Luxshare Precision Industry Co Ltd

China's Shanghai Composite stock index closed higher today (Aug. 26), rising 23.08 points, or 0.59%, to 3,912.52 points. Investors are watching the meeting of the Standing Committee of the National People's Congress (NPC), held from Aug. 25-28, amid hopes that the meeting will introduce policies to support the economy, following earlier weak economic data from Chinese authorities. Stocks that rose include Zijin Mining Group, up 2.35%; SMIC, up 3.46%; Luxshare Precision Industry, up 4.10%; and Sungrow Power Supply, up 2.76%. Additionally, China Merchants Bank issued a 3-year floating-rate bond linked to the overnight bond repurchase rate, making it the first Chinese commercial bank to do so. This reflects the People's Bank of China's (PBOC) efforts to elevate the overnight repo rate as a key benchmark for short-term funding costs, aligning its monetary policy framework more closely with international standards.

Luxshare Precision released its 2026 semi-annual report. In the first half of the year, it achieved operating revenue of 174.504 billion yuan, up 40.16% year on year. Net profit attributable to shareholders of the listed company was 7.843 billion yuan, up 18.04% year on year. The revenue growth was mainly due to an increase from business combinations and higher product shipments.

Luxshare Precision announced that, in order to meet production, operational, and business development needs, optimize its debt structure, and reduce financing costs, the company plans to register and issue bonds of up to 25 billion yuan, including corporate bonds and debt financing instruments for non-financial enterprises in the interbank market.

On the evening of August 24, multiple listed companies on the Shanghai and Shenzhen stock exchanges released important announcements. Dongshan Precision stated during its results briefing that its 1.6T optical module products have been supplied to customers, but due to commercial confidentiality, specific order information cannot be disclosed. Far East Smarter Energy's subsidiary plans to acquire 80% equity of Fudewangwang for 216 million yuan; Topstar Technology plans to acquire 49% equity of Lailer Optoelectronics for 147 million yuan; the merger and restructuring plan between Orient Securities and Shanghai Securities was approved by an overwhelming majority at the shareholders' meeting. In terms of performance, Eoptolink Technology's net profit in the first half of the year was 7.529 billion yuan, up 90.98% year-on-year; CIG Shanghai's net profit grew 171.08% year-on-year; Chengxin Lithium Group turned losses into profits year-on-year; Sinomine Resource Group's net profit surged 1146.81% year-on-year; Luxshare Precision's net profit rose 18.04% year-on-year. In addition, Genew Technologies' actual controller plans to increase holdings of company shares by 15 million to 30 million yuan, Selon Industrial plans to repurchase shares worth 30 million to 60 million yuan, Donghong Pipe Industry pre-won a steel pipe procurement project worth 144 million yuan, Longjian Road & Bridge jointly won a 333 million yuan engineering project, and Gangdi Technology's wholly-owned subsidiary signed a smart control system procurement contract worth approximately 230 million yuan with Huadong Heavy Machinery.

Luxshare Precision partially exercised its over-allotment option on August 5, 2026, involving a total of 12.54 million H shares, representing approximately 3.27% of the total offer shares available under the global offering. The offer price for these over-allotment shares was HK$63.28 per share. Following the exercise, the company's H shares increased from 383 million to 396 million shares, and it is expected to receive additional net proceeds of approximately HK$789 million from the issuance of the over-allotment shares. The stabilization period ended on August 5, 2026, during which the stabilizing manager purchased a total of 44.98 million H shares, accounting for approximately 11.73% of the total offer shares available under the global offering. In addition, the conversion price adjustment of the convertible corporate bonds triggered by the partial exercise of the over-allotment option and the resulting share issuance was less than RMB 0.01 per share, so the conversion price of the convertible bonds remains at RMB 55.67 per share.

Major Chinese companies are accelerating the relocation of downstream production bases to the ASEAN region to avoid tariff walls from the trade war, following the China Plus One strategy. A key case study is Luxshare Precision, an Apple component assembler, which has built twin factories in Vietnam and Malaysia to maintain its tier-one supplier status. Another is BYD, which has set up an electric vehicle assembly plant in Thailand's Rayong province to serve as an export hub to Australia and ASEAN, leveraging tariff privileges from free trade agreements. This relocation is seen as the largest production base shift cycle in 30 years, which will directly benefit Thailand's industrial estate, logistics, and utilities businesses.

A number of A-share companies have collectively disclosed their share buyback progress for July, with leading firms making sizable repurchases that stood out in the market. Baijiu leader Wuliangye bought back approximately 802 million yuan in July alone, bringing its cumulative buyback amount to about 1.002 billion yuan as of July 31. The company had earlier approved a plan to repurchase shares worth between 8 billion and 10 billion yuan within 12 months. Luxshare Precision had spent a total of about 1 billion yuan on its A-share buybacks by the end of July. Yonghe Shares completed its first buyback of roughly 8.1774 million yuan on the very first trading day after its shareholders' meeting approved a 150 million to 300 million yuan repurchase plan. In addition, Daqin Railway plans to buy back shares worth 400 million to 500 million yuan and cancel all of them to reduce registered capital. Sungrow Power intends to use 500 million to 1 billion yuan for share buybacks to fund employee stock ownership plans or equity incentives. Unilumin Group, PoCo Holding, Hongjing Technology, and Shenglan Technology also disclosed buyback plans ranging from tens of millions of yuan to 200 million yuan.

