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The cooling required for Nvidia’s GPU server rack programs in information facilities is ready to create a $4.8 billion market by 2027, in response to Morgan Stanley Liquid cooling programs are the answer to “energy scarcity pressures” in information facilities, the financial institution mentioned in a July 30 report. “We imagine liquid cooling resolution for NVDA’s GB200 server rack system in information facilities can create a US$4.8bn [total addressable market] by 2027,” it mentioned. By enhancing thermal design energy and extra, such liquid cooling programs save between 10% and 15% on capital expenditure, in response to Morgan Stanley. The general price of a liquid cooling system is $82,460 per rack for Nvidia’s GB200 GPU server — placing it at 15 to twenty occasions larger than an air-cooling system for its H100 GPU rack. Nvidia’s GPUs dominate the market, and underpin most generative synthetic intelligence instruments. “Warmth stream knowhow, precision necessities and time-to-market supply are key successful components on this area,” mentioned Morgan Stanley analysts. Inventory picks Firms that stand to profit embrace suppliers with “confirmed cargo document,” amongst different components, they added. Names embrace information middle facility distributors Vertiv , Schneider Electrical , Taiwanese agency AVC and electronics manufacturing firm Delta Electronics . Amongst these names, Delta is Morgan Stanley’s high choose. It mentioned it likes Taiwanese agency Delta because it believes its liquid cooling resolution will add a further $280 million in AI cooling income in 2025. “We like its built-in resolution for each energy and cooling choices for information facilities. We expect it presents the simplest design to hyperscalers and information middle operators, because it goals to decrease the whole price of possession whereas assembly PUE necessities,” the financial institution’s analysts wrote. PUE is an effectivity metric for energy consumption in information facilities. Morgan Stanley raised its worth goal for the inventory from 400 to 488 New Taiwan {dollars} ($12.20 to $14.90), which represents potential upside of round 26%. The financial institution can also be constructive on AVC, which it says is “nicely positioned” to supply numerous air and liquid cooling merchandise to AI servers. It famous that AVC has been chosen as a significant GB200 chilly plate associate of Nvidia, referring to a element that removes warmth by utilizing liquid cooling know-how. “Our provide chain checks recommend AVC is the reference design for chilly plate for NVIDIA’s GB200 server rack liquid cooling system,” it added. Morgan Stanley expects AVC to roll out its first batch of shipments within the third quarter of this 12 months, and take 30% of the provision share for shipments in 2025. It raised its worth goal for AVC from NT$520 to NT$830 — a whopping 60% enhance. That might suggest potential upside of round 35%. — CNBC’s Michael Bloom contributed to this report.