GF Securities has released a research report stating that starting March 2026, the new version of the Waste Electrical and Electronic Equipment (WEEE) processing standards will officially take effect. For the first time, it will include artificial intelligence servers and intelligent robots under its control, imposing stricter disposal requirements. The AI industry scale is projected to exceed 1.2 trillion yuan, generating substantial demand for standardized recycling, which benefits leading companies possessing dismantling qualifications. Dadi Ocean (301068.SZ), as a leading dismantling company in Zhejiang Province, has established a full industry chain for server recycling and achieves waste resource utilization and economies of scale through its "Huge Model".
Key views from GF Securities are as follows:
The inclusion of servers under WEEE control marks the arrival of a formalized era for AI product recycling. The new "Technical Specification for Pollution Control in the Treatment of Waste Electrical and Electronic Equipment" issued by the Ministry of Ecology and Environment takes effect in March 2026, replacing the 2010 version. Key changes include: (1) Expanding controlled categories, adding computer equipment (including AI servers) and intelligent consumer devices (including intelligent robots); (2) Specifying detailed pollution control requirements for storage, dismantling processes, and the utilization and disposal of by-products, making WEEE disposal more stringent, detailed, and standardized.
The formalization of cascade utilization and dismantling recycling benefits leading licensed enterprises. Taking servers as an example, current disposal methods mainly include cascade reuse (refurbishing whole units or component recovery for less demanding enterprises) and material recycling with environmental treatment (metal and material extraction, disposal of certain hazardous wastes). With AI-related electronic waste now under policy control, formal enterprises with WEEE dismantling qualifications are required to handle utilization and recycling. According to a report on China's AI development trends, China's AI industry is growing rapidly, with its scale expected to surpass 1.2 trillion yuan in 2026 (a year-on-year increase of nearly 30%). This growth creates extensive demand for standardized recycling, benefiting leading WEEE dismantlers such as Dadi Ocean, Zhongzai Zihuan, and Huaxin Environmental Protection.
Dadi Ocean: Zhejiang's leading WEEE dismantler initiates server recycling industry layout. As the leading WEEE dismantler in Zhejiang Province, following its acquisition of Hangzhou Veolia in 2025, the company's dismantling capacity increased from 3.6 million units/year to 7.12 million units/year. Post-acquisition, its market share of dismantling qualifications in Zhejiang is estimated to exceed 50%. In February 2026, the company established a subsidiary, "Hangzhou Zhisuan Chuangxiang Technology Co., Ltd.", to develop a closed-loop lifecycle for used and scrapped servers covering "recovery-assessment-remanufacturing-leasing". Leveraging its market position and share in standardized dismantling within Zhejiang, and with its dismantling base located in Yuhang District, Hangzhou (serving the local internet and AI industrial cluster), the company is well-positioned to benefit early from the rising demand for recycling in the AI industry, including servers.
Dadi Ocean: Achieves full industry chain layout for waste, realizes model compound interest across multiple waste streams. In 2025, the company acquired "Huge Environment", a leader in comprehensive residential waste recycling models in Zhejiang Province. Through a resident app for ordering and door-to-door waste collection by Huge, effective waste sorting and resource recovery are achieved. According to Huge's public communications, by the end of 2025, it covered 10 cities/counties/districts in Zhejiang and Jiangsu provinces, cumulatively reducing municipal solid waste by 1.184 million tons, with 2.6 million carbon accounts, and a resource utilization rate exceeding 96.3%. As the number of households served by Huge Environment increases and it expands into multiple waste categories, the scale effects of the Huge Model are gradually becoming apparent. Building on the reverse logistics system already established by Huge Environment, expanding from single-stream, low-value household waste to high-value waste streams (such as scrapped servers, waste appliances, and discarded e-bikes) offers significant potential for future profit elasticity and model optimization. For reference, overseas waste management leader WM.N boasts a market capitalization exceeding $96 billion, demonstrating the recognized value of waste resources in Western markets.
Companies suggested for attention include: Dadi Ocean, Huaxin Environmental Protection, and Zhongzai Zihuan.
Risk warnings include lower-than-expected orders and new business development, and policy change risks.