On June 4, GDS Holdings (万国数据-SW) fell 3.02% in regular trading, trading at HK$34.02/share, with trading volume of HK$18.66 million. The stock resumed its downward trajectory after a brief rebound supported by multiple buy ratings from major banks.

On the news front, concerns over the company's Q1 earnings quality and aggressive capital expenditure plans continue to suppress valuation recovery. The company reported Q1 net profit of RMB 2.652 billion, but over 80% — approximately RMB 2.136 billion — stemmed from a one-time investment gain related to DayOne equity operations. Excluding this non-recurring item, core revenue growth decelerated to single digits, with adjusted EBITDA rising only 8.0% year-over-year. Meanwhile, management reiterated a three-year capex plan of RMB 30-50 billion for new data center construction, compounding market anxiety over near-term financial pressure amid shrinking operating cash flows. The stock has previously corrected over 15% since the Q1 report release on May 20, and despite institutional target prices suggesting 50-60% upside, investor skepticism over profit sustainability continues to cap rebounds.

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