Hong Kong-listed hard tech stocks gained momentum again this afternoon on June 24th. Huahong Grace surged 16% to a record high, while stocks like GigaDevice, SMIC, and Kingboard Laminates rose over 7%. The largest and most liquid* ETF tracking this sector, Huabao HK Connect Information Technology ETF (159131), saw its intraday price jump as much as 5%, currently up 4.10%, with real-time turnover reaching 2.352 billion yuan. Following yesterday's over 80 million yuan in purchases on dips, the fund saw another 42 million units subscribed during today's session, including 25 million units in net subscriptions, indicating strong investor confidence in the hard tech theme.
On the news front, tech analyst Tim Culpan pointed out that TSMC has begun notifying customers of price increases for its wafer foundry services. The hikes extend beyond the rumored 3nm process to cover all advanced processes at 7nm and below, with overall increases of about 5% to 10%, affecting roughly 75% of its wafer revenue sources.
Huaxin Securities noted in a research report that from 2018 to March 2026, the monthly 8-inch wafer capacity of domestic foundry leader SMIC steadily increased from about 450,000 wafers to approximately 1.078 million wafers, more than doubling. This growth occurred through three phases: steady climb, accelerated expansion, and rapid capacity ramp-up. Notably, SMIC persisted with counter-cyclical capacity expansion during industry downturns, building ample capacity for the subsequent recovery. In terms of quarterly shipments, Q3 2025 reached nearly 2.5 million wafers, a historical high, and Q1 2026 was around 2.509 million wafers, maintaining the peak level. Overall, domestic foundries have seized recovery opportunities through counter-cyclical expansion. The breakthrough in shipment scale reflects enhanced economies of scale and confirms the sustained demand and growth potential for mature-node chips in areas like automotive electronics, industrial control, and the Internet of Things.
Soochow Securities believes the current focus should remain on the AI technology theme while simultaneously monitoring the diffusion rhythm to midstream and downstream applications. If the AI theme spreads from upstream hardware to infrastructure and application software, Hong Kong stocks, which have higher weightings in these related directions, could potentially see a synchronized rally with US and mainland Chinese stocks. Meanwhile, in a high-volatility environment, attention should still be paid to high-dividend, stable cash flow assets to hedge against potential systemic disturbances.
Looking at the past six months, the underlying index of the hard tech-focused Huabao HK Connect Information Technology ETF (159131)—the CSI HK Connect Information Technology Composite Index—has gained over 24%, outperforming the Hang Seng Tech Index by 40% and the HK Connect Tech Index by 41% over the same period, and surpassing the HK Connect Internet Index by more than 58%, demonstrating significantly sharper and more elastic performance.
Statistical period: Dec 23, 2025 - Jun 23, 2026. The annual historical returns for the HK Connect Information Technology C Index from 2021 to 2025 were: -9.54%, -34.47%, -0.25%, 21.58%, 39.30% respectively. Past index performance does not indicate future results.
A Rare "Pure-Play" Hard Tech Vehicle for Hong Kong Stocks! Supports T+0 Trading!
The Huabao HK Connect Information Technology ETF (159131) is the first of its kind in the entire market, the largest, and most liquid ETF of its category. Its offshore feeder fund code is 026755. The underlying index is composed of "80% hardware + 20% software," heavily weighted towards Hong Kong-listed "semiconductors + electronics + computer software." It covers 60 Hong Kong-listed hard tech companies. The combined weight of the two major foundry giants, SMIC and Huahong Semiconductor, exceeds 21%. The weight of domestic AI PC leader Lenovo Group is 15.89%. The combined weight of PCB leaders Kingboard Holdings and Kingboard Laminates exceeds 10%. These three holdings represent the highest concentrations in any index with linked products across the entire market. Furthermore, the index recently added several new Hong Kong-listed hard tech giants like Zhipu AI and Biren Technology. The constituent stocks do not include large-cap internet companies like Alibaba, Tencent, or Meituan, resulting in higher sharpness and making it easier to capture the AI hard tech rally in Hong Kong stocks.
Data source: CSI Index Company, Shanghai and Shenzhen Stock Exchanges.
Note: "First in the entire market" refers to the Huabao HK Connect Information Technology ETF being the first ETF to track the CSI HK Connect Information Technology Composite Index. As of June 16, 2026, the latest on-exchange size of the Huabao HK Connect Information Technology ETF was 1.337 billion yuan, making it the largest among the 8 ETFs currently tracking the CSI HK Connect Information Technology Composite Index. The ETF's average daily turnover year-to-date is 565 million yuan. The annual historical returns of the underlying index, the CSI HK Connect Information Technology Composite Index (HKD), from 2021 to 2025 were: -9.54%, -34.47%, -0.25%, 21.58%, 39.30% respectively. Past index performance does not indicate future results.
Fund Fee Information: Subscription and redemption agents for the Huabao HK Connect Information Technology ETF may charge a commission of up to 0.5%. On-exchange trading fees are subject to the actual charges by securities firms. No sales service fee is charged.
Risk Disclosure: The Huabao HK Connect Information Technology ETF and its feeder fund passively track the CSI HK Connect Information Technology Composite Index. The base date of this index is November 14, 2014, and its release date is June 23, 2017. The index constituents mentioned in the material are for illustrative purposes only. Descriptions of individual stocks do not constitute any form of investment advice and do not represent the holdings or trading动向 of any fund managed by the fund manager. This product is issued and managed by Huabao Fund. Distributors do not bear responsibility for the investment performance or redemption of the product. Investors should carefully read the Fund Contract, Prospectus, Fund Product Key Facts Statement, and other legal fund documents to understand the fund's risk-return characteristics and choose products suitable for their own risk tolerance. Past fund performance does not predict future results. The performance of other funds managed by the fund manager does not guarantee the performance of this fund. Fund investment involves risks! The fund manager assesses this fund's risk等级 as R4 - Medium to High Risk, suitable for Aggressive (C4) and above investors. Distributors (including the fund manager's direct sales channels and other distributors) evaluate this fund's risk according to relevant laws and regulations. Investors should promptly pay attention to the suitability opinions issued by distributors and base their decisions on the matching results. Suitability opinions from different distributors may not necessarily be consistent, and a distributor's fund product risk等级 evaluation result shall not be lower than the risk等级 evaluation result made by the fund manager. The description of the fund's risk-return characteristics in the Fund Contract and its risk等级 may differ due to different considerations. Investors should understand the fund's risk-return profile and choose fund products cautiously based on their own investment objectives, horizon, experience, and risk tolerance, bearing the risks themselves. The China Securities Regulatory Commission's registration of this fund does not indicate a substantive judgment or guarantee of its investment value, market prospects, or returns. Funds carry risks; investment requires caution.
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