Core Viewpoint - The inclusion of Sanhua Intelligent Control in the Hong Kong Stock Connect marks a significant development for "A+H" companies, reflecting the growing trend of A-share companies listing in Hong Kong and the positive market response to these listings [1][2][6]. Group 1: Company Inclusion in Hong Kong Stock Connect - Sanhua Intelligent Control (02050) has been added to the Hong Kong Stock Connect eligible securities list effective July 21, 2025, following the end of its price stabilization period in Hong Kong and after its A-share listing met the required trading days [1][2]. - This year, several "A+H" companies have been included in the Hong Kong Stock Connect, including Chifeng Jilong Gold Mining (06693), JunDa Co., Ltd. (02865), Contemporary Amperex Technology Co., Ltd. (03750), and others [1][5]. Group 2: Trends in A-share Companies Listing in Hong Kong - There has been a notable increase in A-share companies seeking listings in Hong Kong, with 10 companies having listed in 2023 as of July 17 [6][7]. - A small surge in A-share companies applying for Hong Kong listings occurred in July, with 11 companies submitting applications from July 1 to July 11 [7]. Group 3: Regulatory Environment and Market Dynamics - Regulatory improvements have been a key driver for A-share companies to list in Hong Kong, including measures from the China Securities Regulatory Commission to expedite the approval process for mainland companies [8]. - The Hong Kong Stock Exchange has also introduced initiatives to attract A-share companies, such as a fast-track review process for companies with a market capitalization exceeding HKD 10 billion [8]. Group 4: Market Sentiment and Pricing Dynamics - Unlike previous trends where H-shares traded at lower prices than A-shares, many "A+H" companies have seen their H-share prices exceed A-share prices this year, boosting confidence in A-share companies listing in Hong Kong [9]. - As of July 18, 155 out of 160 "A+H" companies had a premium for their A-shares over H-shares, indicating a positive market sentiment [10].

Core Viewpoint - The article discusses the recent decline of the AH Premium Index, which has reached a five-year low, indicating a significant shift in the pricing dynamics between A-shares and H-shares [4][6]. Group 1: AH Premium Index Trends - The AH Premium Index dropped to 127.84 points, the lowest in five years, compared to over 160 points in February 2024, reflecting a 0.8% percentile position over the past five years [4]. - The financial sector (including banks, brokers, and insurance) has contributed significantly to the decline of the AH Premium Index, accounting for 64% of the decrease since 2025, 60% since April 7, and 76% since June [8]. - The top 25 stocks, primarily state-owned enterprises and resource stocks, have contributed to 79% of the decline since 2025, 71% since April 7, and 85% since June [8]. Group 2: Sector Contributions - The weighted AH premium rate for growth stocks has narrowed significantly, from 64.6% to 42.2% as of June 6, with non-bank financials, banks, and oil & gas sectors being the largest contributors to this decline [9]. - The contributions from sectors such as automotive and pharmaceuticals were also noted, with respective contributions of -0.9% and -0.6% [9]. Group 3: Market Sentiment and Future Outlook - The future trajectory of the AH premium rate remains uncertain, with varying opinions on whether it will continue to narrow or stabilize, depending on market sentiment and sector performance [9]. - Analysts suggest that the choice between A-shares and H-shares should not be oversimplified and should consider the specific investment strategies and profiles of different investors [11].

