Shares of YOFC (06869) have plummeted more than 10%. At the time of writing, the stock was down 9.5% to HK$12.76, with a turnover of HK$1.755 billion.

The decline follows a surge in optical fiber prices and an existing supply-demand gap, which is prompting several companies to initiate plans for expanding production of preforms and optical fibers.

Hangzhou Cable Co.,Ltd. has announced plans for a private placement to raise up to 2.88 billion yuan for projects including the construction of a super factory for the R&D and manufacturing of optical fiber preforms, quartz mother materials, and new optical fibers.

Previously, both FiberHome Telecommunication Technologies and Lingyi iTech announced similar plans. The former intends to raise up to 2.913 billion yuan for projects like intelligent optical fiber manufacturing, while the latter plans to participate in the restructuring of Futong Jiashan to enter the optical fiber communications sector.

In a recent research report, Morgan Stanley noted that while the market has previously been concerned about supply risks from new capacity expansions, the investment bank expects that capacity expansion will take time. Meanwhile, demand driven by the booming development of AI infrastructure remains robust. Therefore, the momentum for earnings growth is not expected to change materially over the next 6 to 12 months.

YOFC is also a leader in next-generation technology innovation. In June 2026, it successfully completed the world's first field trial of a Hollow-Core Fiber (HCF) Wavelength Division Multiplexing (WDM) transmission system, further solidifying its technological leadership position.