VNET Group (VNET) Retires Notes, Is The Stock Still Cheap?

VNET Group (NasdaqGS:VNET) has moved to retire roughly 30% of its 2.00% Convertible Senior Notes due 2027 through privately negotiated buybacks totaling about US$80 million in cash, including accrued interest.

VNET Group's recent move on its convertible notes comes after a difficult run for holders, with the share price down 37.96% over the past month and 59.28% year to date, while the 1 year total shareholder return has declined 66.39%. The 3 year total shareholder return remains positive at 12.59%, which suggests that earlier momentum has faded sharply in the short term as investors reassess both risk and potential reward around the current US$3.71 price.

Scan how VNET Group compares with other data and infrastructure plays under pressure by checking our curated list of 54 AI infrastructure stocks.

VNET Group has just reduced a portion of its 2027 convertibles while the share price has retreated significantly. Is most of the rerating already reflected in the price, or does the current valuation still leave further potential upside on the table?

Most Popular Narrative: 73% Undervalued

Against the last close of $3.71, the most followed narrative for VNET Group points to a fair value of $13.93. The current quote sits far below that narrative anchor and puts the buyback of convertible notes in a very different light for anyone focused on long term potential rather than just recent price damage.

Strong, sustained growth in wholesale data center capacity utilization and demand, especially for AI-driven workloads in regions like Greater Beijing and Yangtze River Delta, positions VNET to benefit from the accelerating digitalization and increased AI/cloud adoption across China, directly supporting higher future revenues and occupancy rates.

VNET's rapid delivery and scalable modular construction technology (Hyperscale 2.0 framework) shortens build cycles and enables swift response to AI and cloud customer needs. This allows for faster order fulfillment and improved revenue realization, while also driving cost efficiency gains that enhance EBITDA margins.

See why 13 investors see VNET Group as 73% undervalued.

Result: Fair Value of $13.93 (UNDERVALUED)

Still, the VNET Group story depends heavily on refinancing sizeable debt between 2025 and 2027 and on capital intensive data center expansion not outpacing actual demand.

Find out about the key risks to this VNET Group narrative.

Next Steps

Mixed signals around VNET Group can feel disorienting. Move quickly, review the data for yourself, and weigh both the 2 key rewards and 2 important warning signs.

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