Core Viewpoint - The AH share premium index has dropped to a new low of 128.05 points, the lowest since July 2020, indicating a potential trend towards equal pricing for dual-listed companies in the future [1] Group 1: AH Share Premium Index - The AH share premium index has fallen below 127 points, currently at 128.05 points, marking a significant decline [1] - The continuous decrease in the AH share premium index reflects a combination of market rationality and institutional progress [1] Group 2: Future Outlook - There is an expectation that the valuation premium for high-quality dual-listed stocks will continue to decrease, potentially leading to equal pricing for AH shares [1] - Achieving equal pricing for AH shares is seen as a positive development for the valuation recovery of these stocks [1] Group 3: Investment Considerations - Investors are advised to focus on the fundamentals of companies, industry trends, and global layout capabilities when seizing opportunities related to equal pricing of high-quality AH shares [1] - The realization of equal pricing in the market will further strengthen China's position as a crucial hub for global asset allocation [1]

Core Viewpoint - The Hang Seng Stock Connect AH Premium Index has reached a five-year low, indicating a narrowing premium of A-shares compared to H-shares, reflecting a convergence in valuation differences between the two markets [1][2][5]. Group 1: AH Premium Index Performance - The Hang Seng Stock Connect AH Premium Index hit a low of 126.91 points on June 12, marking a new five-year low [1][2]. - The index has experienced a cumulative decline of approximately 10% year-to-date, following a period of fluctuations [2]. - The index has been below 100 points in the past, indicating a time when A-shares traded at a discount to H-shares, but since 2015, A-shares have generally traded at a premium [4]. Group 2: Market Comparison - Year-to-date performance shows that the Hong Kong market indices have outperformed A-share indices, with the Hang Seng Index up 19.82%, while the Shanghai Composite Index has only increased by 1.52% [5]. - The Shenzhen Component Index has decreased by 1.73%, and the ChiNext Index has dropped by 3.48% [5]. Group 3: Individual Stock Analysis - Among 155 companies analyzed, over 150 still show a premium of A-shares over H-shares, with 145 companies having a premium rate exceeding 10% [7]. - Notable exceptions include Ningde Times, WuXi AppTec, and China Merchants Bank, which are trading at a discount [8]. - Some companies, such as Weichai Power and Zijin Mining, have seen their A-share and H-share price differences significantly narrow, with Weichai Power's A-share and H-share price difference reduced to within 5% [8]. Group 4: Market Dynamics - The influx of southbound capital has improved liquidity and enhanced marginal pricing power in the Hong Kong market [9]. - The listing of more quality enterprises in Hong Kong is expected to attract additional capital and address structural issues in the Hong Kong market [9].

Core Viewpoint - The article discusses the significant divergence between A-shares and Hong Kong stocks, highlighting the recent drop in the AH premium index, which has reached a five-year low, indicating potential investment strategies based on historical patterns of market behavior [1][3][4]. Group 1: AH Premium Index - The AH premium index, which measures the price ratio of A-shares to H-shares for companies listed on both exchanges, has fallen below 130, marking the lowest point since June 2020 [1][3]. - Historically, when the AH premium index drops below 130, it has often been followed by a sharp rebound, suggesting that this threshold can serve as a quantitative trading factor for investors [3][4]. - The frequency of the AH premium index dropping below 130 has increased, indicating a downward shift in its central tendency, which may suggest a new normal for the index [4][5]. Group 2: Market Trends and Predictions - Since February 2024, the market has experienced a prolonged downtrend, influenced by unprecedented interest rate declines and policy adjustments affecting institutional investments in Hong Kong stocks [5][6]. - Short-term adjustments in the Hong Kong market are anticipated due to the AH premium index falling below 130, with recent net selling by southbound funds in major internet companies indicating market pressure [6]. - In the medium to long term, the low interest rate environment may continue to push the AH premium index lower, establishing a new norm where the index remains below 130 for an extended period [6]. Group 3: Biopharmaceutical Sector - Despite the overall decline in the Hong Kong market, the biopharmaceutical sector has shown strong performance, with the Hang Seng Medical ETF rising over 50% year-to-date [8][10]. - The introduction of the 18A policy by the Hong Kong Stock Exchange in 2018 has allowed unprofitable biotech companies to list, leading to a supply advantage for innovative drug companies in Hong Kong compared to A-shares [10]. - Investors are advised to consider both long-term asset allocation in high-growth sectors and short-term trading strategies in the volatile biopharmaceutical market [12][14].