On November 21, AUTOSTREETS (02443) saw its intraday share price hit a low of HK$3.38, edging closer to setting a new post-listing low amid a prolonged downtrend. Despite being listed for less than two years, the stock has experienced extreme volatility.

After its IPO in May last year at HK$10.20, AUTOSTREETS spent much of its time trading below the offering price. Even after being included in the Stock Connect program on September 10, the stock remained weak, bottoming at HK$3.80—a 60% drop from its IPO price. A sudden surge on October 8 briefly propelled the stock by 344% intraday to HK$117, closing nearly 100% higher. However, on November 27, the stock plunged over 40% within half an hour of trading due to its first major post-listing lock-up expiry, ending at HK$6.80, down 44.44% for the day.

Since then, AUTOSTREETS has largely traded sideways between HK$3–HK$5, hitting a record low of HK$3.22 on April 7 this year amid broader market turbulence before rebounding 13.99% the next day. The recent revisit to HK$3.38 raises questions about investor positioning ahead of its likely removal from the Stock Connect program.

**Impending Removal from Stock Connect?** Following a July 18 peak at HK$5.11, AUTOSTREETS entered another downtrend. Since October, its technical indicators have turned bearish, with moving averages converging downward—a sign of trend reversal. This aligns with expectations of its exclusion from the next Stock Connect adjustment in March, based on its 12-month average market cap of HK$3.34 billion, well below the current HK$6.10 billion threshold.

Historical data shows stocks removed from the program average a 14.24% decline on the adjustment day, with liquidity often drying up. This prospect may be accelerating the current sell-off.

**Southbound Funds Bet Against the Trend?** Despite heavy overhead resistance (only 0.16% of shares are in profit, with a locked-in supply peak at HK$4.22), some Stock Connect investors are buying. On November 21, top sellers included Goldman Sachs and UBS, while China Investment (Shanghai-Hong Kong Stock Connect) and China Creation (Shenzhen-Hong Kong Stock Connect) were net buyers, acquiring 1.27 million and 287,000 shares respectively. Their combined 14.5% stake suggests mainland retail investors are speculating on a technical rebound.

The stock’s recent trading pattern mirrors its May–July movement, where a Bollinger Band squeeze preceded a rally. Currently trading near the lower band with dwindling volume (only five days above 5 million shares in two months), a rebound could emerge if selling pressure eases. However, post-exclusion, the forced sell-off of ~14% Stock Connect-held shares may create sustained downward pressure.

Investors should note that once delisted from Stock Connect, mainland buyers can only sell existing positions—potentially turning supportive liquidity into a headwind.