Hong Kong tech stocks declined further, with Alibaba (09988.HK) and Kuaishou (01024.HK) down over 3%, and Xiaomi (01810.HK) nearly 2% lower

Hong Kong tech stocks declined further, with Alibaba (09988.HK) and Kuaishou (01024.HK) down over 3%, and Xiaomi (01810.HK) nearly 2% lower

Hong Kong tech stocks experienced a significant decline on September 2, 2025, with Alibaba (09988.HK) and Kuaishou (01024.HK) both down over 3%, and Xiaomi (01810.HK) nearly 2% lower. This downturn comes amidst ongoing market volatility and the recent strategic spin-offs by Alibaba, including the IPOs of Quicktron Robotics and Banma Network Technology.

Alibaba's spin-off of Quicktron Robotics and Banma Network via Hong Kong IPOs aims to focus the company's core competencies on AI and cloud computing while enhancing financial flexibility. Quicktron Robotics, backed by over $100 million in funding, targets the $20 billion global warehouse automation market but faces stiff competition from Amazon and high R&D costs for global expansion [1]. Banma Network, on the other hand, seeks to accelerate autonomous driving R&D through partnerships with BMW and SAIC despite a $220 million net loss in Q1 2025 [2].

The decline in Hong Kong tech stocks may be attributed to several factors. Firstly, the recent IPOs of Quicktron and Banma have raised concerns about the long-term viability and alignment of these spin-offs with global trends in automation and smart mobility. Secondly, market sentiment has been influenced by expectations of US interest rate cuts, which have repeatedly caused international capital flows to exacerbate market turmoil [3]. Additionally, the ending of southbound capital profits has further contributed to the market volatility.

Investors must weigh the long-term potential of AI and robotics against short-term financial risks. Rising interest rates could pressure valuation multiples, while regulatory scrutiny in China’s tech sector may delay approvals. Despite these challenges, Alibaba’s spin-offs represent a calculated bet on the future of automation and smart mobility. Quicktron’s warehouse robotics and Banma’s autonomous driving solutions are well-positioned to benefit from secular trends, but their standalone success will depend on execution.

Looking ahead, the Hong Kong stock market is expected to continue its upward trend, driven by strong capital inflows and the Federal Reserve's interest rate cut cycle. The tech sector, particularly with lower valuations and better fundamentals, is expected to continue to be favored by foreign investors. The deepening reform of the Hong Kong stock listing system is also anticipated to further improve the quality of market assets and liquidity [3].

In conclusion, the recent decline in Hong Kong tech stocks is a result of market volatility and the strategic spin-offs by Alibaba. While the long-term potential of these spin-offs remains promising, investors must carefully assess the risks and opportunities presented.

References:
[1] Alibaba-Backed Robot Firm Quicktron Is Said to File for Hong Kong IPO [https://www.bloomberg.com/news/articles/2025-09-02/alibaba-backed-robot-firm-quicktron-is-said-to-file-for-hong-kong-ipo]
[2] Alibaba's Banma IPO: A Strategic Spin-Off and New Opportunity in China's Autonomous Driving Sector [https://www.ainvest.com/news/alibaba-banma-ipo-strategic-spin-opportunity-china-autonomous-driving-sector-2508/]
[3] Hong Kong Stock Market Opening All Three Major Indices [https://news.futunn.com/en/post/61637148/hong-kong-stock-market-opening-all-three-major-indices-of]