00179 Overview

Market Performance: The Hang Seng Index (HSI) rose by 249 points (0.9%) to close at 26,630, with a total market turnover of $288.42 billion.

Active Heavyweights: Notable stock movements included TENCENT (+1.2%), MEITUAN (+0.9%), and HKEX (+0.9%), while XIAOMI (-0.8%) and BABA (-0.1%) saw declines.

Top Gainers: SHK PPT surged by 7.1% to a new high, followed by WUXI BIO (+5.1%) and CHINA SHENHUA (+4.0%), indicating strong performance among HSI and HSCEI constituents.

Significant Movements: Johnson Electric experienced a remarkable increase of 17.4%, while HAO TIAN INTL fell by 10.9%, highlighting volatility in smaller stocks.

Citi's Research Report: Citi has initiated coverage on KB LAMINATES (01888.HK) with an Overweight rating and JOHNSON ELEC H (00179.HK) with a Neutral rating, reflecting the differing impacts of rising copper prices on their earnings.

Copper Price Surge: Copper prices increased by 22% year-over-year and 14% quarter-over-quarter in 4Q25, significantly affecting the earnings outlook for both companies.

KB LAMINATES' Earnings Growth: As the largest copper-clad laminate manufacturer, KB LAMINATES is expected to pass on rising costs to downstream PCB, enhancing its earnings growth.

Challenges for JOHNSON ELEC H: In contrast, JOHNSON ELEC H, the leading automotive micro-motor manufacturer, faces pressure on its earnings due to weaker bargaining power amid rising copper costs.

Market Performance: The HSI rose 0.33% to 26,718, with total half-day turnover reaching $127.938 billion, while the HSCEI and HSTECH also saw slight increases.

BABA-W Support: Alibaba's share price increased by 2.6% after rumors of supporting its chip subsidiary's separate listing, coinciding with the acceptance of Enflame's IPO application.

Sector Movements: Chip stocks experienced declines, with notable drops in SMIC and HUA HONG SEMI, while financials showed mixed results, with HSBC sliding slightly and HKEX gaining.

Stock Highlights: BYD and robotics stocks like JOHNSON ELEC faced losses, while XIAOMI surged 2.5% following a share buyback announcement, and POP MART's new product launch boosted its shares by 6.5%.

Company Performance: JOHNSON ELEC H reported slightly weaker-than-expected results for 3QFY26, leading to a decline in stock price by 7.045%.

Earnings Forecast Adjustment: Due to rising copper costs, Citi has reduced its earnings forecasts for JOHNSON ELEC H for FY26-28 by approximately 5%.

Target Price Revision: Citi has lowered its target price for JOHNSON ELEC H from HKD33 to HKD32 while maintaining a Neutral rating.

Market Sentiment: The company is expected to face short-term pressure due to disappointing results, with limited visibility for future performance.

Hong Kong Stock Market Performance: Hong Kong stock futures rose on settlement date, with the HSI increasing by 219 points (0.9%) to close at 25,854, while the HSCEI and HSTECH also saw gains of 1.1% and 1.7%, respectively, with total market turnover reaching $199.769 billion.

IPO Activity: ILUVATAR COREX (09903.HK) launched its IPO aiming to raise approximately $3.677 billion, indicating a strong interest in the market.

Chip Stocks Surge: BIDU-SW (09888.HK) and SMIC (00981.HK) experienced significant stock price increases of 8.9% and 4.2%, respectively, driven by market anticipation around new chip technologies and acquisitions.

Robotics Sector Growth: JD's partnership with Unitree Robotics led to a rise in robotics stocks, with INNOSCIENCE (02577.HK) and SANHUA (02050.HK) seeing substantial gains of 15.4% and 12.5%, respectively, reflecting growing investor interest in the sector.

Hong Kong Stock Market Performance: On the futures settlement day, the HSI rose by 267 points (1.05%) to 25,902, with a turnover of HKD139.669 billion.

Dobot's IPO Announcement: DOBOT's shares surged by 15.93% to HKD39.3 after announcing plans for an IPO of RMB ordinary shares and a listing on the Shenzhen Stock Exchange.

UBTECH Robotics Developments: UBTECH's stock increased by 9.37% to HKD130.7, with the CEO pledging not to sell his shares for 12 months and the company acquiring a 43% stake in FENGLONG for RMB1.665 billion.

Other Notable Stocks: SANHUA, JOHNSON ELEC, and FORTIOR also saw significant gains, with SANHUA up 12.59%, JOHNSON ELEC up 5.53%, and FORTIOR up 4.88%.