With so much attention on AI stocks in Hong Kong and China now, this is the perfect time to look for small-cap gems in China.

And if you know us, we love stocks that are undervalued and cheap.

So, anything with price-to-earnings (P/E) ratio that is below 10 times, and decent yields are all fair games to us.

Cheers,
InvestKaki Team 🤜🤛

Moving on, here are the news that shocked the world…

Amazon $AMZN ( ▲ 0.34% ): Amazon is buying Globalstar, a satellite internet business, for $11.57 billion as it seeks to compete with Elon Musk’s Starlink. [Read More]

Oracle $ORCL ( ▼ 1.84% ): Oracle and Amazon is expanding their deal for work on multicloud networking to increase connectivity between Oracle Cloud and AWS [Read More]

PepsiCo $PEP ( ▼ 0.45% ): PepsiCo’s 1Q results exceeded expectations. Revenue and profits are up by 8.5% and 27.3% respectively as price cuts on Lays and Doritos increased volume [Read More]

Morgan Stanley $MS ( ▲ 0.8% ): Morgan Stanley top estimates. Revenue is up by 16% driven by its equities trading, investment banking and wealth management segments [Read More]

Netflix $NFLX ( ▼ 9.72% ): Netflix co-founder and chairman, Reed Hastings is stepping down from the board in June when his term expires. [Read More]

Here are the news covering the Asia market…

TSMC: TSMC’s results have beaten expectations. Profits are up by 58% drive by demand for advanced chips by AI clients as it now accounts for 75% of wafer sales [Read More]

Singapore Economy: The Singopean economy recorded a lower growth of 4.6% for 1Q 2026 compared to 5.7% and could slow further due to the Iran-US-Israel conflict [Read More]

Geo Energy Resources: Geo Energy has raised SG$18.4 million by placing out new shares to Asdew Acquisitions, Ascend Open Master Fund, Icham Master Fund [Read More]

Aspial Lifestyle: Aspial’s revenue and profits are up by 48% and 140%, driven by strong demand for its pawnbroking business [Read More]

Envision AESC: Envision AESC, a major lithium ion manufacturer and backed by GIC, is planning for an IPO on the Hong Kong market [Read More]

AI isn’t a tech trend – it’s a full-blown, multi-trillion dollar race, and 10 companies are already pulling ahead.

These are the innovators driving real revenue, attracting institutional attention, and positioning for massive growth.

Get all 10 tickers in The 10 Best AI Stocks to Own in 2026, free today.

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The Big Pharmas taking over the market!

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SAS Dragon provides design, development, sourcing, logistics and quality assurance services of electronic and semiconductor components. Sales of electronic components and semiconductors make up 99% of its revenue in 2025.

Why we like this: There are two major factors that we like. Valuation for the company is very cheap now, at a price-to-earnings ratio of 5.7 times. Its peers are trading at an average of 11.4 times. Discounted cash flow (DCF) also indicates that the company is potentially undervalued by 92%.

Furthermore, this is an attractive dividend play. Dividend yield is high at 7.9%. We do think that the company is currently flying under investors’ radar. According to Gartner, it is top 12 in the world as a global distributor.

Its financial performances have also been strong in the past couple of years. 2021 was its peak year before it declined till 2023. Since then, the company has made a comeback.

We are also positive on its involvement in the AI industry. Many of its components it sells are used by is AI clients. 2025 revenue was up by 10% due to higher demand data centre infrastructure and AI-related system.

China Bohai Bank provides personal and corporate banking products and services in China.

Why we like this: Banks in China are boring. And that’s good. Highly regulated but highly protected by the Chinese government. Revenue has declined for 4 years straight from 2020 to 2024, but finally recovered in 2025.

Valuations are very cheap at a PER of 2.5 times, compared to its peers’ average of 7.5 times. DCF valuation also indicates a potential undervaluation of 35%.

Anton Oilfield Services Group is an integrated oilfield technology services, providing oil & gas exploration services.

Why we like this: Valuations are cheap also. PER is at 7 times compared to its peers’ average of 48.9 times. DCF valuation indicates a potential undervaluation of 87%.

Anton Oilfield represents a proxy into the oil & gas industry but from Hong Kong’s stock market. But due to the conflict in the Middle East, the company’s share price has been battered down due to one-third of its orderbook in Irag (the other two-thirds are in China).

Share price declined by 18% from its peak of HK$1.32 on 3 March to HK$1.08 on 17 April.

Daphne International distributes and sells footwear products and accessories in Mainland China.

Why we like this: Daphne represents a company that is currently riding the change in consumer trends in China. Revenue has quadrupled in just four years from RMB86 million in 2021 to RMB364 million in 2025.

And it is currently trading at cheap valuations of PER of 6.2 times. Investors in Hong Kong and China are turning their attention to AI-related stocks and have exited consumer-related ones.

This represents a good opportunity to grab an up-and-coming footwear company that rides the quick-changing trends in China.

Dividend yield is also decent at 4.8%. DCF valuation indicates 54% potential undervaluation.

Chengdu Expressway develops, owns and manages expressways and highways in Mainland China.

Why we like this: Bread-and-butter infrastructure company in China. They are stable and will always have a regular contracts of expressway construction.

It is currently trading at a PER of 5.4 times, with a dividend yield of 6.7%.

And that’s a wrap!

Cheers,
James Yeo~