Daily Brief China: Alibaba, Manycore Tech, Hua Hong Semiconductor, Iluvatar CoreX, Sigenergy Technology, Zhuhai Kingsware Artificial Intelligence, Eaglerise Electric & Electronic (CHINA), SSI New Material (Zhenjiang) and more

• Alibaba (9988 HK) / Alibaba (BABA US) has announced a placement of HK$80bn (US$10.2bn) to invest in its full stack AI capabilities and to expand and enhance its AI infrastructure.
• The shares are being offered at HK$112.7/share, an 8.4% discount to the Alibaba (9988 HK) close and a 3.6% discount to the Alibaba (BABA US) close.
• There will be passive buying from trackers of one global index later this week, while trackers of the other global index will buy in November. No impact for local indices.

• Alibaba (9988 HK)  is looking to raise around US$10bn to fund its AI spending.
• Alibaba (BABA US) recently reported its 1H26 results, with elevated AI capex and negative free cash flows.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• There are 61 adds and 15 deletes for the Hang Seng Composite Index (HSCI) at the September rebalance to take the number of index constituents up to 580.
• Of the 61 HSCI inclusions, 6 are already a part of StockConnect. 54 stocks will be added from the open 7 September. All 15 deletion will be removed from StockConnect.
• Stocks that are expected to be added to Southbound Stock Connect have massively outperformed stocks that are expected to be removed from Southbound Stock Connect over the last 3 weeks.

• HSIL announced the Sep 2026 rebalance results, with two ADDs and no DELETE.
• Hua Hong Grace and Weichai Power join the HSI on 7 Sep 2026.
• Both ADDs fell into the announcement. Historically, positive opening gaps averaged -2.3% post-open, so we wait for the open before sizing.

• HS TECH September 2026 review announced one ADD and one DELETE.
• Iluvatar Corex enters and Tongcheng Travel leaves, effective 7 Sep 2026.
• Both names fell into the announcement in the pre-announcement window. Historically, comparable ADDs kept rising after the open, and comparable DELETEs rebounded after announcement day.

• The September 2026 HSCI review adds 53 names to southbound Connect, 49 new and 4 returning, and removes 15, all effective 7 Sep 2026.
• The announced list ran wider than our forecast. 33 of our 36 ADD calls and 14 of 25 DELETE calls were announced.
• Current ADDs rose into the announcement and DELETEs fell. Historically, ADD-NEWs outperformed ADD-REJOINs over the bridge, while DELETEs fell further after announcement.

• Zhuhai Kingsware Artificial Intelligence Co., Ltd. is an AI company providing AI digital worker and enterprise-grade agent solutions. It ranked first in China’s AI digital worker solutions market by revenue.
• Zhuhai Kingsware deployed over 2.0 million AI digital workers and serves over 1,600 clients, including 120+ Fortune Global 500 companies.
• The company reported revenue of RMB256,097 in 2025 and a loss for the year of RMB(345,635) in 2025. Net liabilities were RMB1,578,703.

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• Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
• On the IPO front, SHEIN Global Holdings (SHEIN HK) is set to launch this week/today, as per media reports, while deal in India continue to flow in.
• On the placement front, Alibaba (9988 HK) launched the largest HK primary raising yet on Sunday. 

• Eaglerise Electric & Electronic (CHINA) Co., Ltd. is a global supplier of power equipment and solutions, leveraging proprietary core technologies and R&D capabilities, specializing in transformer equipment.
• The company ranked second among China-based suppliers in the global medium-voltage transformer equipment market with a 2.3% share in 2025.
• Gross profit margin decreased from 21.7% in 2023 to 17.6% in 2025.

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• SSI New Material (Zhenjiang) Co., Ltd. is an electronic functional enhancement materials company with an established presence across four key material types. Its products enhance performance in consumer electronics and.
• The company ranked first in global acoustic enhancement materials with 20.0% market share in 2025, and revenue increased by 76.1% in 2025.
• Gross profit margin decreased from 56.1% in 2024 to 46.6% in 2025, and net profit may decline for the year ending 2026.

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