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AI hyperscaler effect vaults China’s Zhongji Innolight to top of CSI 300 benchmark

Maker of optical modules surpasses CATL in weighting thanks to off-the-charts demand from Alphabet, Amazon, Meta and Huawei

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An AI data centre architecture is seen at the Wiwynn booth during Computex in Taipei on June 2. Photo: AFP
Zhang Shidongin Shanghai
The artificial intelligence frenzy has made Zhongji Innolight, a supplier of optical modules to US hyperscalers, the biggest constituent of China’s stock benchmark, highlighting AI’s profound impact on the world’s second-largest equity market.

The northern Shandong province-based company had a 5 per cent weighting on the CSI 300 Index on Friday, making it the largest of the 300 most valuable stocks on the Shanghai and Shenzhen exchanges. The index’s weighting is based on the market capitalisation of free-float shares.

Second-ranked Contemporary Amperex Technology Ltd (CATL), the world’s biggest maker of lithium batteries for electric vehicles, had a representation of 4.1 per cent, followed by liquor giant Kweichow Moutai at 3 per cent and another optical module maker, Eoptolink Technology, at 2.8 per cent. Zhongji Innolight first eclipsed CATL last month.
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The shake-up shows how AI is upending the market, rewarding the companies on the frontier of innovation while eschewing those in traditional industries. The change matches the global trend of concentration in AI stocks, with tech companies accounting for about 40 per cent of the weighting of the S&P 500 index.

Shares of Zhongji Innolight have nearly doubled this year in Shenzhen, extending a fivefold bull run in 2025. Demand for the company’s high-speed optical modules – used for data transmission across server racks in AI data centres – has been soaring as hyperscalers pour billions of dollars into AI infrastructure.

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The company supplies hyperscalers in the US and China. Alphabet, the parent of Google, was its biggest client, accounting for 22 per cent of its sales, according to Bloomberg data. Amazon and Meta Platforms were responsible for 11 per cent and 6.4 per cent of its business, respectively. Huawei Technologies was its biggest domestic customer, accounting for 5 per cent revenue, while Alibaba Group Holding made up 1.9 per cent, the data showed.

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