On January 23rd, the Hong Kong stock market recorded a net sell-off of HK$1.601 billion by northbound capital. Specifically, the Shanghai-Hong Kong Stock Connect saw net sales of HK$560 million, while the Shenzhen-Hong Kong Stock Connect recorded net sales of HK$1.041 billion. The stocks receiving the most substantial net purchases from northbound capital were POP MART (09992), XIAOMI-W (01810), and TENCENT (00700). Conversely, the stocks facing the most significant net sales were BABA-W (09988), CHINA MOBILE (00941), and YOFC (06869). POP MART (09992) attracted net purchases totaling HK$747 million. The surge in interest follows the company's January 22nd release of its 2026 Valentine's Day limited-edition blind box series, "Starry Lovers: Starstruck." This plush keychain collection, marking the Starry character's first Valentine's series, sold out rapidly upon launch. Additionally, POP MART's recent PUCKY Knock-Knock series blind boxes have gained significant popularity beyond their core fanbase, and the New Year's Full Throttle series of plush toys have also been highly sought after. Notably, the company has recently conducted consecutive share repurchases, spending over HK$300 million on buybacks on January 19th and January 21st, demonstrating confidence in its medium to long-term growth prospects. XIAOMI-W (01810) received net inflows of HK$608 million. This follows an announcement on January 22nd where XIAOMI GROUP disclosed its intention to repurchase up to HK$2.5 billion of its Class B ordinary shares. The repurchase program is set to commence on January 23rd and will continue until the day before the 2026 Annual General Meeting, or until the total repurchase amount reaches HK$2.5 billion, or the agreement is terminated earlier, whichever occurs first. XIAOMI GROUP believes that implementing the automatic share repurchase plan showcases the company's confidence in its business outlook and aligns with the overall best interests of the company and its shareholders. Shares repurchased under this plan will subsequently be cancelled. TENCENT (00700) garnered net purchases of HK$240 million. In related news, J.P. Morgan released a research report stating that TENCENT's core engines—its WeChat ecosystem, advertising, and gaming businesses—remain resilient. The report further suggested that the impact of artificial intelligence on the stock's price trajectory is expected to outweigh the influence of rising profit expectations. Compared to its peers, TENCENT's generative AI deployment is still in an earlier stage regarding model demonstration and standalone application momentum, as management prioritizes reliability, compliance, and ecosystem integration over rapid scaling. This positioning means the stock has not been overly inflated with an "AI premium," potentially creating upside value if the company can demonstrate clear execution and product-market fit this year. The commercial aerospace sector saw mixed movements, with Junda (02865) receiving net purchases of HK$52.3628 million, while Goldwind (02208) faced net sales of HK$123 million. Recent comments from Elon Musk have ignited interest in the space-based solar industry chain. Reports indicate that Musk stated SpaceX and Tesla are concurrently advancing efforts to increase solar energy capacity, targeting an annual solar manufacturing capability of 100 GW within the next three years. In late December last year, Junda formally signed a strategic cooperation agreement with Shangyi Optoelectronics. Junda will make an equity investment in Shangyi as a strategic shareholder, with both parties collaborating on the application of perovskite battery technology in space energy. Previously, the company disclosed plans to invest 30 million yuan in cash for a 16.67% stake in Shanghai Xingyi Xinneng, becoming its second-largest shareholder. The two entities will establish a joint venture focusing on CPI films and products combining CPI films with crystalline silicon batteries, aiming to enter the low-earth orbit and space-based photovoltaic markets. CNOOC (00883) again attracted net purchases, amounting to HK$32.6877 million. This comes as the International Energy Agency (IEA), in its closely watched monthly report, raised its forecast for global oil demand growth, citing an improved global economic outlook and lower crude oil prices. However, the IEA also cautioned that the market will still face a supply surplus in the coming period, which is substantial enough to offset potential disruptions caused by geopolitical risks. The IEA now expects global oil demand to increase by 930,000 barrels per day this year, up from a previous estimate of 860,000 barrels per day. BABA-W (09988) experienced significant net selling, amounting to HK$1.49 billion. According to media reports citing informed sources, Alibaba is preparing to advance the independent listing of its AI chip manufacturing unit, T-Head. Alibaba plans to restructure it into a business entity partially owned by employees before seeking an initial public offering (IPO), although a specific timeline has not been set, and the move is still in preparatory stages. T-Head, established by Alibaba in 2018, is a semiconductor chip company formed by integrating Zhongtian Microsystems, which Alibaba acquired, with its internal chip team from the Damo Academy. It primarily focuses on AI chips and RISC-V ecosystem technology. Laopu Gold (06181), whose share price hit a new high since last October today, saw net sales of HK$66.8667 million. A Daiwa research report noted that, based on a recent call with management, the company reiterated its target of achieving a 40% gross margin this year, even though Daiwa expects margins to decline sequentially in the second half of 2025. Daiwa stated that assuming gold prices rise linearly by another 10% from their year-to-date increase of 12% by the end of 2026, and the company commits to maintaining a gross margin above 40%, it estimates Laopu Gold would need to increase its selling price per gram of gold by over 35% this year. This is considered far above current investor expectations and, if gold prices remain strong, implies significant upside risk to this year's forecasted revenue. In other movements, SMIC (00981) received net purchases of HK$25.7139 million, while CHINA MOBILE (00941) and YOFC (06869) faced net sales of HK$622 million and HK$138 million, respectively. China Life (02628) saw net sales of HK$5.8174 million.
Comments