External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Thematic (Sector/Industry)

<ul><li>Alibaba released its 3QFY25 earnings (see our internet team report) with a significant step-up in capex plan for the next three years, the total of which is expected to surpass the company’s cumulative capex of the past decade, per mgmt., reaching as high as ~RMB120bn per year during CY2026-28E, according to our calculation.</li><li>We believe cloud service providers (CSPs) in China are trying to pick up the pace in capex in compute infrastructure to keep up with the relentless investment strides of overseas CSPs (Amazon, Meta, Microsoft, and Google).</li><li>We believe the ripple effects of Alibaba’s increased capex plan will benefit domestic AI infrastructure supply chain names, such as Innolight (300308 CH, BUY, TP: RMB186) and Shengyi Tech (600183 CH, BUY, TP: RMB34.5), which supply critical components (e.g., high-speed optical transceivers, ultra-low-loss CCL) for datacenter buildout.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Alibaba released its 3QFY25 earnings (see our internet team report) with a significant step-up in capex plan for the next three years, the total of which is expected to surpass the company’s cumulative capex of the past decade, per mgmt., reaching as high as ~RMB120bn per year during CY2026-28E, according to our calculation.We believe cloud service providers (CSPs) in China are trying to pick up the pace in capex in compute infrastructure to keep up with the relentless investment strides of overseas CSPs (Amazon, Meta, Microsoft, and Google).We believe the ripple effects of Alibaba’s increased capex plan will benefit domestic AI infrastructure supply chain names, such as Innolight (300308 CH, BUY, TP: RMB186) and Shengyi Tech (600183 CH, BUY, TP: RMB34.5), which supply critical components (e.g., high-speed optical transceivers, ultra-low-loss CCL) for datacenter buildout.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Semiconductors - Thematic Investing and Megatrends

<ul><li>After two years of significant investments in AI infrastructure, investors are counting 2025 to be a transformational year for AI.</li><li>As market leaders will continue to deploy a large amount of capital in AI infrastructure buildout to widen their competitive moats, new themes in the downstream are rising, including AI agents, humanoid robots, robotaxi, etc.</li><li>We remain bullish on AI demand. We continue to rank AI theme as our top pick for 2025. Market leaders will continue to enjoy the AI tailwind beyond 2025.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

After two years of significant investments in AI infrastructure, investors are counting 2025 to be a transformational year for AI.As market leaders will continue to deploy a large amount of capital in AI infrastructure buildout to widen their competitive moats, new themes in the downstream are rising, including AI agents, humanoid robots, robotaxi, etc.We remain bullish on AI demand. We continue to rank AI theme as our top pick for 2025. Market leaders will continue to enjoy the AI tailwind beyond 2025.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Semiconductors -Stargate Poised to Accelerate Global AI Arms Race

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

Sieyuan Electric Co Ltd A / Index Rebalance

<ul>
<li>There are 16 changes for the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-index" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI 300 Index</a>, 50 changes for the <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI 500 Index</a> and 100 changes for the CSI1000 Index that will be implemented on 13 December.</li>
<li>There are 257 unique names that are adds or deletes and the round-trip trade across all 3 indices is close to US$9bn.</li>
<li>Stocks with the largest inflows and impact have outperformed stocks with the largest outflows and impact over the last few weeks. That could continue for the next couple of weeks.</li>
</ul>


There are 16 changes for the CSI 300 Index, 50 changes for the CSI 500 Index and 100 changes for the CSI1000 Index that will be implemented on 13 December.
There are 257 unique names that are adds or deletes and the round-trip trade across all 3 indices is close to US$9bn.
Stocks with the largest inflows and impact have outperformed stocks with the largest outflows and impact over the last few weeks. That could continue for the next couple of weeks.


CSI300/CSI500/CSI1000 Index Rebalance: US$9bn Round-Trip Trade

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Sichuan Biokin Pharmaceutical / Index Rebalance

<ul>
<li>The December 2024 index review results for China's CSI 300 and CSI 500 indices were announced after market close on Friday 29th November 2024.</li>
<li>There will be 16 ADDs/DELs for CSI 300 and 50 ADDs/DELs for CSI 500.</li>
<li>The CSI 300 and CSI 500 index rebal events could trigger US$4.5bn and US$3.8bn in one-way flows respectively.</li>
</ul>


The December 2024 index review results for China's CSI 300 and CSI 500 indices were announced after market close on Friday 29th November 2024.
There will be 16 ADDs/DELs for CSI 300 and 50 ADDs/DELs for CSI 500.
The CSI 300 and CSI 500 index rebal events could trigger US$4.5bn and US$3.8bn in one-way flows respectively.


