Xiaomo: Still optimistic about China's AI model sector, which lists Smart Spectrum (02513) as the first choice for the sector

The Zhitong Finance App learned that J.P. Morgan Chase released a research report saying that China's demand for artificial intelligence models is in between the two stages of coding and demand for more extensive white-collar workers, and demand for AI other than coding appeared later than the bank's original expectations. J.P. Morgan believes that the market is overly pessimistic about China's AI model sector, still maintains an optimistic view, and lists Smart Spectrum (02513) as the first choice for the sector.

The bank believes that AI models can be viewed as the next generation of labor for enterprises, while model companies are similar to schools that train talents. Companies select models based on specific competency thresholds, so demand is growing in stages. Coding applications developed rapidly in late 2025 as model reliability requirements were met. China is currently at least six months behind the US and is still in the coding application stage. The bank is expected to gradually follow the US into a wider range of application fields thereafter.

The bank believes that commercialization of AI models and pricing capabilities can coexist. Leading model developers can, on the one hand, raise the prices of top models, and on the other hand attract price-sensitive users through low-cost products and continuously reduce their own inference costs. Smart Spectrum's unit inference costs under the same hardware conditions dropped by about 80% this year, and the gross margin of its open platform and API business rose from negative 0.4% a year ago to 24.6% in the first half of 2026. J.P. Morgan believes that the value of the industry will be concentrated on a few companies that can continue to launch cutting-edge models.

In terms of the company's progress, Smart Spectrum launches a new generation model about every two to three months, and the guidelines have been raised. The bank expects the GLM-5.5/GLM-6 launched in November to be the next catalyst. MiniMax-W (00100) mainly focuses on cost performance. If its M3 Pro, which was launched in November, is recognized by the market and can be priced according to cutting-edge models, J.P. Morgan may change to a more positive view.