Group 1 - The global liquidity environment is becoming more accommodative, leading to a significant inflow of international capital into the Hong Kong market, particularly in the biotech sector [1][2] - As of September 12, 2025, southbound capital from mainland China has net purchased over 10,000 billion HKD in Hong Kong stocks this year, representing a growth of over 100% compared to last year, with the biotech sector attracting 1613 billion HKD [1] - The implementation of Chapter 18A of the Hong Kong Stock Exchange's main board listing rules since 2018 has allowed unprofitable biotech companies to enter the capital market, raising over 800 billion HKD and establishing Hong Kong as a major biotech financing hub [1] Group 2 - In 2025, national policies have been introduced to support the biotech industry, emphasizing innovation and significantly shortening the drug approval process, with IND and NDA approvals increasing by 14.3% and 52.3% respectively in 2024 [2] - The shift in healthcare insurance policies towards supporting innovative drugs has opened new payment channels for high-value drugs, enhancing their market accessibility [2] - A comprehensive policy framework is being established to support the entire lifecycle of innovative drugs from development to market sales, creating sustained growth opportunities for companies and investors [2] Group 3 - The Hang Seng Biotech Index, launched in December 2019, focuses on innovative drugs and contract research organizations (CROs), with nearly 90% of its weight in these sectors, showcasing top industry players [3] - The index has demonstrated exceptional growth and resilience, with a year-to-date increase of over 100% as of early September 2025, significantly outperforming the Hang Seng Index's 27% increase [3] - Despite recent market adjustments, the index's valuation remains relatively low at a price-to-earnings ratio of approximately 31 times, providing substantial room for future valuation recovery and earnings growth [3] Group 4 - The Hong Kong Stock Connect Biotech ETF (159102) offers investors a convenient tool to invest in the biotech sector, with liquidity advantages and no restrictions from QDII quotas [4] - The ETF allows for T+0 trading, enhancing its appeal for investors looking to capitalize on opportunities in the Hong Kong biotech market [4]