Daily Brief China: Midea Group, Shenzhen Longsys Electronics, Bank Of America, Yangtze Optical Fibre and Cable, Changhong Jiahua, J&T Global Express, Shenzhen Forms Syntron Information, Triapex Laboratories and more

• In this insight we discuss about Midea Group (300 HK)’s resilient business model in midst of challenging industry situation. 
• We discuss how AI, Robotics & Smart Buildings Are Saving the Day for the company.
• Finally, we conclude with our view on H2 FY2026 performance.

• Shenzhen Longsys Electronics (301308 CH) (SLE), a branded independent semiconductor memory product enterprise, raised around US$1,050m in its H-share listing.
• SLE designs, develops, manufactures and sells a comprehensive portfolio of memory products for edge AI and traditional consumer, enterprise and industrial applications.
• We have looked at the past performance and likely A/H premium in our previous note. In this note, we talk about the trading dynamics.

• Longsys, a branded memory-module maker, raised HKD 6,803.2m (USD 867.7m) in net proceeds from its Hong Kong IPO and will list on the SEHK on Tuesday, September 8, 2026.
• In our previous note, we looked at the company’s deal terms, cornerstone and sponsor track records, and valuation.
• In this note, we provide an update for the IPO before its trading debut.

• Short sellers made bold moves the week of August 31.
• MOO saw the most dramatic buildup – short interest tripled in seven days.
• At the other end, MSFT shorts nearly disappeared entirely, and GME saw rapid covering ahead of its September 8 earnings.

• In 1H26, YOFC’s total revenue grew by 54% YoY, with the main business OCP up by 59%YoY.
• Operating Margin rose to 37% in 2H26 from 9% in 1H25.
• We believe the stock has at least 37% upside potential for 2027.

• SASAC Valuation Floor Deadlock: The primary regulatory bottleneck stalling the M&A transaction is the State-owned Assets Supervision and Administration Commission (SASAC) valuation floor, which prohibits the sale or transfer of state-owned enterprise (SOE) assets below their appraised net asset value (NAV). With Changhong Jiahua trading at a deep market discount of approximately 0.3x to 0.4x price-to-book (P/B), a massive valuation gap exists between public market pricing and the regulatory minimum transfer price, halting private strategic interest.
• AI Distribution Working Capital Strain: The company’s strategic pivot toward AI distribution (e.g., domestic AI servers and localized graphics processing units) is a working capital drain rather than a margin savior. The cash conversion cycle is deteriorating because upstream domestic chip designers demand near-cash or tight 30-day payment terms, while downstream state-backed enterprise buyers demand extended payment windows of 120 to 180 days, severely squeezing liquidity and increasing short-term borrowing costs.
• Geopolitical Sanctions Discount: Geopolitical tech-import restrictions and the parent company’s (Sichuan Changhong Electric) historical industrial ties create a persistent valuation discount. Prospective foreign buyers and multinational private equity firms are deterred by US Department of Commerce Entity List risks and foreign exchange repatriation hurdles managed by the State Administration of Foreign Exchange (SAFE), leaving only domestic state-backed syndicates as viable but slow-moving acquirers.

• In H126 J&T Global reported strong top-line growth of almost 40% Y/Y vs H125
• Growth was broad-based, and core adj EBITDA margin also showed solid Y/Y improvement
• Overall, a nice set of numbers from J&T Global in H1, but stock isn’t cheap here

• Shenzhen Forms Syntron Information Co., Ltd. is a Greater Bay Area fintech service provider, delivering software development, consulting, and system integration services to financial institutions. It holds seven patents and.
• Over 90% of the workforce are technical professionals, and the Hong Kong fintech market is projected to reach RMB44.0 billion by 2030.
• In 2025, revenue was RMB631,068 thousand and profit for the year was RMB74,281 thousand. Net current assets were RMB1,258,798 thousand as of March 31, 2026.

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• Unlike traditional CROs which act as external service providers to handle scattered tasks, TRIAPEX is strategic R&D partner for clients,offering end-to-end services covering entire process from drug discovery to NDA.
• Monkeys, as biological assets, have their fair value changes directly recorded in profit statement, acting as an “amplifier” for TRIAPEX’s performance. This will lead to significant fluctuations in future performance.
• TRIAPEX’s valuation would be lower than Joinn Lab. The final valuation depends on  the price trend of laboratory monkeys and the overall valuation of biopharmaceutical sector in Hong Kong stock market.