Analysis of Popularity for Dazhong Public Utilities (01635.HK): Southbound Capital Preference and Performance Drivers

Dazhong Public Utilities (01635.HK) recently made it to the East Money App Hong Kong Stock Popularity List, and its popularity stems from the combined effect of multiple factors. The company’s 2025 Q3 net profit increased by 2.88 times year-on-year to 187 million RMB [0], and the strong performance provided fundamental support for the stock price. Sustained inflow of southbound capital is another core driving factor; the Hong Kong Stock Connect shareholding ratio of this stock reaches 69.45%, ranking among the top three in Hong Kong Stock Connect shareholding ratio [1][4], reflecting mainland investors’ recognition of its long-term value. In addition, the company won the ESG Pioneer Award [0], which aligns with the current market’s preference for sustainable investment, and the public utilities industry received key policy support in the new energy and environmental protection fields in 2025 [5], further enhancing its investment appeal. It is worth noting that the stock has recently seen a 5% price drop [3], which may reflect short-term profit-taking or market sentiment fluctuations, but does not change the long-term positive fundamental logic.

1. Synergy between Southbound Capital and ESG
   : The high southbound shareholding ratio (69.45%) and ESG certification form a positive cycle; institutional funds tend to allocate to ESG targets that are policy-aligned and have stable cash flows [1][5].
2. Quality of Performance Growth
   : The Q3 net profit surge not only comes from business scale expansion but also reflects the company’s achievements in cost control and operational efficiency improvement [0], which is particularly valuable in the regulated public utilities sector.
3. Resonance of Industry Policies
   : The investment logic of public funds is tilting towards thematic investment [5]; as a core sector supported by policies, public utilities are expected to continue to receive capital attention.

• Short-term price fluctuations: The recent 5% drop indicates possible uncertainty in short-term market sentiment [3].
• Changes in regulatory policies: Adjustments to the pricing mechanism of public utilities may affect the company’s profit stability [0].

• Policy dividend window: Policy support in new energy and environmental protection fields will provide space for the company to expand its business [5].
• ESG premium potential: With the deepening of ESG investment concepts, the company is expected to obtain a valuation premium [0].

The popularity of Dazhong Public Utilities (01635.HK) is the result of the combined action of fundamentals, capital flows, and policies. Strong Q3 performance, high southbound shareholding ratio, ESG certification, and industry policy support constitute its core competitiveness. Although there has been a short-term price adjustment, the long-term investment value is still recognized by institutions. Investors should pay attention to the sustainability of subsequent performance, the progress of policy implementation, and changes in southbound capital flows.