On May 26, SMIC (00981.HK) surged 12.65% in regular trading, trading at HK$90.05 per share with turnover of approximately HK$3.978 billion, extending its record-breaking momentum from the prior session.

The rally is driven by multiple catalysts. On May 25, Huawei officially unveiled the Tao Law at the International Circuits and Systems Symposium in Shanghai, marking China's first globally proposed principle guiding semiconductor industry development. Based on this law, Huawei has successfully designed and mass-produced 381 chips over the past six years, with a new Kirin mobile chip adopting logic-folding technology expected this autumn. Additionally, Morgan Stanley raised SMIC's target price 21% to HK$85, reiterating an Overweight rating, citing AI-driven demand spillover benefiting mature-node foundries with EPS estimates lifted 10-14% for the next three years. Separately, CSRC approved SMIC's RMB 40.6 billion share-based acquisition of the remaining 49% stake in SMIC North, the largest M&A transaction in STAR Market history, completing in just 9 days from board approval to regulatory clearance.

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