GIGADEVICE (03986) saw its share price leap more than 8% during Tuesday morning trading. As of the latest update, the stock was up 8.48%, trading at HK$455.60, with turnover reaching HK$589 million.
The rally follows a joint announcement from the Ministry of Industry and Information Technology and the National Development and Reform Commission, which recently unveiled the "15th Five-Year Plan for the Development of the Electronic Information Manufacturing Industry." The plan emphasizes accelerating the advancement of advanced storage capabilities, promoting the concept of "strengthening computing through storage" and "substituting storage for computing," while enhancing the technical level of distributed and hyper-converged storage systems. It also calls for refining hierarchical data storage architecture and storage protocols.
Furthermore, the plan advocates breakthroughs in key technologies such as intelligent tiered storage, data sparsity optimization, and key-value caching. It encourages the development of next-generation storage products, including high-bandwidth flash memory, high-bandwidth memory, ferroelectric memory, resistive random-access memory, and magnetoelectric storage devices.
In a research note, Huatai Securities highlighted that supply in the memory chip sector remained persistently tight in the second quarter, driving both shipment volumes and average selling prices higher. The firm also noted that MCU product prices have begun to show moderate increases, collectively contributing to substantial quarter-on-quarter and year-on-year revenue growth for the company. Gross margin for the period reached an impressive 66.57%.
Looking ahead to the second half of 2026, the brokerage expects the industry cycle to continue its upward trajectory. GIGADEVICE's niche DRAM, SLC NAND, and NOR Flash products are anticipated to sustain the trend of rising volumes and prices. Additionally, the gradual ramp-up of custom storage projects is expected to drive robust earnings growth, supporting the maintained "Buy" rating.