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.

Equity Bottom-Up

InnoScience Suzhou Technology / Equity Bottom-Up

<ul><li>InnoScience’s 1H26 results missed Bloomberg consensus, with revenue rising 50.6% YoY to RMB834mn.</li><li>GPM improved to 11.6% from 6.8%/7.7% in 1H/2H25, driven by higher utilization, product upgrades and a richer mix, while operating cash flow turned positive.</li><li>Higher-value applications generated revenue of RMB532mn, up 70% YoY, lifting contribution to 64% from c.57% in 1H25. </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.

InnoScience’s 1H26 results missed Bloomberg consensus, with revenue rising 50.6% YoY to RMB834mn.GPM improved to 11.6% from 6.8%/7.7% in 1H/2H25, driven by higher utilization, product upgrades and a richer mix, while operating cash flow turned positive.Higher-value applications generated revenue of RMB532mn, up 70% YoY, lifting contribution to 64% from c.57% in 1H25. 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.

InnoScience (2577 HK) - 1H26 takes a breather as mix and margins improved

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

Contemporary Amperex Technology / Index Rebalance

Contemporary Amperex Technology (3750 HK)

<ul>
<li>On 10 August, Hang Seng Index launched a market consultation on potential changes to the <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">Hang Seng TECH Index (HSTECH INDEX)</a> methodology.</li>
<li>If the proposals are approved, there will be 20 stocks added to the index in December creating a lot of flow and impact for the index constituents.</li>
<li>One way turnover is estimated at 13.4% leading to a round-trip trade of HK$73.3bn (US$9.3bn), so this could be implemented in a phased manner.</li>
</ul>


On 10 August, Hang Seng Index launched a market consultation on potential changes to the Hang Seng TECH Index (HSTECH INDEX) methodology.
If the proposals are approved, there will be 20 stocks added to the index in December creating a lot of flow and impact for the index constituents.
One way turnover is estimated at 13.4% leading to a round-trip trade of HK$73.3bn (US$9.3bn), so this could be implemented in a phased manner.


HSTECH Index: Market Consultation, 20 Adds in December, Trade of US$9.3bn

<ul>
<li>On 7 October, Hang Seng announced the conclusions of the market consultation to increase the number of <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">Hang Seng TECH Index (HSTECH INDEX)</a> constituents from 30 to 50.</li>
<li>While most of the proposals will be implemented as proposed, a liquidity requirement has been tightened, and revenue thresholds have been imposed for companies qualifying through the Sales Growth Stream.</li>
<li>The changes will be implemented in a single step at the December rebalance and that creates a lot of flow for all the index members, current and new.</li>
</ul>


On 7 October, Hang Seng announced the conclusions of the market consultation to increase the number of Hang Seng TECH Index (HSTECH INDEX) constituents from 30 to 50.
While most of the proposals will be implemented as proposed, a liquidity requirement has been tightened, and revenue thresholds have been imposed for companies qualifying through the Sales Growth Stream.
The changes will be implemented in a single step at the December rebalance and that creates a lot of flow for all the index members, current and new.


HSTECH Index: Market Consultation Conclusions, Updated Potential Adds & The Borderline Names

Smartkarma AI Primers, Smartkarma

αSK Primers

Smartkarma AI Primers

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

<ul>
 <li>InnoScience is the world's largest Integrated Device Manufacturer (IDM) focused on Gallium Nitride (GaN) technology, holding a leading market share of 33.7% in 2023. The company's integrated model, covering design to manufacturing, provides a significant competitive advantage in the rapidly growing GaN power semiconductor market.</li>
 <li>The company is strategically positioned to capitalize on the surging demand for GaN-based solutions in high-growth sectors such as AI data centers, electric vehicles (EVs), and consumer electronics, driven by the superior efficiency and performance of GaN technology over traditional silicon.</li>
 <li>Despite its market leadership and strong growth prospects, InnoScience faces risks associated with intensifying competition, potential overcapacity in the GaN market, and ongoing patent litigation, which could impact future profitability and market share.</li>
</ul>This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.


  InnoScience is the world's largest Integrated Device Manufacturer (IDM) focused on Gallium Nitride (GaN) technology, holding a leading market share of 33.7% in 2023. The company's integrated model, covering design to manufacturing, provides a significant competitive advantage in the rapidly growing GaN power semiconductor market.
  The company is strategically positioned to capitalize on the surging demand for GaN-based solutions in high-growth sectors such as AI data centers, electric vehicles (EVs), and consumer electronics, driven by the superior efficiency and performance of GaN technology over traditional silicon.
  Despite its market leadership and strong growth prospects, InnoScience faces risks associated with intensifying competition, potential overcapacity in the GaN market, and ongoing patent litigation, which could impact future profitability and market share.
This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.

Primer: InnoScience Suzhou Technology (2577 HK) - Apr 2026

Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

<ul>
<li>The HSTECH Index tracks the performance of the top technology companies listed in Hong Kong that have high business exposure to certain technology themes.</li>
<li>The market consultation results have been announced. All proposed changes will be adopted in full with two additional requirements to avoid low-liquidity and low-revenue names.</li>
<li>We expect 20 ADDs and no DELs in December 2026. We estimate one-way flow of around US$4bn with 11 expected ADDs having more than 3x ADV to buy.</li>
</ul>


The HSTECH Index tracks the performance of the top technology companies listed in Hong Kong that have high business exposure to certain technology themes.
The market consultation results have been announced. All proposed changes will be adopted in full with two additional requirements to avoid low-liquidity and low-revenue names.
We expect 20 ADDs and no DELs in December 2026. We estimate one-way flow of around US$4bn with 11 expected ADDs having more than 3x ADV to buy.


Quiddity Leaderboard HSTECH Dec26: New Rules Confirmed with Some Modifications; Latest Expectations

Hong Kong

Innoscience is the largest 8-inch Integrated Device Manufacture (IDM) fully focused on GaN technology in the world.

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InnoScience Suzhou Technology (2577 HK)

InnoScience (2577 HK) - 1H26 takes a breather as mix and margins improved

GPM improved to 11.6% from 6.8%/7.7% in 1H/2H25, driven by higher utilization, product upgrades and a richer mix, while operating cash flow turned...

CMB International

HSTECH Index: Market Consultation, 20 Adds in December, Trade of US$9.3bn

Following a market consult, there could be 20 adds for the index in Dec leading to a one-way turnover of 13.4% and a round-trip trade of US$9.3bn....

Brian Freitas

HSTECH Index: Market Consultation Conclusions, Updated Potential Adds & The Borderline Names

Introduction/tightening of revenue/liquidity criteria changes the list of potential adds. Estimated one-way turnover at the Dec rebalance is 14.2%...

Brian Freitas

Primer: InnoScience Suzhou Technology (2577 HK) - Apr 2026

InnoScience is the world's largest Integrated Device Manufacturer (IDM) focused on Gallium Nitride (GaN) technology, holding a leading market...

αSK Primers

Quiddity Leaderboard HSTECH Dec26: New Rules Confirmed with Some Modifications; Latest Expectations

There could be more than 5x ADV to buy for the top 5 expected ADDs. Many other names have more than 1x ADV to trade. The flow expectations can...

Janaghan Jeyakumar, CFA

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