Northbound funds | Northbound trading net purchase of 15.373 billion, exceeding expectations, tariff impact on Hong Kong stock market, Northbound trading seizes the opportunity to buy Xiaomi (01810) and Tencent (00700) on dips.

In the Hong Kong stock market on April 7th, Beishui had a net purchase of 15.373 billion Hong Kong dollars. Among them, the net purchase of Hong Kong Stock Exchange (Shanghai) was 9.171 billion Hong Kong dollars, and the net purchase of Hong Kong Stock Exchange (Shenzhen) was 6.202 billion Hong Kong dollars. The stocks with the highest net purchase by Beishui are XIAOMI-W (01810), Tencent (00700), and China Mobile Limited (00941). The stocks with the highest net sales by Beishui are BABA-W (09988), XPENG-W (09868), and INNOVENT BIO (01801). Active trading stocks in the Hong Kong Stock Exchange (Shanghai). Active trading stocks in the Hong Kong Stock Exchange (Shenzhen). XIAOMI-W (01810) received a net purchase of 2.534 billion Hong Kong dollars. In terms of news, Daiwa issued a research report stating that the recent stock price of Xiaomi Group has weakened after the accident and rights issue, but due to its good fundamentals, they believe that the price decline is an attractive buying opportunity. The bank pointed out that in the past few years, Apple's market share in the Chinese smartphone market has continued to decline, and they believe that Xiaomi's smartphones will have more cross-selling opportunities from high-end users in the future, thereby gaining more market share. The bank also believes that Xiaomi's IoT business still has considerable growth space in the coming years, and the company will continue to focus on products with high marginal profits and formulate overseas expansion plans. The bank expects that the group's growth in the electric vehicle market will continue and bring more synergies. Tencent (00700) received a net purchase of 1.936 billion Hong Kong dollars. In terms of news, China Securities Co., Ltd. stated that since digital games are not included in the range of goods covered by the current US tariffs, they are currently not affected by tariffs. Furthermore, as a form of mental entertainment consumption, the domestic demand for games is strong, with monthly growth rates of 28% and 12% in January and February of this year, respectively. Regarding game licenses, the number of domestically produced licenses from January to March of this year was around 362, an increase of approximately 10% year-on-year, with a rich array of new products this year, indicating a high level of domestic demand. China Mobile Limited (00941) received a net purchase of 1.164 billion Hong Kong dollars. In terms of news, China Mobile Limited's annual operating income reached 1,040.8 billion yuan, a year-on-year increase of 3.1%, with main business income of 889.5 billion yuan, a year-on-year increase of 3.0%; net profit attributable to shareholders was 138.4 billion yuan, a year-on-year increase of 5.0%; and free cash flow was 151.7 billion yuan, a year-on-year increase of 22.9%. Tianfeng pointed out that China Mobile Limited's dividend ratio for 2024 is 73%, with a total annual dividend of 5.09 Hong Kong dollars per share, a year-on-year increase of 5.4%. In order to better reward shareholders, starting from 2024, profits distributed in cash over a period of three years will gradually increase to more than 75% of the net profit attributable to shareholders. Semiconductor Manufacturing International Corporation (00981) received a net purchase of 964 million Hong Kong dollars. In terms of news, on April 3rd, the Japanese government announced export controls on more than a dozen semiconductor-related items. EB SECURITIES pointed out that Japan's further escalation of semiconductor sanctions will accelerate the pace of domestic substitution. Soochow previously stated that the increase in Chinese import tariffs is favorable for further increasing the localization rate of semiconductor equipment. POP MART (09992) received a net purchase of 584 million Hong Kong dollars. In terms of news, Lyon released a report stating that the US tariff parity was lower than expected, and they are optimistic about companies with strong pricing power and flexible cost structures, such as POP MART. Morgan Stanley published a research report stating that POP MART has the ability to raise prices in the US market to mitigate the impact of tariffs, so they are not overly concerned about its operating profit margin, but are more concerned about the possible global or regional economic decline after the imposition of tariffs. INNOVENT BIO (01801) saw a net sale of 421 million Hong Kong dollars. In terms of news, according to Yicai, the Office of the Director of the National Institutes of Health (NIH) website announced enhanced data security measures for NIH controlled access data, prohibiting institutions from countries of concern such as China, Russia, and Iran from accessing NIH controlled access data repositories and related data starting last Friday (April 4). China Securities Co., Ltd. believes that the impact of tariff policies on the pharmaceutical industry chain is complex and may still have variables. At the current point in time, the bank is optimistic about the innovative pharmaceutical industry that is temporarily unaffected by tariffs. BABA-W (09988) saw a net sale of 1.947 billion Hong Kong dollars. In terms of news, Trump announced equal tariffs on April 2, exceeding market expectations. In addition, Trump signed an executive order canceling tariff exemptions for small packages sent from mainland China and Hong Kong to the United States. It is worth noting that Aliyun's business continues to increase capital expenditures, with capital expenditures expected to exceed the total of the past ten years in the next three years. Additionally, CNOOC (00883) and MEITUAN-W (03690) received net purchases of 1.147 billion and 553 million Hong Kong dollars, respectively. XPENG-W (09868) saw a net sale of 894 million Hong Kong dollars.