Private Equity Seizes New ETFs, Consensus Grows on Increasing Technology Assets

Translated from Shanghai Securities News, Ma Jiayue

Private equity is rapidly increasing its exposure to technology assets. As of May 29, over a hundred private equity products have appeared among the top ten holders of 97 newly listed ETFs this year, collectively holding nearly 1.8 billion shares. Notably, more than 30 STAR Market ETFs have been subscribed, totaling nearly 600 million shares.

Private Equity Boosts Technology Investment Through ETFs

STAR Market ETFs are especially favored by private equity. Data shows that this year, private equity products have been involved in 33 newly listed STAR Market ETFs, holding 571 million shares, which accounts for 32.02% of the total. Fourteen STAR Market ETFs have over 10 million shares held by private equity, with four related ETFs having over 40 million shares. Additionally, several private equity firms with over 10 billion yuan under management are using ETFs to invest in the technology sector. For example, Sixie Capital appears among the top ten holders of nine newly listed ETFs this year, four of which are STAR Market ETFs, while Xuanyuan Investment holds 3 million shares of the Southern Growth Enterprise Market Artificial Intelligence ETF.

Well-Known Institutions Heavily Invest in the Internet Sector

The HK Stock internet sector is also attracting numerous leading private equity firms. According to a roadshow presentation from a private equity firm with over 100 billion yuan under management, the largest investment sector across all its product lines is information technology, with high optimism for the HK stock internet sector. It believes that HK internet companies have shown excellent performance and returns, and advancements in large model technology will democratize AI, allowing China's rich internet application scenarios to benefit from this. Wellspring Capital has also positioned major internet companies as a key investment direction, noting their low valuations and readiness to embrace the AI revolution. CR Trust's monthly report indicates that, as of the end of April, the average allocation of HK stocks within the CR Trust Equity Fund Index (CREFI) has risen to 39.09%. Over 50% of 10-billion-yuan-level discretionary long strategy private equity firms heavily invest in internet companies.

China's Technology Asset Valuation Reset is Far From Over

Zhu Liang, founder of Danyi Investment, noted that the global AI hardware investment cycle has been underway for over two years, while the domestic investment cycle has only just begun. With an imminent explosion of AI applications, there are immense opportunities ahead. Ding Ying, Chairman of Commando Capital, stated that the current AI surge is significant, and by 2025, China's AI capital expenditures will accelerate, with substantial growth prospects for domestic computing power chips. According to Choice data, in the past month, the frequency of institutional research in the four major tech-related sectors—semiconductors, medical devices, automation equipment, and general machinery—exceeded 1,000 times, indicating high interest.

The above information is provided for reference purposes only and does no constitute investment advice.