Luxshare Precision announced that as of July 31, 2026, the company had repurchased 17.67 million A-shares, representing 0.23% of total share capital, with a total repurchase amount of 1 billion yuan, at a price range of 50.14 yuan to 65 yuan per share. In the first quarter of 2026, Luxshare Precision achieved revenue of 83.888 billion yuan and net profit attributable to the parent of 3.66 billion yuan.

Luxshare Precision announced that as of July 22, 2026, the company had repurchased 17.6654 million shares through centralized bidding, accounting for 0.24% of total share capital, with a total transaction amount of about 1 billion yuan, excluding transaction fees. The buyback is for equity incentives or employee stock ownership plans, funded by self-raised funds, including special loans for stock buybacks.

Biwin Storage chairman Sun Chengsi has proposed that the company repurchase shares through centralized bidding, with a total buyback amount of 200 million to 250 million yuan. All repurchased shares will be cancelled to reduce registered capital. The buyback price ceiling will not exceed 150% of the average trading price of the company's stock over the 30 trading days before the board resolution approving the buyback plan, and will not exceed 558.44 yuan per share. A controlled subsidiary of Jereh Group has signed a gas turbine generator set supply contract with an internationally renowned cloud service provider. The order value is 1.465 billion US dollars, equivalent to approximately 9.95 billion yuan, accounting for about 61.33% of the company's audited 2025 revenue. The contract stipulates delivery in batches before November 2027. Yisheng Livestock & Poultry Breeding has released its 2026 semi-annual report, achieving operating revenue of 1.697 billion yuan, up 28.44% year-on-year, with net profit attributable to shareholders of the listed company of 308 million yuan, up 4897.29% year-on-year, and plans to distribute a cash dividend of 0.15 yuan per 10 shares. Lianxun Instruments expects its semi-annual 2026 net profit attributable to shareholders of the listed company to be between 510 million and 580 million yuan, up 802% to 926% year-on-year, benefiting from sustained high-speed growth in demand for high-speed optical communication products. In addition, several companies have disclosed buyback and shareholding change plans. Enjie New Materials plans to repurchase shares worth 100 million to 200 million yuan for equity incentives or employee stock ownership plans. Luxshare Precision has spent about 1 billion yuan on share buybacks. The chairman of Changjiang Securities has proposed a 100 million to 200 million yuan share buyback. Daqin Railway plans to repurchase 400 million to 500 million yuan of company shares for registered capital reduction.

Penghua Culture Media Entertainment Equity Fund disclosed its second-quarter 2026 report, recording a profit of 24.7272 million yuan for the period, with net asset value growth of 30.37%. As of quarter-end, the fund size stood at 66.8796 million yuan. Fund manager Xiao Jiaqian stated that the fund maintained its established strategy, firmly viewing AI applications as the core investment theme for the full year. She believes the media sector, as the most critical application scenario for AI, has sustained potential for earnings delivery, and that the short-term market correction stems from panic sentiment rather than fundamental deterioration. As of July 17, the fund's one-year annualized NAV growth rate was 15.04%, its three-year Sharpe ratio was 0.5736, and its three-year maximum drawdown was 35.24%. At the end of the second quarter, the top ten heavy-weight holdings included Luxshare Precision, Guoke Micro, and Zhiwei Intelligent.

Luxshare Precision H shares were officially listed and began trading on the Main Board of the Hong Kong Stock Exchange on July 9. The total number of H shares offered globally was 383 million shares, with the Hong Kong public offering accounting for about 10% and the international offering about 90%. Based on the offer price of HK$63.28 per H share, the company expects to receive net proceeds from the global offering of approximately HK$24.039 billion. In the first quarter of 2026, Luxshare Precision achieved revenue of 83.888 billion yuan and net profit attributable to the parent company of 3.66 billion yuan.

Hong Kong's equity capital markets raised nearly $44 billion in the first half of 2026, the highest level in five years, driven by strong investor demand for artificial intelligence-related companies. The total, which includes initial public offerings, share placements, and block trades, was up 29% from a year earlier and accounted for the largest share of the $122 billion raised across the Asia-Pacific region. Chinese companies linked to the AI supply chain led the activity, with battery maker Contemporary Amperex Technology and printed circuit board manufacturer Victory Giant Technology completing multibillion-dollar offerings. The surge came despite the Hang Seng Index falling nearly 12% this year and new regulatory measures from Beijing. Several AI-related companies are preparing to tap the Hong Kong market in the coming months, including electronics manufacturer Luxshare Precision Industry, which is planning a listing of about $3 billion, optical transceiver maker Zhongji Innolight, and Baidu's AI chip subsidiary Kunlunxin.