VNET Group (VNET) is likely to see large new orders from hyperscalers amid growing data center demand in China and other countries, Morgan Stanley analysts said in a note to clients Monday.

The analysts said they expect the China-based data center operator's revenue will rise 30% in Q2 of 2026, and increased their revenue forecasts by 1.6% to 5% in 2025 to 2027, which they attributed to "stronger developments in the wholesale business." As a result, the analysts said they increased their adjusted their outlook for earnings before interest, taxes, depreciation, and amortization by 2% over the same period.

The firm raised its price target on VNET stock to $14 from $12 and maintained its overweight rating.

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