[ET Net News Agency, 05 March 2025] Chinese Premier Li Qiang delivered the government
work report, leading to a general rise in the domestic demand sector and Chinese financial
stocks. Additionally, CKH Holdings (00001) achieved a "century deal," with its share price
soaring by 20%. This drove the Hang Seng Index to close up 377 points or 1.6% at 23,319,
recovering the 23,000 mark and breaking through the ten-day moving average (approximately
23,214). The main board recorded a turnover of nearly HKD 135.2 billion. The Hang Seng
China Enterprises Index stood at 8,520, up 152 points or 1.8%. The Hang Seng Tech Index
was at 5,638, up 102 points or 1.9%.

"Nip Chun Pong: If the Hang Seng Index cannot maintain 23,500 at closing, future movements
remain to be observed"

Despite declines across European and US markets, this did not prevent the Hang Seng
Index from opening over 200 points higher this morning. The National People's Congress
opened today in Beijing, where Premier Li Qiang stated that a more proactive fiscal policy
would be implemented this year. The planned deficit rate is around 4%, with a deficit
scale of RMB 5.66 trillion, and the issuance of ultra-long special government bonds
amounting to RMB 1.3 trillion and special bonds of RMB 500 billion. The general public
budget expenditure is set at RMB 29.7 trillion, an increase of RMB 1.2 trillion from last
year. The report emphasised boosting consumption, improving investment efficiency, and
comprehensively expanding domestic demand. An arrangement of RMB 300 billion in ultra-long
special government bonds will support the replacement of consumer goods. Additionally, the
People's Bank of China will timely reduce reserve requirements and interest rates to
stimulate the economy.
Supported by the government work report, the Hang Seng Index surged by as much as 572
points earlier in the session. Nip Chun Pong, the Chief Strategist at Blackwell Global
Securities, told ET Net News Agency that following China's countermeasures against the
U.S. increase in import tariffs on the 4th, the renminbi strengthened overnight, dropping
from around 7.3 to approximately 7.25 against the dollar. Furthermore, despite the
overnight decline in U.S. stocks, ADRs showed a stronger performance, and the Golden
Dragon Index, which reflects the performance of Chinese concept stocks, also rose, laying
the groundwork for today's gains in Hong Kong stocks. However, Nip Chun Pong pointed out
that the future movement of the Hang Seng Index remains to be observed. If it closes today
above 23,500 and maintains that level over the next two days, there is still room for
upward movement. If the index retraces, the initial support level is 22,800; if it cannot
hold above 22,500, further downward adjustments may be necessary.

"CKH Holdings sells port equity, eliminating operational uncertainties"

CKH Holdings (00001) announced that it has reached a principled agreement with a
BlackRock-led consortium, which will acquire 80% of the equity in Hutchison Ports (the
remaining 20% is held by Singapore's sovereign wealth fund, Temasek). The assets include
the recently controversial Panama port company equity, with a transaction value of USD
14.212 billion (approximately HKD 110.854 billion). However, the sale does not include any
equity in the Hutchison Port Trust, which operates ports in Hong Kong, Shenzhen, and South
China, nor any ports in China. This transaction is expected to generate over USD 19
billion (about HKD 148.2 billion) in cash proceeds.
Although the group emphasised that the transaction is purely for commercial interests,
Nip Chun Pong believes this sale is somewhat related to the pressure the U.S. has placed
on Panama. After U.S. President Trump accused China of gaining control over the Panama
Canal, he stressed that the U.S. must reclaim the canal. Following a meeting between
Panama's President Mulino and U.S. Secretary of State Rubio in early February, it was
announced that Panama would not renew agreements related to the Belt and Road Initiative,
with reports suggesting that Panama is seeking a compromise and considering whether to
cancel Hutchison Ports' operating rights at the Panama port.
Nip Chun Pong pointed out that in the face of political pressure and operational
uncertainties, the group's decision to sell the aforementioned business is a wise move, as
evidenced by the positive response in today's share price increase. He believes that after
the asset sale, the group will have a substantial amount of capital that can be redeployed
into other high-return assets, providing new returns for the group. He also does not rule
out the possibility of the group issuing a special dividend after the transaction is
completed.
CKH Holdings' share price surged nearly 25% today, reaching a high of HKD 48.2. Nip Chun
Pong suggests that if the share price approaches HKD 50 in the coming days, it might be
wise to take profits. If the share price falls back to HKD 45, he also recommends exiting,
as good news has already been released and today's gains have been significant. For
investors without shares, they should wait until the price drops below HKD 44 before
considering an entry. He also noted that local property stocks are beginning to show signs
of recovery, and investors might consider the group's affiliate, CK Asset (01113), which
rose 4.76% to HKD 35.2 by midday.