Daiwa has revised its forecasts for Weichai Power (02338) to reflect the strong earnings performance of its power supply business in Q1 2026. The latest projections indicate net profit growth for 2027-2028 is expected to be 14% to 24% year-on-year, up from a previous estimate of 6% to 14%, primarily driven by robust demand from AI data centers. While maintaining a positive long-term outlook for Weichai due to strong AI data center demand, the firm has downgraded its rating from "Buy" to "Outperform" based on valuation considerations and potential near-term pressure on the LNG heavy-duty truck business if the Middle East conflict concludes. The H-share target price has been raised from HK$40 to HK$50.