (a better replacement for FD83 series products), API heat transfer products, Gates EPDM hose and Wika products.

KRES FF9 connectors are specifically engineered for fluid transmission, electronic cooling, and data center liquid cooling applications, where full flow, fluid compatibility, and safety are of paramount importance. The FF9 series ball valve quick-disconnect couplings adopt a full-flow design and are now available in 2-inch, 1.5-inch, and the popular 1-inch sizes. The FF9 double interlock liquid cooling quick-change connector features a swivel structure at its tail, facilitating easy connection and disconnection. Additionally, its two connector halves are completely identical, simplifying maintenance, installation, and service processes.

· 100% full-flow interlock ball valve: The FF9 double interlock ball valve has a diameter of up to 21mm, ensuring large flow while reducing pressure drop, achieving large flow and low pressure drop, and has obtained SGS ROHS reports and Huace performance test reports.

· KRES interlock ball valve adopts a double interlock design with two locking mechanisms to prevent accidental disconnection and ensure data security.

· The FF9 liquid cooling quick-change ball valve has identical connector halves, making maintenance, installation, and service simple.

· As a liquid cooling quick-change ball valve for data centers, it has reliable and stable performance with minimal leakage, meeting the maintenance needs of safe machine relocation or shutdown.

· Standard body material of the liquid cooling quick-change connector: 304 stainless steel, with wide fluid compatibility, and other materials can be provided upon request.

· Standard sealing material of the liquid cooling quick-change connector: EPDM ethylene propylene diene monomer synthetic rubber, and other materials can be provided upon request.

· Operating temperature range of the liquid cooling-specific ball valve: -40℃ ~ 120℃