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GDS Holdings Ltd. (HK:9698)
:9698
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GDS Holdings Ltd. (9698) AI Stock Analysis

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HK:9698

GDS Holdings Ltd.

(Frankfurt:9698)

Rating:52Neutral
Price Target:
HK$39.00
▲(8.70% Upside)
The overall stock score of 52 reflects the high revenue growth and strong EBITDA margin. However, risks from high leverage, negative free cash flow, and unfavorable valuation metrics significantly dampen the stock's attractiveness. The technical analysis indicates potential for a short-term correction due to overbought conditions.
Positive Factors
Business Expansion
GDS Holdings Ltd is the leader of carrier-neutral data centres in China, serving major Chinese cloud and internet companies with self-developed data centres in first-tier cities.
Growth Catalysts
Key catalysts for GDS include potential DayOne IPO and expected listing of C-REIT, which will accelerate deleveraging and free up capital for growth.
Market Demand
Growing inference demand will support GDS’s domestic business growth, with the company well-positioned to capture the increasing demand for data centers in China.
Negative Factors
Demand Slowdown
A slowdown in demand from major customers will result in lower utilisation and returns.
International Challenges
The new US restrictions for the overseas distribution of AI chips can potentially impact GDS’s international segment.
Pricing Pressure
Excess supply of data center capacity in top-tier cities will lead to pricing pressures and could impact returns.

GDS Holdings Ltd. (9698) vs. iShares MSCI Hong Kong ETF (EWH)

GDS Holdings Ltd. Business Overview & Revenue Model

Company DescriptionGDS Holdings Limited, together with its subsidiaries, develops and operates data centers in the People's Republic of China. The company provides colocation services comprising critical facilities space, customer-available power, racks, and cooling; managed hosting services, including business continuity and disaster recovery, network management, data storage, system security, operating system, database, and server middleware services; managed cloud services; and consulting services. It serves cloud service providers, large Internet companies, financial institutions, telecommunications and IT service providers, and large domestic private sector and multinational corporations. The company was founded in 2001 and is headquartered in Shanghai, the People's Republic of China.
How the Company Makes MoneyGDS Holdings Ltd. generates revenue primarily through the leasing of data center space and related services to its clients. The company operates on a colocation model, where customers rent physical space, power, and cooling within GDS's data centers to house their servers and IT infrastructure. Additionally, GDS offers managed hosting services, where they provide comprehensive IT management, and cloud services, which allow customers to leverage GDS's infrastructure for scalable computing resources. The company has strategic partnerships with leading technology firms to enhance its service offerings and drive customer acquisition. Key revenue streams include recurring fees from long-term leases, service charges for additional IT management, and fees from cloud resources usage. GDS's earnings are significantly influenced by its ability to maintain high occupancy rates and expand its data center facilities to meet growing demand.

GDS Holdings Ltd. Financial Statement Overview

Summary
GDS Holdings Ltd. shows strong revenue growth and a robust EBITDA margin, which are positive indicators of financial performance. However, the high leverage and negative free cash flow present financial risks, necessitating improved debt management and free cash flow generation.
Income Statement
68
Positive
GDS Holdings Ltd. has shown a strong revenue growth rate of 8.55% TTM, signaling positive business expansion. The gross profit margin has slightly improved to 22.47% TTM, indicating efficient cost management. However, the net profit margin of 40.47% TTM is largely driven by a significant increase in net income rather than operational efficiency, as reflected by an EBIT margin of 11.45% TTM. EBITDA margin is robust at 52.02% TTM, highlighting strong earnings before interest, taxes, depreciation, and amortization.
Balance Sheet
55
Neutral
The company maintains a high debt-to-equity ratio of 1.80, suggesting significant leverage, which poses potential financial risk. The return on equity (ROE) stands at 18.65% TTM, indicating efficient use of equity to generate profits. However, the equity ratio of 33.09% suggests a reliance on debt financing rather than equity, which can affect financial stability.
Cash Flow
60
Neutral
Operating cash flow is positive and sufficient compared to net income, with a high operating cash flow to net income ratio of 0.62 TTM. However, free cash flow remains negative at -3.45 billion TTM, indicating high capital expenditures. The free cash flow to net income ratio is negative, showing challenges in generating free cash flow despite profitability.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue10.32B9.96B9.33B7.82B5.74B
Gross Profit2.22B1.92B1.94B1.78B1.55B
EBITDA4.39B1.36B3.85B3.27B2.34B
Net Income3.43B-4.29B-1.27B-1.19B-669.21M
Balance Sheet
Total Assets73.65B74.45B74.81B71.63B57.26B
Cash, Cash Equivalents and Short-Term Investments7.87B7.71B8.61B9.97B16.26B
Total Debt44.46B47.99B44.68B37.79B24.63B
Total Liabilities49.98B54.32B50.63B47.10B31.69B
Stockholders Equity23.54B19.96B24.07B24.47B25.57B
Cash Flow
Free Cash Flow-1.03B-4.19B-4.95B-8.50B-7.70B
Operating Cash Flow1.94B2.07B2.86B1.20B320.89M
Investing Cash Flow-8.76B-6.33B-11.27B-13.69B-9.38B
Financing Cash Flow17.06B3.14B4.86B8.12B20.14B

