Adds blog post

Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

DATA CENTRES IN SPACE: SPOTTING THE WINNERS

The prospect of data centres moving into space is drawing interest from electrical equipment investors, with Citi seeing opportunities for some suppliers and disruption for others.

The U.S. bank says space-based data centres would be significantly different from terrestrial facilities. Power would move to 100% solar, grid connections won't be needed and cooling systems would require a different design. However, rack-level electrical systems should stay broadly similar.

Citi sees Legrand LEGD.PA as the clearest potential beneficiary thanks to its rack-level power management exposure, while Siemens SIEGn.DE could also gain, being an existing supplier of design software to Elon Musk's SpaceX SPCX.O.

The long-term opportunity could be sizeable, even though market share uncertainty and execution challenges make it too early to factor into forecasts, it says.

According to Citi, SpaceX's 100GW annual deployment ambitions could lift demand for certain electrical equipment companies by around five times by the early 2030s.

The strongest growth prospects are seen in solar connectivity, low-voltage power control and optical networking. Citi points to the use of laser links between satellites, rather than wires, as a potential opportunity for Halma HLMA.L.

By contrast, power generation suppliers like Siemens Energy ENR1n.DE and Wartsila WRT1V.HE may have little to gain because space data centres would rely entirely on solar. Citi also expects an initial 48-volt direct-current architecture rather than the higher-voltage systems for land facilities.

Cooling would also change dramatically, with radiative cooling replacing conventional data-centre designs.

(Danilo Masoni)

*****

EARLIER LIVE MARKETS POSTS

ENERGY STOCKS GAIN, THE REST STRUGGLE CLICK HERE

EUROPE BEFORE THE BELL: EYES ON THE GULF AGAIN CLICK HERE

CEASEFIRE? WHAT CEASEFIRE? CLICK HERE