HK Stock Market Move | Shenzhen Longsys Electronics (09976) fell over 8% on the second day of its listing, drawing attention due to its discounted issuance and stock reduction. The cash flow for the first half of the year turned from positive to negative.

Shenzhen Longsys Electronics (09976) experienced a drop of over 8% in the afternoon, with the stock price falling below the issuance price of HK$236 on its first day of listing yesterday. As of the time of writing, it was down 6.85%, priced at HK$217.6, with a trading volume of HK$175 million. In terms of news, Shenzhen Longsys Electronics, as an independent domestic brand semiconductor memory manufacturer, specializes in the research, design, and sales of Flash and DRAM memory products, and owns three major brands: FORESEE, Lexar, and Zilia. It is noteworthy that the H-share issuance price for Shenzhen Longsys Electronics is approximately RMB 204, which represents a discount of over 40% compared to the closing price of RMB 358.22 per share for the A-shares on September 7. Just a month ago, Shenzhen Longsys Electronics completed a round of A-share private placement at RMB 560 per share, raising RMB 3.7 billion. On the other hand, several directors and shareholders of Shenzhen Longsys Electronics have also been reducing their holdings at high prices in the A-shares this year. From a fundamental perspective, despite Shenzhen Longsys Electronics achieving a net profit of RMB 10.577 billion in the first half of 2026, its cash flow has not improved accordingly. In the first half of this year, the net cash flow from operating activities was -RMB 3.151 billion, compared to RMB 693 million in the same period last year, representing a decline of 554.82%. The real cash drain comes from inventory. As of the end of June, Shenzhen Longsys Electronics reported an inventory of RMB 25.777 billion, which is about 120.73% higher than the RMB 11.678 billion at the end of 2025, accounting for 60.12% of total assets of RMB 42.877 billion.