On July 7, YOFC (Yangtze Optical Fibre and Cable) declined 3.32% in regular trading, trading at HK$165.5/share, with turnover of HK$696 million. The stock extended its steep selloff from a recent high of HK$304, having lost nearly half its value amid a broad optical communications sector rout.

The decline reflects continued sector-wide pressure driven by multiple headwinds. Nomura has flagged accelerating capacity expansion in the fiber optic industry, warning that if new entrants successfully develop high-end products such as hollow-core fiber and execute expansion plans, market competition will intensify and incumbent players face margin compression. Additionally, Corning's newly announced glass bridge technology has raised market concerns over long-term demand for midstream fiber optic components, prompting short-term capital to continuously mark down valuations across the sector.

UBS, however, maintained a Buy rating with a HK$290 target price, arguing the pullback is sentiment-driven rather than fundamental, noting new capacity requires 1.5 to 2 years from construction to volume production. Peer companies including Hangzhou Cable reported H1 earnings growth of 852%-958%, suggesting robust underlying demand persists.

(The above content is based on publicly available market information, generated by a program or algorithm, and is intended solely as a stock movement alert. It does not constitute investment advice or a basis for trading decisions.)