Is the takeout war over? Meituan and Alibaba surge! Huabao’s $10-billion Hong Kong-listed internet ETF touches more than 3%! Fund managers: fundamentals are being improved, and valuation is the flexible safeguard.

On March 25th, Hang Seng Tech opened higher in the morning, continuing its rebound trend, then oscillated into the red, and in the afternoon, under the stimulus of the “takeout industry’s internal competition” news, it resumed its rally. The State Market Supervision Administration reposted an article from the Economic Daily titled “The Takeout War Should End.” Additionally, the Market Supervision Administration recently revealed that it has stationed personnel on relevant platforms to conduct on-site investigations, clearly conveying the regulatory stance that “the takeout war must be halted.”

Once the news broke, Meituan-W quickly surged with high volume, closing nearly 14% higher. Alibaba-W rose over 6% intraday and closed up more than 4%. Moreover, Xiaomi Group-W slightly declined by 0.49% after earnings, and Tencent Holdings fell more than 1%. Notably, southbound funds had a net purchase of over 20 billion Hong Kong dollars throughout the day.

The core AI tool in Hong Kong stocks—the Hong Kong Internet ETF Huabao (513770)—once rose over 3% in intraday trading, closing up 1.86%. It has rebounded continuously from this round of correction lows and has broken above the 5-day moving average.

Overall, a series of recent policies aimed at reducing internal competition are gradually becoming clearer, which is expected to cool down price wars among major platforms and bring performance recovery expectations. Coupled with the continuous strengthening of AI narratives and accelerated AI commercialization, this may be an excellent opportunity to strategically invest in high-quality Hong Kong internet assets at a dip.

Fund manager Feng Chencheng of the Hong Kong Internet ETF Huabao (513770) pointed out that multiple positive factors are resonating, and the fundamentals of Hong Kong internet stocks are expected to be gradually revised upward starting from Q2, with valuation and positioning providing resilience for future gains. Specifically:

On one hand, domestic AI-related innovations and product popularization are emerging one after another, continuing to be important clues for the subsequent market trend. Major internet giants remain directly and comprehensively involved in AI themes (GPU, large models, cloud, agent applications). Recently, the collective price increases of large model vendors and cloud service providers also indicate significant upward elasticity in future computing power and cloud service prices amid changing demand; at the same time, AI is expected to enhance the sustainability of Tencent’s gaming business, especially evergreen games.

On the other hand, the aggressive market share battles in the instant retail sector represented by Alibaba have shown limited positive feedback in recent earnings reports regarding synergy with e-commerce and overall operational competitiveness. Regulatory voices also echo the waning of this internal competition. The rollback of subsidies helps reduce losses in instant retail, aiding a rebound in overall corporate profits.

Seizing the first year of AI commercialization in 2026, focus on core AI tools in Hong Kong stocks. The Hong Kong Internet ETF (513770) and its linked funds (Class A 017125; Class C 017126) passively track the CSI Hong Kong Stock Connect Internet Index, with the top ten holdings including tech giants like Alibaba-W, Tencent Holdings, and various AI application companies across fields. These have prominent leading advantages, with T+0 trading within the day and good liquidity.

Looking favorably on Hong Kong tech stocks but want to reduce volatility? You can also consider the market’s first—Hong Kong Top 30 ETF (520560), which features a “tech + dividend” dumbbell strategy. Its heavy holdings include high-elasticity tech stocks like Alibaba, as well as stable, high-dividend stocks such as banks and insurance companies, making it an ideal core holding for long-term Hong Kong stock allocation.

Reminder: Recent market volatility may be significant, and short-term gains or losses do not predict future performance. Investors should invest rationally based on their own financial situation and risk tolerance, paying close attention to position sizing and risk management.

Data sources: Shanghai and Shenzhen Stock Exchanges, etc.

ETF fee-related notes: When investors subscribe or redeem fund shares, the subscription or redemption agent may charge a commission not exceeding 0.5%, including related fees charged by stock exchanges, registrars, etc. Fee details for the linked funds: Huabao CSI Hong Kong Stock Connect Internet ETF Launch-Style Linked Fund (A class) has a subscription fee of 1,000 yuan per transaction for amounts over 2 million yuan, 0.6% for 1–2 million yuan, and 1% for less than 1 million yuan; redemption fee is 1.5% if held less than 7 days, 0% if held 7 days or more, with no sales service fee. The C class does not charge a subscription fee; redemption fee is 1.5% if held less than 7 days, 0% if held 7 days or more; sales service fee is 0.3%.

Risk warning: The Hong Kong Internet ETF passively tracks the CSI Hong Kong Stock Connect Internet Index, which was base date 2016.12.30, released on 2021.1.11, with index components adjusted periodically according to the index rules. The index components shown in this article are for display only; individual stock descriptions are not investment advice and do not represent holdings or trading trends of any fund managed by the manager. The risk level of this fund, as assessed by the fund manager, is R4—medium-high risk, suitable for active investors (C4) and above. All information in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, or any form of expression) is for reference only. Investors are responsible for their own investment decisions. Additionally, any opinions, analyses, or forecasts in this article do not constitute investment advice and the fund manager is not responsible for any direct or indirect losses caused by using this content. Past performance of other funds managed by the fund manager does not guarantee future performance. Investment in funds involves risks; please invest cautiously.