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Chinese hard tech giants see value surge in first half as global investors pour in capital
Under the mainland-Hong Kong Connect programme, northbound holdings rise to record high of 3.13 trillion yuan by end of June
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Overseas capital has poured into China’s hard technology champions at an unprecedented pace, driving the market value of their mainland equity holdings to an all-time high by the end of this year’s second quarter.
Global investors have increased their exposure to China’s advanced manufacturing and technology companies, helping push the northbound holdings under the mainland-Hong Kong Stock Connect scheme to a record high of 3.13 trillion yuan (US$461.65 billion) by the end of June, according to financial data provider Choice, the highest quarterly level since the launch of the programme.
The latest figures point to a broader repositioning of overseas portfolios towards industries linked to Beijing’s push for technological advancement and self-sufficiency, marking a departure from the consumer and financial stocks that had traditionally dominated foreign holdings.
Technology and advanced manufacturing companies now account for seven of the 10 largest foreign-held A-share positions, including the top three.
Battery maker Contemporary Amperex Technology Co Limited (CATL), artificial intelligence optical-module supplier Zhongji Innolight and semiconductor equipment manufacturer Naura Technology ranked top three among those with the biggest holdings by overseas investors.
Goldman Sachs said the sector rotation reflected investors’ growing preference for onshore “hard-tech” companies over offshore “soft-tech” platforms, reiterating its tactical preference for A-share technology names in a July 13 research note.
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