Zhitong Hong Kong Stock Analysis | Internal Reorganization Boosts Confidence, Giants Make Moves, SKYWORTH GROUP Soars at Market Close

[Market Dissection]

Last week, there was a frenzy of short selling, but after withstanding the pressure, the buying force began to gain momentum. Today, both markets rebounded positively, with the Hang Seng Index closing up 0.85%.

In August, the U.S. adjusted non-farm payrolls recorded an increase of 22,000, far below the market expectation of 75,000. There is no doubt that the Federal Reserve will cut interest rates by 25 basis points; if inflation data does not rise, a 50 basis point cut is also possible. Innovative drugs acted as a direct catalyst, with FOSUN PHARMA (02196), CanSinoBIO (06185), WuXi Biologics (02269), and Kangzheng Pharmaceutical (00867) all rising over 6%. The external situation is not good; around 6 PM local time on September 7, Japanese Prime Minister and Liberal Democratic Party President Shigeru Ishiba held an emergency press conference at the Prime Minister's residence, announcing his decision to resign as president of the Liberal Democratic Party. The reason is that under pressure from both the U.S. and domestically, he could not find a good solution, and since no one can afford to offend anyone, he simply chose to step down. It is estimated that it would be the same for anyone else. The French government is on shaky ground, with Prime Minister François Bayrou's government likely to collapse on Monday, triggered by Bayrou's attempt to gradually reduce France's massive debt. Currently, France's total government debt has reached €3.35 trillion, expected to reach 116% of economic output this year, making it one of the countries with the highest debt levels in the Eurozone. Interest payments have surged from €26 billion in 2020 to €66 billion, surpassing the education or military budget. Controlling the debt is difficult for anyone in power, unless there are fundamental reforms. Ironically, while the country is in such a state, Macron is still vigorously aiding and actively promoting the war in Ukraine.

On Sunday, Trump stated that he is ready to advance to the second phase of sanctions against Russia, hinting at possible increased sanctions on Russia's homeland or its oil buyers regarding the Russia-Ukraine conflict. This is likely mainly aimed at India, as he cannot afford to offend Turkey due to Israeli interests, and he is even more cautious with us, as it is truly unmanageable on various levels. OPEC is seizing the opportunity to increase production and capture Russian market share. On September 7, OPEC announced that eight major oil-producing countries among OPEC and non-OPEC producers decided to increase production by 137,000 barrels per day in October. The previously mentioned oil shipping leader COSCO SHIPPING Energy (01138) rose again by over 9%.

Looking globally, China maintains world peace and engages in mutually beneficial trade with countries around the world. Domestically, measures are actively being taken to rectify issues, with former Securities and Exchange Commission Chairman Yi Huiman being dismissed: overseeing 1,700 IPOs in five years, with the index falling below 3,000 points 20 times. Additionally, the Chinese Ministry of Foreign Affairs announced today sanctions against Japanese Senator Ishihara, freezing his movable and immovable assets and other properties within our country. The Ministry of Foreign Affairs commented on Ishihara: "forgetting one's roots, selling conscience, colluding with anti-China forces, provoking trouble." It is indeed necessary to severely crack down on various pests that harm the country to clarify the situation. Only when these potential undercurrents are addressed will the stock market confidence be positively boosted.

A positive phenomenon today is that several major internet giants rebounded actively. Bloomberg reporter Mark Gurman revealed in an article the latest progress of Apple's China version of Apple Intelligence, stating that due to internal and external issues, Apple was unable to launch the China version of Apple Intelligence as scheduled mid-year, but Apple is still committed to achieving this goal Alibaba will continue to serve as the foundational model provider, driving the domestic Apple smart services; Baidu AI will also support Siri and visual intelligence, equivalent to the role of OpenAI in the non-domestic version. Apple's plan is to launch by the end of this year. It seems that Apple aims to bind these two giants to reverse its decline. On the evening of September 5th, Alibaba's Tongyi Qianwen launched Qwen3-Max-Preview (Instruct), with a parameter count reaching 1T, making it the largest model to date, achieving significant enhancements in Chinese and English understanding, complex instruction following, and tool invocation, while greatly reducing knowledge hallucinations. Today, Alibaba (09988) rose over 4%, Baidu (09888) surged over 9%, and Tencent (00700) rose nearly 2%.

Over the weekend, the market was buzzing about Tesla's board unveiling a $1 trillion compensation plan, solely to allow Musk to focus on the business. This massive compensation plan mentions that one of the product goals is to cumulatively deliver 1 million robots. Tesla also launched a Weibo account named 'TeslaAI' and posted its first Weibo saying 'I have been working hard to improve my figure,' showcasing the new version of the Optimus humanoid robot. It is evident that Musk is betting on robots. Today, the variable robot company announced that it has secured 1 billion yuan in funding in a new round of A+ financing.

