MiniMax, Zhipu Make Hang Seng Tech Index History
Key insights
- MiniMax and Zhipu became the first pure-play AI firms ever included in Hong Kong's Hang Seng Tech Index.
- Morgan Stanley estimates the pair could represent 5-7% of the index, implying US$1.25-1.75 billion in passive inflows.
- Zhipu's simultaneous Stock Connect entry opens its shares to mainland Chinese investors alongside the index inclusion.
Why this matters
Index inclusion forces every passive fund tracking the Hang Seng Tech benchmark to buy MiniMax and Zhipu shares, creating non-discretionary demand that operates independently of analyst ratings or quarterly earnings. Morgan Stanley's projected US$1.25-1.75 billion in eventual passive inflows sets a structural demand floor, material for two companies entering a major Asian tech benchmark as the first pure-play AI firms. Zhipu's concurrent Stock Connect admission is the more consequential unlock, routing mainland Chinese retail and institutional capital into a Hong Kong-listed AI company at benchmark scale for the first time.
Summary
MiniMax Group and Zhipu (Knowledge Atlas Technology) became the first pure-play AI firms in Hong Kong's Hang Seng Tech Index, making every passive fund tracking the benchmark obligated to buy both stocks.
Both debuted during a regional tech selloff sparked by a stronger-than-expected US jobs report that reduced rate-cut expectations across Asia. MiniMax fell 8.4% to HK$506; Zhipu gained 1.3% to HK$1,314, even as the Hang Seng Tech Index dropped 2.7%, South Korea's Kospi plunged 8.3%, and Taiwan's Taiex fell 3.5%.
Essentially: (MiniMax, Zhipu) are now benchmarked assets passive funds must hold.
- Morgan Stanley projects the pair could reach 5-7% of the index, implying US$1.25-1.75 billion in passive inflows.
- Zhipu starts at a 0.53% weighting vs. MiniMax's 0.36%, and simultaneously entered the Stock Connect programme.
- Hong Hao, CIO at Lotus Asset Management: index funds "will be forced to buy."
Passive inclusion gives Chinese AI companies a structural capital floor in Hong Kong that analyst ratings alone cannot provide.
Potential risks and opportunities
Risks
- If US rate cuts are delayed into late 2026, continued Asia tech valuation compression could erode MiniMax and Zhipu's market caps before passive inflows reach the US$1.25-1.75 billion range Morgan Stanley projects.
- Zhipu's Stock Connect admission creates a direct channel for mainland retail selling pressure; rapid sentiment shifts could amplify volatility and strain its 0.53% starting index weighting.
- International passive fund managers may face geopolitical compliance pressure to underweight Chinese AI names in the Hang Seng Tech Index, capping actual inflows below Morgan Stanley's top-end US$1.75 billion estimate.
Opportunities
- Other Chinese AI companies now have a clearer Hong Kong listing playbook for unlocking simultaneous Hang Seng Tech benchmark inclusion and Stock Connect passive flows in a single rebalancing event.
- Hong Kong asset managers such as Lotus Asset Management can offer early overweight exposure to MiniMax and Zhipu ahead of passive fund rebalancing cycles that generate incremental forced buying.
- Broker-dealers with existing Stock Connect infrastructure gain new revenue as mainland Chinese investors route capital into Zhipu following its Monday programme admission.
What we don't know yet
- No timeline given for when MiniMax and Zhipu might reach the 5-7% eventual index weight Morgan Stanley cited -- the article provides no rebalancing schedule or milestones.
- Whether MiniMax's 8.4% debut decline reflects purely macro pressure or a company-specific valuation concern at its 0.36% starting weight.
- Which other Chinese AI companies are candidates for future Hang Seng Tech Index rebalancing, and what market-cap thresholds they must clear to qualify.
Originally reported by scmp.com
Read the original article →Original headline: MiniMax and Zhipu Become First Pure-Play AI Companies in Hong Kong's Hang Seng Tech Index — Morgan Stanley Projects $1.25–1.75B in Passive Inflows