On September 16, Hong Kong hard-tech stocks mounted a strong comeback, with the underlying index of the HK Stock Connect Information Technology ETF HuaBao (159131) closing up 3.02%, firmly reclaiming its annual moving average. Among newly added constituents, Yunyinggu Technology and Axera Semiconductor surged over 10%, while Lenovo Group, Shanghai Fudan, and Fourier each gained more than 8%. Heavyweight stocks also performed well, with SMIC rising over 4% and Hua Hong Semiconductor climbing over 5%.

A wave of favorable developments in the semiconductor industry has provided solid support for the sector's strength. On the supply side, memory chip supply remains tight. Samsung Electronics was the first to suspend October DDR5 contract pricing, with SK Hynix and Micron quickly following suit, creating a supply chain crunch. Meanwhile, ChangXin Memory has officially begun mass production of LPDDR6, which debuts in the Xiaomi 18 Fold, accelerating the rollout of domestic consumer-grade memory chips.

On the technology front, key breakthroughs have been made in foundational tools like EDA. As domestic substitution pushes deeper, China's first 3D chip physical design tool and advanced process node convergence tool were released in early September.

On the capital side, Yangtze Memory Technologies has had its STAR Market IPO application accepted, with its review status now moved to "under inquiry." The company plans to raise 33 billion yuan, marking the largest IPO since the STAR Market's inception. Its first-quarter 2026 net profit attributable to shareholders reached 33.379 billion yuan, highlighting the robust profitability of domestic memory manufacturers.

According to Zhongyuan Securities, the continued expansion of AI infrastructure investment is driving sustained strong demand for advanced memory. Global memory manufacturers are accelerating capacity expansion. SEMI's latest forecast projects 2026 global 300mm wafer fab memory equipment investment will reach $52 billion, up 29% year-on-year, with a compound annual growth rate of 19% expected from 2024 to 2029. As AI drives global memory makers to accelerate capacity expansion, semiconductor equipment supply tightness is likely to gradually increase, potentially accelerating the overseas expansion of domestic semiconductor equipment. Combined with ongoing domestic substitution efforts, opportunities in domestic semiconductor equipment and component manufacturers are worth attention.

The HK Stock Connect Information Technology ETF HuaBao (159131) offers rare pure-play hard-tech exposure in Hong Kong and supports T+0 trading. Tracking the HK Stock Connect Information Technology Index, the fund is composed of roughly 80% hardware and 20% software, heavily weighted toward semiconductors, electronics, and computer software. It covers 74 Hong Kong-listed hard-tech companies, including the "foundry duo" of SMIC and Hua Hong Semiconductor, domestic AIPC leader Lenovo Group, and the "domestic large-model duo" of Zhipu AI and Minimax. The index excludes large-cap internet companies like Alibaba, Tencent, and Meituan, making it easier to capture Hong Kong's AI hard-tech rally. For investors without a securities account, the off-market feeder fund (026755) provides an alternative one-stop entry point into Hong Kong hard tech.

Per the fund manager's assessment, the HK Stock Connect Information Technology ETF HuaBao carries an R4 risk rating (medium-high risk), suitable for aggressive investors (C4) and above. Investors should refer to their sales institutions for suitability opinions. Recent market volatility may be significant, and short-term gains or losses do not predict future performance. Fund investments may incur losses. Investors should make rational decisions based on their own capital conditions and risk tolerance, paying close attention to position and risk management.

Data sources include the China Securities Index Company and exchanges in Shanghai and Shenzhen. Institutional views reference Zhongyuan Securities' September 15, 2026 report, "Semiconductor Industry Maintains Rapid Growth in 26Q2, Domestic Memory Manufacturers Post Strong Earnings."

Regarding ETF fees, agents may charge commissions of up to 0.5% for subscription and redemption of fund shares. On-exchange trading fees are subject to actual charges by securities firms, with no sales service fee. For the HuaBao CSI HK Stock Connect Information Technology ETF Feeder Fund, subscription fees are 0.30% for amounts below 1 million yuan, 0.20% for 1 million to 2 million yuan, and 1,000 yuan per transaction for 2 million yuan or more. Redemption fees for individual investors are 1.50% for holdings under 7 days and 0.00% for 7 days or more. For institutional investors: 1.50% for under 7 days, 1.00% for 7 to 30 days, 0.50% for 30 to 180 days, and 0.00% for 180 days or more, with no sales service fee.

The index constituents mentioned in this article are for display purposes only and do not constitute investment advice in any form, nor do they represent the holdings or trading activities of any fund under the manager. As of September 14, 2026, the weights of the mentioned index constituents are as follows: Lenovo Group 15.52%, SMIC 14.67%, Hua Hong Semiconductor 6.86%, Zhipu AI 0.78%, Minimax 0.198%, Shanghai Fudan 0.512%, Yunyinggu Technology 0.06%, Axera Semiconductor 0.08%, and Fourier 0.06%.

The HK Stock Connect Information Technology ETF HuaBao passively tracks the CSI HK Stock Connect Information Technology Composite Index, with a base date of November 14, 2014, and a release date of June 23, 2017. Annual historical returns for the CSI HK Stock Connect Information Technology Composite Index (HKD) from 2021 to 2025 were -9.54%, -34.47%, -0.25%, 21.58%, and 39.30%, respectively, with annual volatility of 4.13%, 4.63%, 4.00%, 5.49%, and 5.45% over the same period. Past index performance does not guarantee future results. Index constituent composition is adjusted according to the index methodology, and backtested historical results do not indicate future performance. Any information in this article (including but not limited to stocks, commentary, forecasts, charts, indicators, theories, and any form of expression) is for reference only. Investors are solely responsible for their own investment decisions. Any views, analyses, or forecasts herein do not constitute investment advice to readers, and no liability is assumed for direct or indirect losses arising from the use of this content. Fund investment carries risks; past performance is not indicative of future returns, and the performance of other funds managed by the fund manager does not guarantee the performance of this fund. Investors should invest cautiously.