A strong buying trend is sweeping into optical communication and optical semiconductor-related stocks, driven by news of the U.S. pushing to restrict imports of Chinese-made optical transceivers and growing expectations for expanded investment in optical communication networks for AI data centers. During the morning session on the 5th, Daehan Optical Communication traded at 11,630 won, up 1,450 won (14.24%) from the previous trading day. The intraday high reached 12,220 won, with trading volume exceeding 17.27 million shares.

Optical Communication Stocks Rally in Tandem... Kwang Electronics Up 17.87%, Light & Electronics Surges 28.99% Kwang Electronics traded at 6,860 won, up 17.87%, after recording an intraday high of 7,140 won. Light & Electronics jumped 28.99% to 2,870 won, nearing the daily limit, while Bitsem Electronics rose 10.71% to 8,370 won. Optical semiconductor and telecommunications component stocks also showed strength. RF Materials climbed 13.69% to 34,050 won, and Seoul Semiconductor gained 5.70% to 9,270 won. RFHIC rose 8.72%, Seoul Biosys 9.04%, and Lycom 7.31%.

Drivers of the Rally: U.S. Push for Regulations on Chinese Data Center Components The key driver behind the surge in related stocks is the news that the U.S. government is pursuing regulations on Chinese-made data center components. Optical transceivers are components that convert electrical and optical signals bidirectionally, enabling the transmission of large volumes of data between servers and network equipment. In AI data centers where GPUs are deployed at scale, high-performance optical transceivers, optical fibers, and optical cables are used together to increase inter-server connection speeds and data throughput.

Daehan Optical Communication is an optical communication infrastructure company that produces optical fibers and cables, not a manufacturer of optical transceivers. Therefore, it is difficult to conclude that U.S. regulations on Chinese optical transceivers will directly lead to increased orders for Daehan Optical Communication. However, the stock price is interpreted as reflecting expectations that non-Chinese optical fiber and cable supply chains could gain prominence in the process of reducing reliance on Chinese optical communication equipment.

North American AI Data Center Orders Already Secured... Totaling 41.1 Billion Won Daehan Optical Communication has already secured order performance in the U.S. AI data center optical cable market. According to NewsPim, the company signed a second contract in June to supply optical cables to a U.S. hyperscale AI data center. The contract is worth 23.68 million USD (approximately 35.5 billion won), and when combined with the first batch secured in February, the total supply volume amounts to approximately 41.1 billion won. The products are scheduled to be supplied to the North American region from July 2026 through the end of 2027.

Outlook: Implementation of Regulations and Earnings Contribution to Be Key Variables for Future Stock Prices The simultaneous rally in optical communication-related stocks appears to be the result of both the U.S. push to regulate Chinese optical transceivers and Daehan Optical Communication's order performance for North American AI data centers coming to the forefront. The buying momentum spread from companies involved in optical signal conversion components, such as Kwang Electronics, Light & Electronics, and Bitsem Electronics, to optical and compound semiconductor-related companies, including Seoul Semiconductor and RF Materials.

However, the actual proportion of data center business and product structures differ among companies classified under optical communication and optical semiconductors. Whether the regulatory review translates into actual implementation and whether Daehan Optical Communication's existing orders lead to improvements in revenue and profitability are expected to serve as key criteria for determining future stock price trends.

[This article is provided as reference material for investment decisions and does not recommend the purchase or sale of any specific stock. Responsibility for stock investments lies with the investor. This article was written with AI assistance.]