[ET Net News Agency, 02 April 2025] Concerns over the US's introduction of equivalent
tariff policies have led to a decline in the Hong Kong stock market at the opening. By
around 9:50 AM, the Hang Seng Index fell to a low of 22,980 points, marking its first drop
below 23,000 in nearly a month. However, as the index approached this level, it found
support, rebounding by as much as 187 points. Nevertheless, the gains narrowed again, and
the Hang Seng concluded the half-day session at 23,221, up 14 points or less than 0.1%,
with a total turnover exceeding HKD 130.2 billion.

"Cheung Chi Wai: Weak trading in HSI, possibility of dropping to 22,500"

The Hang Seng opened several points lower this morning, with the index dropping more
than 200 points at one stage to reach 22,980, but it has since rebounded. Cheung Chi Wai,
a joint managing director at Prudential Brokerage Ltd, told ET Net News Agency that the
Hang Seng has cumulatively fallen about 1,800 points from its high of 24,874 last month,
and this is the first time it has dropped below the 23,000 mark since the recent peak. He
does not rule out some investors engaging in short-term speculation, especially as the
Mainland China A-shares have also rebounded, driving the Hang Seng's recovery. However,
trading volumes in Hong Kong stocks have significantly decreased recently. For instance,
yesterday's turnover was around HKD 250 billion, a marked reduction compared to previous
figures of HKD 300 to 400 billion. Additionally, global markets are closely monitoring
developments in the tariff war, suggesting that any upward momentum may not be
sustainable, and there is a greater likelihood of further declines in the short term.
There is a possibility of dropping below 23,000 again, and based on the year's largest
rally in the Hang Seng, which rose approximately 6,200 points, the adjustment could reach
as low as 22,500.

"Leapmotor excels in cost-effectiveness, leading the new energy vehicle sector"

Yesterday, several new energy vehicle manufacturers announced their delivery figures for
March, with Leapmotor achieving a delivery volume of 37,095 vehicles, a year-on-year
increase of 154.65%, topping the delivery rankings among new car manufacturers for the
first time. Following closely was Li Auto, which delivered 36,674 new vehicles in March,
up 26.53% year-on-year. XPeng Motors (09868) delivered a total of 33,205 new vehicles in
March, a year-on-year increase of 267.88%, while Nio (09866) delivered 15,039 vehicles,
growing 26.7% year-on-year.
After the data was released, Leapmotor's stock price surged by as much as 11%, reaching
a high of HKD 56, setting a new record since its listing. Cheung Chi Wai noted that
Leapmotor primarily follows a low-price strategy, with its revamped vehicles featuring an
appealing design. The group's affordable model generally includes a 62 kWh battery and a
range of 525 kilometres. Given that the technology and performance of electric vehicles in
Mainland China are largely accepted by consumers, Leapmotor continues to see soaring sales
due to its competitive cost-effectiveness. Cheung Chi Wai expects Leapmotor to maintain
quarterly profitability, with a potential turnaround to profit next year, setting a target
price of HKD 60.
Although XPeng's delivery figures for March and the first quarter are commendable in
terms of growth, Cheung Chi Wai suggested that it is necessary to observe whether it can
maintain high growth in deliveries over the coming quarters. He cited Li Auto as an
example, noting that while it also experienced rapid growth last year, it could not
maintain that momentum. Thus, it is difficult to draw conclusions based solely on one
quarter's delivery numbers. Another electric vehicle company, Xiaomi, has recently faced
challenges due to an incident involving its SU7 model. As the case remains unresolved, it
is difficult to pinpoint the exact issue, but it has inevitably put pressure on the stock
price, which recently dropped to a month-low of HKD 44.6.
Overall, in the electric vehicle sector, he personally remains optimistic about BYD
(01211), which saw a 25% increase in deliveries in March and a 60% increase in the first
quarter, with solid sales figures. Cheung Chi Wai indicated that BYD is still a leader in
the electric vehicle market, possessing scale and technological advantages. The group
previously announced that its new vehicles could be charged in five minutes for a range of
400 kilometres, representing a significant advantage. Today's softness in the stock price
may be related to price promotions in its Japanese operations, but the outlook for the
stock price to rise above HKD 400 remains positive.