Following the official implementation of the Hang Seng Index Series quarterly review on March 9, 2026, the market initially anticipated that CIDI (03881), ZHIDA TECH (02650), and NUOBIKAN (02635) would be simultaneously added to the Hong Kong Stock Connect list, thereby gaining access to southbound capital liquidity. However, a technical detail has led to an unexpected delay – these three companies are currently in the midst of a share subdivision process. Although they have successfully been included in the Hang Seng Composite Index, they did not enter the Stock Connect as expected. This apparent postponement is viewed by astute investors as a valuable structural opportunity, extending a favorable period and providing Hong Kong stock investors with a more ample window for strategic positioning.
The technical logic behind the delayed inclusion due to ongoing share subdivisions According to the quarterly review results released by Hang Seng Indexes Company on February 13, which were based on data up to December 31, 2025, NUOBIKAN and CIDI successfully met the stringent criteria for inclusion in the Hang Seng Composite Index and its related sectoral indices, based on metrics such as market capitalization, liquidity, and listing history. ZHIDA TECH also secured a key position in this round of index adjustments. Under the standard procedure, the Shanghai and Shenzhen Stock Exchanges should synchronously adjust the list of eligible stocks for the Hong Kong Stock Connect as the index changes take effect on March 9, meaning these three stocks should theoretically have become available to mainland investors starting next Monday (March 9). However, they did not appear on the updated list.
A deeper look reveals that all three companies are currently undergoing share subdivisions. In the Hong Kong market, the share subdivision period often involves parallel trading and may even entail a transition between old and new stock codes, with temporary codes sometimes used for trading. During this technical procedure, exchanges typically postpone the addition of stocks to new systems like the Stock Connect to ensure the stability of the settlement system and the accuracy of data clearing, waiting until the subdivision is fully complete before processing the inclusion. Therefore, despite meeting the market capitalization requirements, the actual operational inclusion of these three companies into the Stock Connect has been deferred due to their "ongoing subdivision" status, creating a timing gap where they are in the index but not yet in the Connect.
Judging from a technical standpoint, CIDI, ZHIDA TECH, and NUOBIKAN are expected to be adjusted into the Stock Connect on March 16, 2026, March 17, 2026, and March 25, 2026, respectively.
Historical Precedent: The Case of Jinjing New Energy (01783) Shows Share Subdivision Does Not Affect Inclusion Eligibility The market need not be overly concerned. A share subdivision does not alter the fundamental eligibility for Stock Connect inclusion; its impact is merely a technical delay. The case of Jinjing New Energy clearly confirms this. On September 23, 2025, the company's original shares (01783) were subdivided proportionally into new shares (02945), with parallel trading occurring. At that time, the Hong Kong Stock Connect list was also adjusted accordingly: the original code 01783 was first removed, and then, after the parallel trading period began, the original code 01783 was reinstated. This precedent fully demonstrates that eligibility for the Stock Connect is based on a company's fundamental value and its status as a Hang Seng Index constituent, not on short-term changes in share par value. A subdivision only alters the share's par value and trading unit; it does not change the company's equity substance nor constitute a policy barrier to inclusion. Thus, it is certain that CIDI, ZHIDA TECH, and NUOBIKAN will enter the Connect after their parallel trading begins, on March 16, March 17, and March 25, 2026, respectively.
Inclusion Imminent as the Low-Price Window During Subdivision Nears Its End As the share subdivision processes conclude, the technical status of these three stocks will be resolved. Industry analysis suggests that once the subdivision procedures are fully completed and the shares resume normal trading under their standard codes, the Hong Kong Stock Connect channel will open to them immediately. At that point, these three companies will gain full access to the trillion-yuan pool of mainland individual and institutional capital, directly benefiting from the influx of southbound liquidity.
Reflecting on 2025, southbound capital achieved a record net inflow exceeding HK$1.4 trillion, a trend that has continued into 2026. For small to mid-cap companies in need of liquidity support to bolster their share prices and broaden financing channels, inclusion in the Stock Connect is undoubtedly a key catalyst for value re-rating.
Conclusion: An "Unexpected" Delay Creates a "Golden Window," Extending Positive Catalysts and Enhancing Investment Safety Margin The temporary exclusion of these three stocks from the Stock Connect due to the ongoing subdivisions might seem like a barrier preventing mainland buying power, thereby delaying an anticipated sharp price increase. However, for rational Hong Kong stock investors, this actually presents a rare opportunity born from an apparent setback.
First, it extends the positioning cycle. If the stocks had been included on March 9, the immediate influx of southbound funds would likely have caused a sharp, sudden surge in their prices, leaving little time for ordinary investors to establish positions. The current delay provides a valuable golden window for investors who missed the initial opportunity.
Second, it postpones the "sell-on-news" risk. Capital markets often follow the adage that "good news realized is bad news." If inclusion coincided with a sharp price rise, it would often trigger substantial profit-taking. The delay caused by the subdivision transforms this major positive catalyst from an "instantaneous event" into a "sustained expectation." This not only absorbs short-term speculative selling pressure but also bases the valuation re-rating logic on the companies' long-term fundamentals and the prospect of sustained future capital inflows, creating a structural safety margin through the "extension of positive catalysts."
In summary, ZHIDA TECH, NUOBIKAN, and CIDI are currently in the final quiet period before their anticipated inclusion. As the share subdivision work nears completion, this rare low-price positioning window is narrowing. For medium to long-term investors focused on the liquidity benefits of the Stock Connect and optimistic about the companies' fundamentals, the current period of price adjustment and consolidation may represent the final opportunity to position before a potential upward move.
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