According to market intelligence, Zhang Qinrui, Head of China Technology Research at CLSA Securities, indicated that investor concerns regarding tariff impacts on Apple's (AAPL.US) supply chain have largely subsided, with iPhone 17 and 18 upgrades expected to drive growth among application suppliers. He noted that the foldable iPhone, slated for launch in 2026, will stimulate handset replacement cycles and boost value growth for suppliers of glass covers, metal casings, and flexible printed circuits (FPC).

Overall, across Hong Kong stocks, U.S. markets, and Chinese markets, artificial intelligence represents a new global growth driver, with China's greatest potential residing in AI server manufacturing. Zhang explained that as mainland China's demand increases, many manufacturing-oriented companies in this sector may benefit. Currently, due to geopolitical factors, AI servers supplied to the United States originate from Taiwan-based manufacturers. In the future, when mainland China develops its own supply chain and establishes the necessary technology and ecosystem, the growth potential will be even greater.

He also mentioned that HUA HONG SEMI (01347) and SMIC (00981) have recently shown improved fundamentals. Over the past two to three years, price wars occurred in the sector, combined with capital market conditions last year, resulting in very low valuations. Now, industry fundamentals are improving, capacity utilization rates are better, prices have stopped declining, and some products have even seen price increases. Although A-shares are influenced by mainland China's stock market sentiment and capital flows, leading to higher current valuations, historically there have been periods when valuations were even higher than present levels.