HK Stock Market Move | ZENERGY (03677) surged more than 14% in trading, the company has recently been included in the Hong Kong Stock Connect list, with the scale effect and high capacity utilization is expected to continue.

ZENERGY (03677) soared more than 14% during trading hours, rising 5.67% to HK$11.92 as of the time of writing, with a turnover of HK$213 million. On the news front, ZENERGY previously announced that its shares have been included in the list of securities eligible for Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect, effective from September 8th. The board believes that being included in the list of securities for the two Stock Connect programs will help accelerate the expansion of the company's shareholder base, improve the liquidity of the company's shares, enhance the company's reputation in the capital market, and increase the company's brand awareness. CMB International released a research report stating that as a latecomer, ZENERGY has less historical burden than most of its peers. Combined with the management's strategic focus on standardizing battery cells and platform-based battery packs to improve manufacturing efficiency, this constitutes the company's core competitive advantage. The report points out that ZENERGY has achieved profitability in the past two reporting periods and achieved industry-leading gross profit margins in a highly concentrated customer base, attributed to high production capacity utilization, advanced manufacturing lines, and excellent management capabilities. Looking at the customer structure, economies of scale and high production capacity utilization are expected to continue at least until the end of 2026, with potential improvements in profit margins from customer structure changes. It is expected that GAC Toyota will become ZENERGY's second largest customer this year, and with the support of Volkswagen's extended-range models, foreign brands are expected to contribute around half of ZENERGY's revenue by 2027.