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

<ul><li>VSTECS announced 1H25 results: total revenue increased by 14% YoY to HK$45.5bn, representing 44% of our FY25E estimate; net profit was up by 36% YoY to HK$649mn, equivalent to 49% of our FY25E estimate.</li><li>Strong demand for AI computing power drove strong revenue growth of cloud computing business (+68% YoY). As one of the leading distributors of AI chips and computing power in Asia, we expect VSTECS will continue to benefit from the growing demand for AI computing power.</li><li>We maintain our FY25-27E earnings forecast largely unchanged. We raise our target price to HK$14.2 based on 15x FY25E PE (previous: HK$7.60 based on 8x FY25E PE), mainly to reflect larger AI-related revenue exposure. Maintain BUY.</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.

VSTECS announced 1H25 results: total revenue increased by 14% YoY to HK$45.5bn, representing 44% of our FY25E estimate; net profit was up by 36% YoY to HK$649mn, equivalent to 49% of our FY25E estimate.Strong demand for AI computing power drove strong revenue growth of cloud computing business (+68% YoY). As one of the leading distributors of AI chips and computing power in Asia, we expect VSTECS will continue to benefit from the growing demand for AI computing power.We maintain our FY25-27E earnings forecast largely unchanged. We raise our target price to HK$14.2 based on 15x FY25E PE (previous: HK$7.60 based on 8x FY25E PE), mainly to reflect larger AI-related revenue exposure. Maintain BUY.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.

VSTECS (856 HK) - 1H25 Result Review: Strong Cloud Computing Revenue Growth on Robust AI Demand

<ul><li>VSTECS, founded in 1991, is one of the leading IT distributors and cloud service providers in Asia.</li><li>Supported by its solid market leadership, global footprint and diversified IT solution offerings, VSTECS is well-positioned to benefit from the booming demand for AI computing, IT localisation trend in China, and robust digitalisation demand in Southeast Asia, in our view.</li><li>VSTECS’ total revenue reached HK$73.9bn in 2023, with enterprise systems/consumer electronics/ cloud computing accounting for 55/41/4% of total revenue. </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.

VSTECS, founded in 1991, is one of the leading IT distributors and cloud service providers in Asia.Supported by its solid market leadership, global footprint and diversified IT solution offerings, VSTECS is well-positioned to benefit from the booming demand for AI computing, IT localisation trend in China, and robust digitalisation demand in Southeast Asia, in our view.VSTECS’ total revenue reached HK$73.9bn in 2023, with enterprise systems/consumer electronics/ cloud computing accounting for 55/41/4% of total revenue. 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.

VSTECS (856 HK) - Leading IT Distributor in Asia Riding on Tailwinds of AI & Overseas Expansion

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

<ul>
<li>The December rebalance of the Hang Seng family of indices will use today's closing prices to cap the index constituent weights.</li>
<li>The net round-trip trade across all stocks across the five indices is estimated at HK$50bn (US$6.4bn). There is size to trade in a lot of stocks.</li>
<li>
<a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi (1810 HK)</a> is the biggest buy due to HSIII Index inclusion and capping, while <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba (9988 HK)</a> is the biggest capping sell.</li>
</ul>


The December rebalance of the Hang Seng family of indices will use today's closing prices to cap the index constituent weights.
The net round-trip trade across all stocks across the five indices is estimated at HK$50bn (US$6.4bn). There is size to trade in a lot of stocks.

Xiaomi (1810 HK) is the biggest buy due to HSIII Index inclusion and capping, while Alibaba (9988 HK) is the biggest capping sell.


HSI, HSCEI, HSTECH, HSIII, HSBIO Index Rebalance: US$6.4bn of Flows Post Capping (Dec 2025)

<ul>
<li>Following the methodology update for the HSIII Index, there could be up to 5 constituent changes in December.</li>
<li>Estimated one-way turnover is 12.8% and that will result in a round-trip trade of HK$9.8bn (US$1.25bn).</li>
<li>
<a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi (1810 HK)</a> is the biggest beneficiary of the new methodology while there will be large funding outflows for a lot of the current index constituents.</li>
</ul>


Following the methodology update for the HSIII Index, there could be up to 5 constituent changes in December.
Estimated one-way turnover is 12.8% and that will result in a round-trip trade of HK$9.8bn (US$1.25bn).

Xiaomi (1810 HK) is the biggest beneficiary of the new methodology while there will be large funding outflows for a lot of the current index constituents.


Hang Seng Internet & IT Index (HSIII) Rebalance Preview: Methodology Change Leads to US$1.25bn Trade

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

<ul>
<li>The Hang Seng Internet &amp; IT (HSIII) index represents the top 30 stocks related to internet and information technology businesses listed in Hong Kong (HKEX).</li>
<li>In this insight, we take a look at the impact of the new selection methodology for the December 2025 and March 2026 rebal/review events.</li>
<li>We have also presented our index change expectations for the next semiannual index review which will take place in March 2026 (regular ADDs/DELs only take place in March and September).</li>
</ul>


The Hang Seng Internet &amp; IT (HSIII) index represents the top 30 stocks related to internet and information technology businesses listed in Hong Kong (HKEX).
In this insight, we take a look at the impact of the new selection methodology for the December 2025 and March 2026 rebal/review events.
We have also presented our index change expectations for the next semiannual index review which will take place in March 2026 (regular ADDs/DELs only take place in March and September).


Quiddity Leaderboard HSIII Dec25/Mar26: Interesting Implications of the Recent Methodology Changes

Hong Kong

VST Holdings Limited distributes a wide range of IT products, including data storage device, CPUs, media products, PC motherboards, and server motherboards. The Company also provides value-added services to its suppliers as well as support and after-sale service to its customers.

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Vst Holdings (856 HK)

VSTECS (856 HK) - 1H25 Result Review: Strong Cloud Computing Revenue Growth on Robust AI Demand

We maintain our FY25-27E earnings forecast largely unchanged. We raise our target price to HK$14.2 based on 15x FY25E PE (previous: HK$7.60 based...

CMB International

VSTECS (856 HK) - Leading IT Distributor in Asia Riding on Tailwinds of AI & Overseas Expansion

VSTECS’ total revenue reached HK$73.9bn in 2023, with enterprise systems/consumer electronics/ cloud computing accounting for 55/41/4% of total...

CMB International

HSI, HSCEI, HSTECH, HSIII, HSBIO Index Rebalance: US$6.4bn of Flows Post Capping (Dec 2025)

The Dec rebalance of the HSI, HSCEI, HSTECH, HSIII, HSHKBIO indices will use today's closing prices for capping. The round-trip trade across the...

Brian Freitas

Hang Seng Internet & IT Index (HSIII) Rebalance Preview: Methodology Change Leads to US$1.25bn Trade

The methodology update could result in 5 changes in Dec. Estimated one-way turnover is 12.8% resulting in a round-trip trade of US$1.25bn. There...

Brian Freitas

Quiddity Leaderboard HSIII Dec25/Mar26: Interesting Implications of the Recent Methodology Changes

The recent methodology update could result in unusual index changes during the December 2025 index rebal event. There could be more in March 2026 too.

Janaghan Jeyakumar, CFA

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