Two technology firms that listed in January, KNOWLEDGE ATLAS (02513.HK) and MINIMAX-W (00100.HK), are strong contenders for inclusion in the Hang Seng Tech Index after their shares surged more than 300 percent post-IPO. The official results of the quarterly review are due after market close today.
"KNOWLEDGE ATLAS could attract between HKD51 billion and HKD92 billion in southbound capital inflows," Bloomberg Intelligence analysts estimated, highlighting the significant passive investment the inclusion would unlock.
The potential additions come after a period of intense investor interest, with KNOWLEDGE ATLAS climbing 24.9 percent and MINIMAX-W adding 13.7 percent in recent trading. The broader Hang Seng Index, however, was more subdued, rising just 0.1 percent as other Asian markets like Japan's Nikkei 225 surged 3.5 percent on a positive global mood.
Inclusion in the key indexes would force exchange-traded funds and other passive investment vehicles to buy the shares. Under the fast entry rule, KNOWLEDGE ATLAS could become eligible for the mainland-Hong Kong Southbound Stock Connect on June 8, opening it up to a new class of investors. MINIMAX-W's entry may be delayed until August due to stricter requirements for companies with weighted voting rights (WVRs).
The review has spurred analyst commentary on other potential changes. Willer Chen, an analyst at Mizuho Securities, said BEONE MEDICINES (06160.HK), BEKE-W (02423.HK), ZHAOJIN MINING (01818.HK), and YUM CHINA (09987.HK) are likely candidates for the main Hang Seng Index.
Chen also suggested that AKESO (09926.HK) may join the Hang Seng China Enterprises Index, while SUNNY OPTICAL (02382.HK) could be at risk of being removed from the Hang Seng Index, reflecting shifts in the market's composition.
This article is for informational purposes only and does not constitute investment advice.