GDS Holdings Ltd. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price35.88
Price Trends
50DMA
30.73
Positive
100DMA
28.12
Positive
200DMA
26.65
Positive
Market Momentum
MACD
1.16
Positive
RSI
58.64
Neutral
STOCH
49.39
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:9698, the sentiment is Positive. The current price of 35.88 is above the 20-day moving average (MA) of 35.74, above the 50-day MA of 30.73, and above the 200-day MA of 26.65, indicating a bullish trend. The MACD of 1.16 indicates Positive momentum. The RSI at 58.64 is Neutral, neither overbought nor oversold. The STOCH value of 49.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:9698.

GDS Holdings Ltd. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
61
Neutral
$34.83B4.75-10.43%2.08%6.55%-10.00%
52
Neutral
HK$57.75B0.84%8.98%99.80%
$2.04B26.344.43%0.93%
$589.69M-4.20%2.59%
$4.76B16.459.69%1.98%
€139.95M12.6844.71%
50
Neutral
HK$1.48B-127.76%1.50%43.23%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:9698
GDS Holdings Ltd.
35.88
24.92
227.37%
CFTLF
Chinasoft International
0.72
0.28
63.64%
DCHIF
Digital China Holdings
0.35
-0.04
-10.26%
TSYHF
TravelSky Technology
1.66
0.30
22.06%
DE:CCX
CCID Consulting Co. Ltd. Class H
0.18
0.08
80.00%
HK:3680
Suoxinda Holdings Limited
1.78
0.74
71.15%

GDS Holdings Ltd. Corporate Events

GDS Holdings Launches C-REIT on Shanghai Stock Exchange
Aug 5, 2025

GDS Holdings Limited announced the official listing and trading of its NF GDS Data Center Infrastructure Real Estate Investment Trust (C-REIT) on the Shanghai Stock Exchange, starting August 8, 2025. This move marks a significant step in expanding its financial instruments and presence in the Chinese market, potentially impacting its operations and positioning within the industry.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Limited Releases ESG Report to SEC
Jul 29, 2025

GDS Holdings Limited has announced the release of its Environmental, Social, and Governance (ESG) report, which has been furnished to the Securities and Exchange Commission of the United States. This announcement reflects the company’s commitment to transparency and accountability in its operations, potentially impacting its reputation and stakeholder relations positively.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Completes Successful C-REIT IPO on Shanghai Stock Exchange
Jul 16, 2025

GDS Holdings Limited announced the successful completion of its C-REIT initial public offering on the Shanghai Stock Exchange, which attracted significant interest from both institutional and retail investors. The institutional order book was 166 times covered, and the retail offering was 456 times over-subscribed, indicating strong market demand and positioning the company favorably in the data center infrastructure investment sector.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Sets Final Price for Oversubscribed C-REIT IPO
Jul 2, 2025

GDS Holdings Limited announced the final offering price for its NF GDS Data Center Infrastructure Real Estate Investment Trust (C-REIT) IPO on the Shanghai Stock Exchange at RMB3.00 per unit. The IPO was 166 times oversubscribed, and the C-REIT will issue 800 million units, raising RMB2,400 million in gross proceeds. GDS will sell a 100% equity interest in a project company holding data center assets to the C-REIT, receiving net cash proceeds of approximately RMB2,111 million. GDS will also reinvest RMB480 million to acquire 20% of the C-REIT units and continue managing the data center assets, securing recurring annual fee income.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Announces Approval of Key Resolutions at 2025 AGM
Jun 26, 2025

GDS Holdings Limited announced the results of its annual general meeting held on June 26, 2025, where all proposed resolutions were approved by shareholders. Key resolutions included the re-election of directors, the appointment of KPMG Huazhen LLP as independent auditor for the fiscal year ending December 31, 2025, and authorization for the board to issue new shares up to 30% of the existing share capital over the next 12 months. These decisions are expected to impact the company’s governance and capital structure positively.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Launches C-REIT IPO on Shanghai Stock Exchange
Jun 26, 2025

