China plans a $295 billion investment in data centers, boosting VNET and GDS shares amid state-backed infrastructure expansion.
VNET Group Inc. (NASDAQ:VNET) surged 9% on June 9 after China announced a $295 billion national data center development plan. The initiative aims to build a network of interconnected facilities, with state-owned carriers like China Mobile and China Telecom leading operations.
Morgan Stanley previously maintained an Overweight rating on VNET, citing a $16 price target and improved shareholder issues following partnerships with CATL affiliates. The firm highlighted VNET’s first-mover advantage in premium cloud resources, supported by 500 megawatt MOUs.
The plan prioritizes domestic technology, with Chinese vendors supplying 80% of the infrastructure. VNET, a provider of interconnectivity and managed hosting services, stands to benefit from the state-driven demand.