The Hang Seng Indexes Company conducted its quarterly index review on Friday, with Knowledge Atlas and MiniMax considered top candidates for inclusion in the Hang Seng Tech Index. If approved, this would trigger eligibility for Southbound Stock Connect and potentially attract tens of billions in Hong Kong dollars of Southbound capital inflows, leading to significant intraday price increases for both stocks on Friday.
Analysts noted that Knowledge Atlas and MiniMax, each having accumulated gains exceeding 300% since their listings in January this year, are leading contenders for addition to the Hang Seng Tech and Composite Indexes in this review, with their substantial recent market capitalization growth being a primary factor. During Friday's session, Knowledge Atlas shares surged by up to 29%, while MiniMax rose as much as 14%.
Knowledge Atlas could qualify for Southbound Stock Connect as early as June 8 under fast-inclusion rules, while MiniMax, which has a weighted voting rights (WVR) structure, is expected to gain access to Southbound trading earliest by August. According to Bloomberg Intelligence estimates, Knowledge Atlas could attract between HKD 51 billion and HKD 92 billion in Southbound buying, with MiniMax potentially drawing up to HKD 47 billion. Combined, the two are projected to account for approximately 9% of the Hang Seng Tech Index weight. However, a significant variable is the upcoming share lock-up expiration in July: at that time, about 65% of MiniMax's total share capital will become available for trading, while Knowledge Atlas will have roughly 6% of its shares unlocked. The valuation premium supported by their currently extremely low free float will face its first major test.
Index Inclusion Expectations Drive Sharp Stock Rises
A Bloomberg report cited analyst views stating that Knowledge Atlas and MiniMax have approached the inclusion threshold following rapid market cap expansion, and with the Hang Seng Indexes Company's quarterly review held on Friday, both stocks rallied during the session. Since their listings in January this year, both stocks have gained over 300%, ranking them first and second among 2026 Hong Kong IPO gainers.
Bloomberg Intelligence analyst Jason Liao pointed out that pure-play AI large model stocks are extremely scarce in the A-share market, suggesting Southbound demand could provide sustained support for both stocks. He noted that mainland investors typically hold between 11% to 20% of the shares in major Hong Kong tech companies via Stock Connect, and Knowledge Atlas and MiniMax could attract capital on a similar scale. Smartkarma analyst Brian Freitas also stated that inclusion in the Hang Seng Tech Index would pave the way for both companies to join other global and local indices. As their free float gradually expands, it would bring further opportunities for index inclusion and capital inflows. If successfully included in the Hang Seng Tech Index, Knowledge Atlas could qualify for Southbound Stock Connect as early as June 8 under fast-inclusion rules. MiniMax, due to its weighted voting rights (WVR) structure, must meet additional compliance conditions—including a minimum listing period and thresholds for average daily market capitalization and total turnover—and is expected to gain Southbound access earliest by August.
Southbound Capital: Potential Inflows in the Tens of Billions
Estimates indicate the potential scale of Southbound capital is substantial. Bloomberg Intelligence estimates that Knowledge Atlas could attract HKD 51 billion to HKD 92 billion in net Southbound buying after inclusion, while MiniMax could see up to HKD 47 billion in inflows. Jason Liao noted that historically, mainland investors have typically held 11% to 20% of shares in major Hong Kong-listed tech companies, and the ownership levels for these two firms might be similar. Furthermore, Bloomberg estimates that ETFs and passive products tracking the Hang Seng Tech Index have approximately USD 4 billion in assets under management. The Bloomberg report indicated that capital inflows from mainland investors, combined with ETF purchases, could help offset selling pressure ahead of the July lock-up expiration. If the two companies secure a combined index weight of around 9%, passive products tracking the relevant indices would be forced to make corresponding positional buys. According to HSBC Holdings Plc estimates, currently only about 5% of MiniMax's total share capital is freely tradable, with approximately 65% of total shares entering the market in July. Knowledge Atlas will have about 6% of its shares unlocked in July, with another roughly 40% becoming available at the end of January next year. Brian Freitas stated, "The first lock-up expiry in July will significantly increase the free float," adding that "the January expiry will bring more opportunities for index inclusion and capital inflows." From a financial fundamentals perspective, both companies are in a phase of high R&D investment and low commercial monetization. Knowledge Atlas reported revenue of RMB 191 million for the first half of 2025, with R&D expenses reaching RMB 1.594 billion during the same period. MiniMax reported revenue of USD 53.44 million for the first nine months of 2025, with R&D expenses of USD 180 million. Following the lock-up expiration, the market's pricing logic for these companies may shift from a liquidity scarcity premium to fundamental indicators such as revenue growth rate and the pace of loss reduction.
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