Key Takeaways:
- Triata Capital sold 1.9 million GDS shares worth $80.9 million in Q1
- The hedge fund cut its stake by more than 60 percent
- GDS stock surged 67 percent over the past year before retreating
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Triata Capital sells $81M in GDS shares as data center stock rallies
Triata Capital Ltd sold 1.9 million shares of GDS Holdings Ltd in the first quarter, an $80.9 million reduction that cut the hedge fund's stake in the Chinese data center operator by more than 60 percent.
The sale reduced Triata's GDS position to 1.1 million shares worth $43.8 million at quarter-end, according to a May 14 SEC filing. The holding now represents 7.9 percent of the fund's $551.8 million in 13F reportable US equity assets, down from 12.6 percent in the prior quarter.
GDS shares surged 67 percent over the past year to $45.70 as of May 13, outperforming the S&P 500 by nearly 41 percentage points. The stock nearly doubled from about $24 in early 2025 to $48 by early 2026 before retreating to around $35 currently. The company's forward price-to-earnings ratio stood at 64 at the end of the first quarter, down from 344 a year earlier, as earnings growth narrowed the valuation gap.
The company reported strong first-quarter results, with revenue rising 24 percent year over year and adjusted EBITDA margin expanding to 57.9 percent from 48.6 percent. Net income jumped 247 percent, though that was boosted by the sale of its DayOne data center assets. GDS maintained its full-year guidance for the rest of the fiscal year.
The selloff may reflect profit-taking after the stock's rally pushed valuations higher, with the enterprise value-to-EBITDA ratio reaching about 15 by the end of the quarter. Triata's top holding remains PDD Holdings Inc at $212.8 million, or 38.6 percent of assets, followed by VNET Group Inc at $93.9 million and Qifu Technology Inc at $45.1 million. The fund reported 14 positions in total.
The stake reduction suggests Triata's management saw limited near-term upside at elevated valuations after a successful run. Investors will watch whether GDS can sustain its margin expansion and revenue growth trajectory when it reports second-quarter results later this year.
This article is for informational purposes only and does not constitute investment advice.
