HK Stock Market Move | Cig Shanghai (06166) now down over 4%, plans share placement + convertible bonds to raise over HK$6.5 billion for high-speed optical module capacity expansion.

Cig Shanghai (06166) fell over 9% intraday. As of press time, it was down 4.51% at HK$105.8, with a turnover of HK$1.012 billion. On the news front, on October 8, Cig Shanghai announced plans to raise HK$6.535 billion. The financing will take the form of approximately 70% convertible bonds + 30% share placement. If the placement and conversion are completed successively, the company's total share capital will increase from approximately 368 million shares to approximately 423 million shares, an increase of about 14.8%, with the A-share proportion diluted from 74.84% to 65.20%. The announcement stated that the proceeds will be used to enhance optical module production capacity, make strategic investments in selected upstream enterprises, and supplement working capital. The company plans to expand its annual high-speed optical module production capacity by at least 10 million units before the end of 2027 to meet demand for 800G, 1.6T, and NPO products, with the new capacity allocated to Jiashan, China, Malaysia, Mexico, and the United States; the company's order backlog growth rate exceeds its capacity growth rate.