GDS Holdings Limited has announced the approval and launch of an initial public offering (IPO) for its NF GDS Data Center Infrastructure Real Estate Investment Trust (C-REIT) on the Shanghai Stock Exchange. The transaction involves GDS selling 100% equity interest in a project company with stabilized data center assets to the C-REIT, which will be funded through the IPO. GDS will subscribe for 20% of the C-REIT units, while the remaining will be taken up by institutional and retail investors. The transaction is expected to close in the coming weeks, subject to market conditions and closing requirements.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Closes $550 Million Convertible Notes Offering
Jun 1, 2025

GDS Holdings Limited announced the closing of its offering of US$550 million convertible senior notes due in 2032, which included the full exercise of an option to purchase an additional US$50 million in notes. The company plans to use the net proceeds of approximately US$534.9 million for working capital and refinancing existing debt. The notes, which bear an interest rate of 2.25% per year, are convertible into American depositary shares and have specific redemption conditions, reflecting GDS Holdings’ strategic financial maneuvers to strengthen its capital structure.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Limited Announces ADS Offering to Bolster Market Position
May 29, 2025

GDS Holdings Limited announced an overseas regulatory announcement regarding its offering of American Depositary Shares (ADSs). The company is conducting a delta placement of 6,000,000 borrowed ADSs and a concurrent primary offering of 5,200,000 ADSs. This move is part of their strategy to raise capital and strengthen their market position, potentially impacting stakeholders by altering the shareholding structure and increasing the company’s financial resources.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Limited Announces Overseas Regulatory Update
May 29, 2025

GDS Holdings Limited announced an overseas regulatory update related to a current report on Form 6-K, which includes underwriting agreements for the delta placement of borrowed ADSs and the primary ADSs offering. This announcement highlights the company’s strategic financial maneuvers to strengthen its market position and possibly expand its operational capabilities. The update may have significant implications for stakeholders, particularly concerning the influence of weighted voting rights on shareholder resolutions.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Limited Announces Delta Placement of 6 Million ADSs
May 29, 2025

GDS Holdings Limited announced a delta placement of 6,000,000 American Depositary Shares (ADSs) as part of a borrowing agreement with J.P. Morgan Securities plc. This move is intended to facilitate derivative transactions for investors in the company’s convertible senior notes, allowing them to hedge market risks. The company will not receive proceeds from the sale of these ADSs, but it will earn a nominal lending fee. This strategic financial maneuver is expected to support the company’s market positioning by providing flexibility for investors, although it does not directly impact the company’s earnings per ADS.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Announces Major ADS Offering and Strategic Financial Moves
May 29, 2025

GDS Holdings Limited announced a primary offering of 5,200,000 American depositary shares (ADSs), each representing eight Class A ordinary shares, with the proceeds going to the company. Concurrently, they are offering 6,000,000 ADSs through a Delta Placement of Borrowed ADSs, facilitated by J.P. Morgan Securities. This move is part of a broader strategy involving convertible senior notes to hedge market risks for investors. The completion of these offerings is interdependent, with implications for the company’s financial strategy and market positioning.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Limited Releases Q1 2025 Financial Results
May 20, 2025

GDS Holdings Limited announced its unaudited financial results for the first quarter ending March 31, 2025. The results are available on the Hong Kong Stock Exchange website and the company’s website. This announcement may impact stakeholders due to the company’s weighted voting rights structure, which allows significant influence over shareholder resolutions by the WVR beneficiary.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$12.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Sets Record Date for Annual General Meeting
May 20, 2025

GDS Holdings Limited has announced the record date for determining the eligibility of shareholders to attend and vote at its upcoming annual general meeting. The record date is set for June 4, 2025, and shareholders must ensure their documents are lodged with the company’s Hong Kong branch by this date. Holders of American depositary shares can instruct JP Morgan Chase Bank on how to vote their shares, but they must do so before the record date due to time zone differences. This announcement is significant for stakeholders as it outlines the procedural requirements for participating in the company’s governance.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$12.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings to Announce Q1 2025 Financial Results
May 7, 2025

GDS Holdings Limited announced that its board of directors will meet on May 20, 2025, to approve the unaudited financial results for the first quarter ended March 31, 2025. The results will be announced after Hong Kong market hours and before the U.S. market opens on the same day. An earnings teleconference call will be held at 8:00 PM Hong Kong time, where management will discuss the results. This announcement is significant for stakeholders as it provides insights into the company’s financial performance and future outlook.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 16, 2025