Chongqing Machinery & Electric (02722.HK) surged more than 12% during Tuesday's session, reaching HK$1.44 per share with turnover hitting HK$39.58 million. The rally follows Nvidia's July 15 announcement to resume H20 chip sales in China, reversing an April 16 suspension prompted by U.S. government restrictions.

Market analysts anticipate accelerated investment in AI infrastructure. CITIC Securities projects Chinese AI firms will significantly boost capital expenditure during late 2025 to meet burgeoning artificial intelligence demands, potentially unlocking opportunities across the industrial chain. GF Securities observes that Q3 will likely mark the resumption of regular data center procurement cycles by major domestic enterprises. Despite seasonal order fluctuations, diesel generator prices maintained upward momentum, reflecting persistently tight supply-demand dynamics. This sets the stage for potential price hikes and profit realization in the latter half of the year.

Earlier research from CICC highlighted how China's booming AIDC and data center construction drive robust demand for premium diesel generators. The firm noted overseas manufacturers like Cummins have registered substantial revenue and margin growth in power systems amid exploding data center needs.

Notably, Chongqing Machinery & Electric's collaboration with Cummins traces back to 1981. Their partnership culminated in the October 1995 establishment of Chongqing Cummins Engine Company – an equally owned joint venture. This entity has since evolved into China's premier manufacturer of high-horsepower engines.