HK Stock Market Move | DEKON AGR(02419) rose more than 14% in early trading, as the policy of adjusting the production capacity of live pigs continues to intensify. The industry's fundamentals and valuation are expected to improve.

DEKON AGR(02419) soared over 14% in the morning session, rising 12.46% at the time of writing, reaching HKD 46.2, with a turnover of HKD 284.148 million. On the news front, according to a report from China Business News, since June, the Ministry of Agriculture and Rural Affairs and the National Development and Reform Commission have held consecutive meetings on capacity control, proposing rigid requirements for large-scale farming enterprises for the first time and setting a deadline of the end of September to complete capacity reduction and elimination of inefficient sows. With detailed control measures being implemented in various regions and leading enterprises setting quantitative reduction targets, the disposal of pig production capacity is transitioning from passive to active acceleration. Shanxi believes that the pig industry has been under pressure recently, with the period of industry losses being a good time for capacity disposal. Under the guidance of the pig industry policies, capacity disposal under policy control may proceed simultaneously, leading to the third noticeable capacity disposal since 2021. The fundamentals and valuation of the pig farming industry are expected to be restored.