Phancy (6682.HK): Heterogeneous compute meets rising intelligence demand; initiate at Overweight

We initiate coverage of Phancy (6682.HK) at Overweight with a HK$50 price target, based on 15x 2028E EV/EBITDA. Phancy has evolved from enterprise AI software and deployment into an AI infrastructure company spanning heterogeneous-compute optimization and Token production. We believe Phancy offers a favorable combination of continued growth in intelligence consumption and a structural need for optimization across China's increasingly fragmented compute environment. Its AI Platform provides a solid growth base, while API is opening a larger usage-based revenue pool by allowing Phancy to monetize compute, model adaptation and serving capabilities through Token production. We forecast 2026-28E revenue CAGR of 36% and expect adjusted net profit to reach Rmb0.9bn by 2028E, putting our 2028E adjusted net profit forecast 37% above consensus. AI Platform revenue grew 30% YoY in 1H26, while API revenue reached Rmb464mn in 1H26, up 861% YoY, and we expect API to remain the fastest-growing busine