On August 12, the Hong Kong stock market recorded a net sell-off of HK$2.906 billion from southbound trading. The Shanghai-Hong Kong Stock Connect saw a net outflow of HK$1.882 billion, while the Shenzhen-Hong Kong Stock Connect recorded a net sale of HK$1.024 billion.
Shares that attracted the most net buying from southbound capital included MINIMAX-W (00100), TENCENT (00700), and SMIC (00981). On the selling side, the largest net disposals were for BABA-W (09988), KB LAMINATES (01888), and HUA HONG GRACE (01347).
In terms of specific stocks, MINIMAX-W (00100) and Z.AI (02513) received net inflows of HK$709 million and HK$416 million, respectively. Morgan Stanley noted that China's large language model industry is undergoing a structural shift from price competition to intelligence competition. The bank highlighted that DeepSeek has significantly raised its API prices, while the K3 model from Kimi and Qwen3.8-Max have entered the large-parameter era with 2.8 trillion and 2.4 trillion parameters, respectively. Additionally, open-source model licensing terms are tightening. These three changes collectively point to a healthier commercial environment, with pricing returning to rational levels, pathways for monetization broadening, and entry barriers rising.
TENCENT (00700) saw net buying of HK$683 million. The company released its second-quarter results after the market close. Revenue for the period grew 11% year-on-year to RMB 204.8 billion, slightly exceeding the Bloomberg consensus estimate of RMB 202.8 billion. Net profit rose 0.7% year-on-year to RMB 56 billion, falling short of the market expectation of RMB 58.4 billion. Capital expenditure surged to RMB 52.8 billion, far exceeding the projected RMB 32.1 billion, resulting in negative free cash flow of RMB 13.8 billion for the quarter.
SMIC (00981) attracted net buying of HK$456 million, while HUA HONG GRACE (01347) faced net selling of HK$495 million. Both foundry giants are scheduled to release their second-quarter financial results on August 13. BOC International previously noted that HUA HONG GRACE commands a higher valuation multiple due to its greater exposure to AI power analog, a better profit expansion trajectory, and the potential value from the injection of Huali Micro assets. In contrast, SMIC was downgraded to a "hold" rating by BOC International due to more moderate growth trends and a balance sheet increasingly burdened by capacity expansion and mergers and acquisitions.
XIAOMI-W (01810) received net buying of HK$176 million. On August 11, Xiaomi officially launched the REDMI K100 Pro series smartphones, featuring a next-generation super pixel screen that has drawn attention in the display technology field. Xiaomi Group President Lu Weibing commented that through collaboration with a team from Tsinghua University, the company has transformed laboratory theories into final mass production, making Xiaomi the third company globally and the first in China capable of self-research from the light-emitting material layer.
KB LAMINATES (01888) saw a net sell-off of HK$979 million. UBS noted that even if the current cycle of traditional copper-clad laminate (CCL) price increases ends, the firm does not expect earnings to decline as in past cycles, due to the company's expansion into AI-related upstream materials and CCL business, which will provide new structural growth drivers. Its vertically integrated business model is also a key differentiating advantage. The bank believes that the stock's roughly 60% decline from its June high presents an attractive opportunity.
Additionally, MEITUAN-W (03690) received net buying of HK$106 million. Meanwhile, 兆易创新 (03986), 长飞光纤光缆 (06869), and BABA-W (09988) faced net selling of HK$129 million, HK$244 million, and HK$1.46 billion, respectively.
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