CICC has released a research report analyzing the impact of the Hang Seng Index and Hong Kong Stock Connect adjustments. The team notes that according to the consultation results published by Hang Seng Indexes Company in March 2021, the number of Hang Seng Index constituents is set to increase to 80 by mid-2022, eventually stabilizing at 100. While expansion toward this target continues, the overall progress has been slower than anticipated.

Following this adjustment, the weight of new economy stocks in the Hang Seng Index has slightly increased from the current 48.9% to 50.0%, returning to above the 50% threshold. At the sector level, the Information Technology and Industrial sectors have seen their weights rise from 14.9% and 10.0% to 15.9% and 10.9%, respectively. In contrast, the Financials and Utilities & Telecommunications sectors experienced declines, dropping from 34.3% and 6.2% to 32.4% and 6.0%.

Key points from the research report summary are as follows:

Hang Seng Series Index Adjustments: The Hang Seng Index has added CMOC Group, Lao Feng Xiang, and Contemporary Amperex Technology (CATL). The Hang Seng China Enterprises Index has included Ke Holdings and Horizon Robotics, while China Resources Beer was among the stocks removed. The Hang Seng TECH Index saw no constituent changes.

Fund Flow Estimates: Positive impacts are anticipated for CMOC Group, Ke Holdings, Horizon Robotics, and Lao Feng Xiang. Negative effects are expected for HSBC HOLDINGS, among others.

Hong Kong Stock Connect Adjustments: It is estimated that 44 stocks may meet the criteria for inclusion in the Stock Connect scheme, while 25 others are likely to be removed.

Adjustment Timeline: The index adjustment results will take effect on Monday, March 9. To minimize tracking error, passive funds are expected to adjust their portfolios on the preceding trading day, March 6.

On February 13, 2026, after market close, Hang Seng Indexes Company announced the results of its regular semi-annual index review. This review, which considered data up to December 31, 2025, is typically announced within eight weeks after the review date. The adjustments cover major Hong Kong equity benchmark indices such as the Hang Seng Index, HSCEI, and Hang Seng TECH Index, as well as the Hang Seng Composite Index, which directly determines the investable universe for Stock Connect.

A comprehensive analysis of the impact is provided for investor reference.

Hang Seng Series Index Adjustments: The Hang Seng Index has added CMOC Group, Lao Feng Xiang, and Contemporary Amperex Technology (CATL). The Hang Seng China Enterprises Index has included Ke Holdings and Horizon Robotics. The Hang Seng TECH Index remains unchanged.

Constituent Changes: 1) Hang Seng Index: Added CMOC Group (0.51% weighting), Contemporary Amperex Technology (0.39% weighting), and Lao Feng Xiang (0.29% weighting). The number of constituents increased to 90. 2) Hang Seng China Enterprises Index: Added Ke Holdings (0.90% weighting) and Horizon Robotics (0.88% weighting). The number of constituents remains at 50. 3) Hang Seng TECH Index: No changes; the number of constituents stays at 30.

Fund Flow Estimates: Based on Bloomberg data, ETFs tracking the Hang Seng Index manage approximately $29.45 billion, while those tracking the HSCEI and Hang Seng TECH Index manage around $8.95 billion and $50.94 billion, respectively. Using the changes in constituents and weightings, along with the average daily trading volume of each stock over the past three months, the potential impact of passive fund flows is estimated:

1) Hang Seng Index: The newly added constituents—CMOC Group, Lao Feng Xiang, and Contemporary Amperex Technology—are expected to see the largest passive inflows, estimated at approximately $150 million, $85 million, and $110 million, requiring about 1.3, 1.0, and 0.7 trading days to absorb, respectively. Due to weighting adjustments, HSBC HOLDINGS and CLP Holdings may experience passive outflows of around $500 million and $50 million, requiring approximately 2.5 and 1.5 trading days, respectively.

2) Hang Seng China Enterprises Index: The newly added Ke Holdings and Horizon Robotics are expected to attract the largest passive inflows, estimated at $80.51 million and $78.72 million, requiring about 1.2 and 0.5 trading days, respectively. China Mengniu Dairy and China Resources Beer, with current weightings of 0.47% and 0.39%, may see passive outflows of approximately $42.04 million and $34.89 million, requiring about 0.95 trading days.

