Morgan Stanley reports that NVIDIA (NVDA, Financial) has officially applied to sell its H20 GPU in China, expecting approval from U.S. authorities. This development is seen as a significant boost for the Chinese data center sector, potentially alleviating procurement bottlenecks faced by major cloud service providers in the country. The shortage of GPUs was a key reason for the sluggish data center orders in Q2 and the substantial stock price decline of IDC companies since March. The sector's recovery remains slow, but the anticipated approval could prompt a new wave of data center tenders by cloud service providers.
Morgan Stanley maintains a positive outlook on GDS Holdings (GDS), 21Vianet Group (VNET), and other industry players. GDS Holdings is highlighted as the top pick in the sector.