The robot craze is reigniting, with Sanhua Intelligent Control (02050) surging over 15% after being included in the Hang Seng Composite Index. MicroPort Scientific Corporation-B (02252): TUMI installed 16 units overseas in the first half of the year, with over 30 new orders, and the current overseas order revenue recognition cycle is generally 1-2 months. Institutions expect the company to reach 45 units installed for the year (the company's initial guidance was 40 units). In the first half of the year, the company's overseas revenue proportion has exceeded that of the domestic market, rising over 10% today; other stocks like Delta Electronics (00179) rose over 8%. Hesai Technology's official website shows that Hesai Group has launched a global offering of 17 million Class B shares, with the code 2525 for dual primary listing on the Hong Kong Stock Exchange. Hesai Technology's inclusion has lifted the stock of its counterpart, Suoteng Juchuang (02498), which rose nearly 7% today.

On September 6th, SAIC-GM-Wuling signed a deepening cooperation agreement with Huawei. Among the key contents of this cooperation is the "semi-solid-state battery." The self-developed Shenlian semi-solid-state battery cell by SAIC-GM-Wuling has improved thermal stability by 20°C, can adapt to a wide temperature range of -30°C to 60°C, increases low-temperature power by 55%, shortens charging time by 30%, and improves energy retention rate by 18%. More importantly, the high-voltage manganese-based cathode material of the Shenlian semi-solid-state battery achieves a volumetric energy density of 500-800Wh/L, with a pure electric range exceeding 1000km. The continuous iteration of semi-solid-state batteries makes a transition to all-solid-state batteries only a matter of time. Related stocks, such as lithium iron phosphate cathode material manufacturer Longpan Technology (02465), rose over 8%. Ganfeng Lithium (01772) also rose over 5% again.

It is worth mentioning that Zhitong's September gold stock, SKYWORTH GROUP (00751), surged today. On September 5th, at the IFA 2025 exhibition, SKYWORTH GROUP showcased over 100 AI smart home appliance products under its brand, covering various categories such as smart displays and smart home devices Today, it surged over 34%, possibly related to the founder's mention of plans for partial spin-offs of innovative businesses by 2025 last year.

【Sector Focus】

On September 8th, the National Development and Reform Commission and the National Energy Administration released implementation opinions on promoting high-quality development of "Artificial Intelligence +" in the energy sector. By 2027, a preliminary innovation system integrating energy and artificial intelligence will be established, and the foundation for the coordinated development of computing power and electricity will be continuously strengthened. By 2030, the specialized technologies and applications of artificial intelligence in the energy sector will reach a world-leading level, forming a number of globally leading "Artificial Intelligence +" energy-related R&D innovation platforms and composite talent training bases. The "Implementation Opinions" systematically deploy artificial intelligence + power grid, new energy business formats, new energy, hydropower, thermal power, nuclear power, coal, and oil and gas as eight major application scenarios around various energy types such as coal, electricity, oil, and gas.

The ultimate competition of AI is actually about energy, so the development of China's energy support is of utmost importance. Major varieties include Longyuan Power (00916), China General Nuclear Power New Energy (01811), Huaneng International (00902), China Power (02380), and China Resources Power (00836).

【Stock Picking】

Kangzheng Pharmaceutical (00867): Strong growth of innovative products with double growth in revenue and net profit

In the first half of 2025, Kangzheng Pharmaceutical achieved revenue of approximately 4.0 billion yuan, a year-on-year increase of 10.8%; net profit was approximately 930 million yuan, a year-on-year increase of 3.1%.

Commentary: Kangzheng Pharmaceutical achieved year-on-year growth in both revenue and profit in the first half of the year, with initial results from its strategic transformation. The company's main exclusive/brand products and innovative products generated total pharmaceutical sales revenue of approximately 2.9 billion yuan, a year-on-year increase of 20.6%, accounting for 62.1% of total pharmaceutical sales revenue (approximately 4.67 billion yuan). The competitive landscape for the company's exclusive/brand products and innovative products is favorable, with strong growth predictability. So far, the company has successfully commercialized five innovative drugs; within 2025, two innovative products, Lurconidine Cream (for vitiligo) and Dexamethasone Tablets (for renal anemia), are also expected to be approved for market launch. In the pipeline, several major candidate drugs have entered the late clinical development stage in China and are expected to be commercialized in the next 1-3 years. In the first half of 2025, the company added two co-developed innovative products: ZUNVEYL (for Alzheimer's disease) and long-acting anti-IL-4Rα humanized monoclonal antibody injection MG-K10 (for AD, rhinitis, etc.). So far, the company has laid out approximately 40 differentiated innovative pipelines, including 20 self-researched projects. Other ongoing projects show that about 10 items are smoothly advancing in clinical development in China, with Y-3 injection as a new brain protectant for stroke treatment pushing into Phase III clinical trials; anti-IL-4Rα humanized monoclonal antibody injection MG-K10 (for AD, asthma) is advancing to Phase III clinical trials; and VEGFA+ANG2 tetravalent bispecific antibody is advancing to Phase II clinical trials, which is expected to further open up long-term growth space for the company. In the future, innovative products will be approved for market launch in phases, continuously injecting growth momentum