3) Hang Seng TECH Index: Despite no constituent changes, Horizon Robotics is expected to see the largest passive inflow due to weighting adjustments, estimated at $130 million, requiring about 0.85 trading days.

Hong Kong Stock Connect Adjustments: 44 Stocks Eligible for Inclusion, 25 May Be Removed Coinciding with the semi-annual review of the Hang Seng Composite Index, which is adjusted twice a year based on data as of June and December year-ends, the HSCI adjustments will primarily determine the investable universe for Stock Connect. Based on the review results and Stock Connect inclusion criteria, the potential adjustments are as follows.

44 stocks may meet the criteria for inclusion: Innoviz Technologies, Woan Robotics, Jiaxin International Resources, Chow Tai Fook Enterprises, Insilico Biotechnology, Bank of East Asia, JD Industrial, Dipu Technology, Lingbao Gold, Wasion Holdings, Guofu Quantum, Wuyi Shijie, Cirrus Aircraft, Baoji Pharmaceutical-B, Guoxia Technology, Health 160, Botai Automotive, Leshu Shi, Paige Biopharmaceutical-B, Xunce, Zhida Technology, Qingsong Health, Quantgroup, Yaocai Securities Financial, Zhonghui Biology-B, Consun Pharmaceutical Group, Tuhu Automotive, Chizicheng Technology, Huishang Bank, Nuobikan, Butong Group, Haixi New Drug, Changfeng Pharmaceutical, Jingfang Pharmaceutical-B, Xuanzhu Biotechnology-B, Jingwei Tiandi, Xidizhijia, Weilinzhibo-B, Jushuitan, Zhuoyue Ruixin, Xipuni, Keji Pharmaceutical-B, OSL Group, and Hashkey Holdings.

Compared to the 44 stocks predicted for inclusion in the mid-January preview report, 43 have met the inclusion criteria. However, due to uncertainties in calculating floating market capitalization and turnover rates—as Hang Seng Indexes Company does not publicly disclose floating share ratios—one stock differed from the prediction. Efforts will continue to optimize these estimates.

Notably, OSL Group and Hashkey Holdings are newly listed virtual asset platforms. While they have entered the Hang Seng Composite Index as predicted, their inclusion in Stock Connect remains uncertain due to their nature as virtual asset platforms. Investors are advised to be aware of this possibility.

Additionally, WeRide-W, Pony.ai-W, and Minglue Technology-W, which were added to the Hang Seng Composite Index, have weighted voting rights structures. They must meet additional requirements, including being listed for at least six months and 20 trading days, and thus will not be eligible for Stock Connect inclusion in March. The earliest possible inclusion is expected in June.

Post-Adjustment Index Characteristics: Healthcare and Industrial Weights Rise, Financials and Consumer Sectors Decline Index Expansion: The number of Hang Seng Index constituents has increased to 90. According to the March 2021 consultation results, the index was scheduled to expand to 80 constituents by mid-2022, eventually reaching 100. While progress continues toward this goal, it has been slower than expected.

Sector Coverage and Representation: Coverage of the Industrial and Consumer sectors has improved. Based on Hang Seng Indexes Company's industry classification, coverage of the Industrial sector increased from 47.5% to 49.9%, while coverage of the Consumer sector rose from 68.3% to 69.0%.

Sector Weightings: The Information Technology and Industrial sectors saw increased weightings, while Financials and Utilities & Telecommunications declined. Following the adjustment, the new economy weighting in the Hang Seng Index increased from 48.9% to 50.0%, returning above 50%. The Information Technology and Industrial sectors rose from 14.9% and 10.0% to 15.9% and 10.9%, respectively, while Financials and Utilities & Telecommunications fell from 34.3% and 6.2% to 32.4% and 6.0%.

Adjustment Timeline: Effective March 9 The index adjustment results will take effect on Monday, March 9. During this period, some active funds may engage in arbitrage based on the announced results. However, passive funds are likely to adjust their portfolios on the preceding trading day, March 6, to minimize tracking error. Trading volumes for relevant stocks are expected to see significant increases, particularly during the closing auction.