On August 28 in the Hong Kong stock market, southbound funds recorded net sales of HK$20.441 billion, with Shanghai-Hong Kong Stock Connect posting net sales of HK$13.297 billion and Shenzhen-Hong Kong Stock Connect recording net sales of HK$7.144 billion.
The stocks with the highest net inflows from southbound funds were SMIC (00981), CStone Pharmaceuticals (09926), and Hua Hong Semiconductor (01347). The stocks with the largest net outflows were Tracker Fund of Hong Kong (02800), Hang Seng China Enterprises Index ETF (02828), and Tencent (00700).
Southbound funds resumed accumulating chip stocks. SMIC (00981) and Hua Hong Semiconductor (01347) received net inflows of HK$892 million and HK$463 million respectively. On the news front, TrendForce predicts that the proportion of foreign-sourced chips from companies like NVIDIA and AMD in China's AI server market will decline from 63% in 2024 to 42% in 2025, while domestic chip suppliers' share is expected to rise to 40%, indicating that domestic substitution has become a major trend. Previously on August 21, DeepSeek released the DeepSeek-V3.1 large model, which uses UE8M0 FP8 Scale parameter precision, designed for next-generation domestic chips.
CStone Pharmaceuticals (09926) received net inflows of HK$511 million. On the news front, CStone Pharmaceuticals' ivonescimab for treating EGFR-TKI resistant EGFRm nsq-NSCLC in the China Phase III HARMONi-A study showed final analysis results meeting the OS clinical endpoint. The overseas Phase III HARMONi study for the same indication has already published survival benefit improvements similar to HARMONi-A. Bank of Communications International noted that considering the larger sample size of the HARMONi study, the likelihood of achieving statistical significance in the final OS analysis is high, raising the overseas PoS-adjusted peak sales forecast to $16.5 billion.
China Life Insurance (02628) received net inflows of HK$383 million. On the news front, Founder Securities noted that China Life's first-half performance essentially met expectations. The company's NBV is gradually accelerating despite high base effects, with individual insurance channel dividend insurance proportion significantly increasing and robust growth in bancassurance business amid sales recovery. Meanwhile, the company's equity allocation ratio has increased and OCI improvements are expected to smooth bond allocation pressure, while TPL exposure can ensure the company gains equity elasticity, with subsequent profits and NBV expected to grow steadily as markets recover and residents shift savings.
Technology stocks showed divergence, with Meituan-W (03690) and Alibaba-W (09988) receiving net inflows of HK$333 million and HK$329 million respectively, while Tencent (00700) saw net outflows of HK$583 million. On the news front, Cathay Haitong pointed out that Hong Kong technology stocks benefiting from the AI cycle could be the main theme. Marginal easing in China-US economic and trade relations has boosted risk appetite, while relaxation of technology export controls has improved fundamental expectations. Considering current market over-concern about the "subsidy war" among internet food delivery platforms, there may be potential overselling. Hong Kong technology leaders are expected to regain relative advantages in the second half.
Horizon Robotics-W (09660) received net inflows of HK$241 million. On the news front, Horizon Robotics released interim results showing revenue of RMB 1.567 billion in the first half, up 67.6% year-on-year; gross profit reached RMB 1.024 billion with a comprehensive gross margin of 65.4%; cash reserves of RMB 16.1 billion. Horizon Robotics CEO Yu Kai stated at the interim results conference that the group maintained its leading position in the ADAS basic assisted driving market with a 45.8% market share in the first half, and continued to lead the domestic autonomous brand overall intelligent assisted driving computing solution market with a 32.4% market share.
XtalPi (02228) received net inflows of HK$224 million. On the news front, XtalPi released interim results showing revenue of RMB 517 million, up 403.83% year-on-year; profit attributable to shareholders of RMB 82.795 million compared to a loss of RMB 1.237 billion in the same period last year, achieving the group's first half-year profit. The improved financial performance was mainly due to the group's collaboration with DoveTree, where the group provided drug discovery solutions and services based on its end-to-end AI drug discovery platform and comprehensive "AI+robotics" technology, driving significant revenue growth.
Southbound funds continued dumping Hong Kong stock ETFs, with Tracker Fund of Hong Kong (02800) and Hang Seng China Enterprises Index ETF (02828) suffering net outflows of HK$11.886 billion and HK$4.776 billion respectively. On the news front, Huatai Securities previously released a Hong Kong stock strategy report stating that foreign investors still have room to continue increasing allocation to the Chinese market. However, it should be noted that the importance of foreign investors in the Hong Kong stock market has declined, with southbound funds' trading proportion in Stock Connect targets already exceeding 40%, making the sustainability of their future inflows equally or even more worthy of attention.
Additionally, CNOOC (00883) and Yangtze Optical Fibre and Cable Joint Stock Limited Company (06869) received net inflows of HK$253 million and HK$36.96 million respectively, while Xiaomi Corporation-W (01810) saw net outflows of HK$299 million.