Quiddity CSI 300/​​500 Dec 24 Results: ~90% Hit Rate; Positive Start for the Trade

<ul>
<li>There could be 17 changes at the December rebalance with the Industrials and Materials sectors could gaining 2 spots each and the Information Technology sector losing 3 spots.</li>
<li>Estimated one-way turnover of 3% at the December rebalance leading to a one-way trade of CNY 30.2bn (US$4.3bn). There are 14 stocks with over 2x ADV to trade.</li>
<li>The forecast adds have outperformed the forecast deletes over the last month despite rising markets and a wall of money flowing into <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-index" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX)</a> ETFs.</li>
</ul>


There could be 17 changes at the December rebalance with the Industrials and Materials sectors could gaining 2 spots each and the Information Technology sector losing 3 spots.
Estimated one-way turnover of 3% at the December rebalance leading to a one-way trade of CNY 30.2bn (US$4.3bn). There are 14 stocks with over 2x ADV to trade.
The forecast adds have outperformed the forecast deletes over the last month despite rising markets and a wall of money flowing into Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX) ETFs.


CSI300 Index Rebalance Preview: Rising Markets and ETF Creations Take Round-Trip Trade to US$8.5bn

China

Eoptolink Technology Inc., Ltd.  designs and manufactures communication components.  The Company sells a variety of optical transceiver modules.  Eoptolink Technology sells products around the world.

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Eoptolink Technology (300502 CH)

Semiconductors - Thematic Investing and Megatrends

We believe cloud service providers (CSPs) in China are trying to pick up the pace in capex in compute infrastructure to keep up with the relentless...

CMB International

Semiconductors -Stargate Poised to Accelerate Global AI Arms Race

We remain bullish on AI demand. We continue to rank AI theme as our top pick for 2025. Market leaders will continue to enjoy the AI tailwind beyond...

CMB International

CSI300/CSI500/CSI1000 Index Rebalance: US$9bn Round-Trip Trade

The CSI indices (and a bunch of others) rebalance at the close today - it's going to be a big volume day in China. The CSI300 adds have...

Brian Freitas

Quiddity CSI 300/500 Dec 24 Results: ~90% Hit Rate; Positive Start for the Trade

The LONGs have outperformed the Index by 2.2% since 5th November. The trade has to be now adjusted for the surprises in the latest index change...

Janaghan Jeyakumar, CFA

CSI300 Index Rebalance Preview: Rising Markets and ETF Creations Take Round-Trip Trade to US$8.5bn

There could be 17 changes in Dec. Estimated 1-way turnover is 3%; 1-way trade is US$4.3bn. There are 14 stocks with over 2x ADV to trade. The adds...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Semiconductors - Thematic Investing and Megatrends

We believe cloud service providers (CSPs) in China are trying to pick up the pace in capex in compute infrastructure to keep up with the relentless...

CMB International

Semiconductors -Stargate Poised to Accelerate Global AI Arms Race

We remain bullish on AI demand. We continue to rank AI theme as our top pick for 2025. Market leaders will continue to enjoy the AI tailwind beyond...

CMB International

CSI300/CSI500/CSI1000 Index Rebalance: US$9bn Round-Trip Trade

The CSI indices (and a bunch of others) rebalance at the close today - it's going to be a big volume day in China. The CSI300 adds have...

Brian Freitas

Quiddity CSI 300/​​500 Dec 24 Results: ~90% Hit Rate; Positive Start for the Trade

The LONGs have outperformed the Index by 2.2% since 5th November. The trade has to be now adjusted for the surprises in the latest index change...

Janaghan Jeyakumar, CFA

CSI300 Index Rebalance Preview: Rising Markets and ETF Creations Take Round-Trip Trade to US$8.5bn

There could be 17 changes in Dec. Estimated 1-way turnover is 3%; 1-way trade is US$4.3bn. There are 14 stocks with over 2x ADV to trade. The adds...

Brian Freitas

Quiddity CSI 300/500 Dec 24 Results: ~90% Hit Rate; Positive Start for the Trade