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Hong Kong Utilities Performance: Hong Kong utilities have shown strong performance with QTD returns of 6-8%, contrasting with a 3% drop in the HSI, indicating their defensiveness against market volatility.

Market Expectations and Rate Cuts: Increased market expectations for a potential Fed rate cut in December align with the utilities sector's resilience, which has a low beta of 0.1 YTD against the HSI.

Company-Specific Catalysts: While existing businesses are generating stable cash flows, some company-specific catalysts, such as M&A activities and asset restructuring, have yet to materialize for companies like CKI Holdings and CLP Holdings.

Broker Preferences and Ratings: HSBC Global Investment Research favors CKI Holdings for its potential shareholder returns and M&A opportunities, followed by CLP Holdings, while maintaining a Hold rating for POWER ASSETS and HKCG due to their FCF challenges.

Strategic Cooperation: HK & China Gas and China Resources Gas Investment have formed a strategic partnership to establish a Low-Carbon Smart Gas Joint Innovation Center.

Focus on R&D: The collaboration will emphasize technology research and development across the gas industry, with a focus on AI and green transformation, aligning with China's "15th Five-Year Plan."