The storage concept rebounds collectively! Institutions are optimistic about Q2 performance. Lianliang Technology and Zhaoyi Innovation both rose over 7%.

Cailian Press April 1 (Edited by Hu Jiarong) Benefiting from a reversal in market views on memory chips, related Hong Kong stocks collectively surged. As of the time of publication, Zhanqi Technology (06809.HK) was up 10.39%, and Zhaoyi Innovation (03986.HK) was up 7.81%.

Notably, leveraged ETF products performed especially strongly: Southern 2x Bull Samsung Electronics (07747.HK) rose 28.01%, and Southern 2x Bull Micron (007709.HK) rose 21.26%.

This strong performance echoes the broad rise in U.S. memory-chip stocks overnight, with SanDisk up nearly 11% and Micron Technology up nearly 5%.

In its latest research report, a JP Morgan analyst for the Asia-Pacific semiconductor sector said that the current decline in the memory-chip sector is essentially the result of a “disconnect between sentiment and fundamentals.” He believes the memory industry is in a strategic transition period from the “rapid expansion of infrastructure” phase to a more “refined optimization and profitability-quality” phase.

He noted that although there is a lack of clear catalysts in the short term and the risk-reward ratio is not particularly attractive, valuations over the medium to long term have become significantly appealing. Memory stocks are currently trading at only 1.1x the expected price-to-book ratio for fiscal year 2027, with a price-to-earnings ratio range of 2 to 6x. Based on this, JP Morgan maintains an “Overweight” rating on Samsung, SK hynix, and Kioxia, and recommends investors build positions on dips.

The report provides a professional assessment of the TurboQuant technology threat that has raised market concerns, concluding that its impact has been overstated. The technology is more likely to work by “optimizing system-level efficiency” rather than “reducing memory consumption.” At the same time, foreign shareholding data shows positive signals: Samsung’s foreign ownership ratio of 48.6% hit a new low in nearly a decade, and SK hynix at 53.1% is also in a historical low-range.

JP Morgan also pointed out that in the next one to three months, three core factors may become key turning points that reverse the current market pessimism:

First, the performance of cloud providers’ AI business will validate the rationale for hardware investment. In the upcoming April-May earnings season, whether major cloud providers’ revenue growth in AI can continue to support their anticipated hardware capital expenditures will be the focus of market attention.

The market’s main concern is that cloud providers’ expected growth rate in hardware investment will sharply slow from 65% in 2026 to 15% in 2027, while the overall growth rate of the memory industry market size will also drop significantly from 226% in 2026 to 33% in 2027. If cloud providers’ AI revenue and order data exceed expectations, this worry about a “cliff-like deceleration” would be substantially alleviated.

Second, the evolution of HBM technology will reshape the industry’s supply-demand balance. Changes to the configuration volume of HBM memory in servers in 2027, along with the shipment progress of ASIC chips, will directly affect the magnitude of the supply-demand gap in the memory industry. Although the market generally worries that memory prices have already peaked, positive signals have already been transmitted on the supply chain side: there is room for an increase in demand for GPU servers, and the ASIC product lines are also continuing to expand. Regarding market-circulated news that NVIDIA’s Rubin Ultra GPU chip plans have been reduced in scale, JP Morgan analysts believe the actual impact on HBM memory usage will be negligible.

Finally, long-term supply agreements will reshape the industry’s valuation framework. Micron Technology has already announced the first long-term supply agreement with its strategic customer, and the market is closely watching whether Samsung and SK hynix will follow with similar arrangements. Investors are not truly focused on the agreements themselves, but on the cycle-bottom protection mechanisms contained within them—including minimum price guarantees, capacity commitments, prepayment arrangements, and breach and compensation clauses. If these protective clauses are designed properly, the memory industry’s valuation framework could undergo a fundamental reassessment.

Previously, memory-chip-related stocks declined due to demand

Driven by end-market demand, recently, memory-chip-related stocks generally pulled back. Taking Zhaoyi Innovation and Zhanqi Technology as examples, both companies fell by more than 6% yesterday.

On the news side, since last week, spot prices for DDR5 memory modules have shown clear signs of easing. For example, for mainstream 32GB DDR5 memory modules, last week’s market quotes were generally maintained around 3000 yuan per module, while this week’s quotes have been reduced significantly by 500-1050 yuan, depending on the case. Some merchants disclosed that inventory clearing prices have already dropped to as low as 2500 yuan per module, and some distressed-sell quotes have even reached 1950 yuan per module.

In response to this, TrendForce’s latest memory price survey shows that in the second quarter of 2026, DRAM fabs will actively adjust their capacity structure, focusing on HBM and server application areas, and adopt a “backfilling” strategy to narrow price gaps among different product types.

Although the end-market faces risks of downward revision in shipment volumes, the firm expects that the overall contract prices for mainstream DRAM will still achieve 58-63% quarterly growth. In the NAND Flash market, AI and data-center demand continues to dominate the price trend. The chain-link price increase effect across the full product line is significant, and it is expected that the overall contract price in the second quarter will rise by 70-75% quarter over quarter.