Love stock

Guosen Securities: The current round of the market is "strong country cattle" now ushered in a perfect configuration window

Click volume:Number of reply: 0Report 财友3f1737do Published on 2019-03-13 15:50:18

  Core conclusion

The 20-year A-share market has been deducted so far, which is beyond the expectations of the majority. I am afraid that it is not a simple "low valuation" and "good liquidity" can explain it. The "fundamental turning point" can be expected but it has not been seen in the short term. To.We believe that the biggest logic driving the market to continue to advance is "strong country cattle".Under the background of financial supply side reform, the reform and improvement of the capital market basic system, relying more on equity financing to support the real economy and technological innovation, and adhere to the industrial power. This historic process will increase the proportion of the listed company's overall asset value in the national economy, promote the relocation of resident assets from real estate to more equity, and the low interest rate era can push up the long-term valuation of equity. As an outstanding representative of the entity, the assets of listed companies will be placed on more powerful dreams in the future.

A-shares have now turned into value-for-money, and the current configuration window is ushered in. Since 2018, the valuation of all listed companies, whether they are all A shares or CSI 300, has been consistently downward. The current valuation of the A-share market is vertical and its historical data ratio, and horizontal and other global stock markets. More than, they are also in a bottom position.The current A-share has turned into a value-for-money, and the current configuration window is ushered in.

Guoxin Strategy Group Yan Xiang, Zhan Di, Xu Ruchun, Zhu Chengcheng

  Adhere to industrial power and promote technological innovation

Industry is the foundation of the country, and technology is the instrument of a strong country. The future development of China's economy cannot be separated from the establishment of the industry, and technological innovation will also support the backbone of our industrial power. Adhering to the development strategy of establishing a country, promoting the continuous innovation and progress of science and technology, and handling the relationship between finance and the real economy are of great significance to China's current and long-term economic prosperity. As an outstanding representative of the entity, listed companies are also important strategic assets of our country.

  Industrial country, technology power

The establishment of an industrial country is the fundamental foundation of a country's economic development, and China has always adhered to the strategy of establishing a country. In the 2019 government work report, it is pointed out that guiding financial institutions to expand credit supply, reduce loan costs, accurately and effectively support the real economy, and not allow funds to be idling or escaping; to serve the real economy as a guide, reform and optimize the financial system structure, and stimulate the market. The main body is energetic and strives to optimize the business environment.

The development of industry is inseparable from technological innovation and industrial upgrading. The government work report also pointed out that we must persist in innovation and lead development, and foster new and dynamic energy. We will give full play to the comprehensive advantages of China's abundant human resources and huge domestic market, reform and innovation of scientific and technological research and development and industrialization application mechanisms, vigorously cultivate professionalism, and promote the transformation of new and old kinetic energy.

Under the guidance of the strategy of China's industrial development, China's real economy has made considerable progress. Since 2005, the status of China's manufacturing industry has increased year by year. As of 2016, China's share of manufacturing industry has been leading the world. At the same time, China has been increasing its investment in scientific research and technological innovation. In recent years, the amount of R&D expenditures of Chinese companies has risen rapidly in the past year. In 2016, it invested US$182.9 billion, surpassing Japan and Germany.

But we also need to recognize the current difficulties faced by Chinese industry. China's manufacturing output is far ahead, but it still lacks the world's leading manufacturing industry. In Fortune magazine's list of the world's top 500 companies in 2018, Chinese companies occupy 120 seats, but most of them are financial real estate and resource-based enterprises, and few manufacturing companies. From the perspective of scientific research strength, there is still a certain gap between the “stock” of China's R&D investment and the world frontier. In 2016, the stock of R&D expenditure of Chinese enterprises was about 854.4 billion US dollars, which is not as good as Japan, and there is a big gap compared with the United States.

The future development of China's economy cannot be separated from the establishment of the industry, and technological innovation will also support the backbone of our industrial power. Adhering to the development strategy of establishing a country, promoting the continuous innovation and progress of science and technology, and handling the relationship between finance and the real economy are of great significance to China's current and long-term economic prosperity.

  Non-financial real estate listed companies have a low market share of GDP

Listed companies are excellent representatives of China's entity enterprises and an important strategic asset of our country. However, from the perspective of the market capitalization of listed companies in terms of GDP, the market value of non-financial real estate listed companies is not high in GDP, and it has shown a downward trend in recent years.

By the end of 2018, the market value of non-financial real estate listed companies was about 33 trillion yuan, accounting for 42.7% of the total GDP in 2018 (excluding financial real estate), far less than the proportion of 153.9% in the United States. (Note, since the value-added data of the US financial real estate industry has not been announced in 2018, the calculated 153.9% of the market value of the non-financial real estate industry in the United States at the end of 2018 / In 2018, the overall GDP of the United States, the actual 2018 US non-financial real estate listed companies will account for more than 153.9% of the market value of GDP. )

  Financial supply side reform, a new era of equity financing

Indirect financing has always been China's main financing channel, but traditional bank financing has some problems, especially in the provision of financial services to private and small and micro enterprises, resulting in poor social credit transmission, the infrastructure of the past few years. The + real estate model has clearly squeezed the credit financing of private enterprise manufacturing. With the continuous improvement of the financial supply side reform, the continuous improvement of the capital market system, the financing structure will be continuously optimized and improved, and direct financing will play a more important role. The capital market may assume a new mission to lead the development of innovative economy. Equity financing will also usher in a new era.

  Traditional bank financing has drawbacks

China's financing has always been dominated by indirect financing. The credit derivation of bank loans is still the main channel for corporate financing in China, while the proportion of direct financing is still small. Calculated according to the stock method, at the end of 2018, direct financing (bonds + stocks) The proportion of the social financing balance was only 13.1%, and the loan balance accounted for 66.8%.

However, there are some problems in traditional bank financing, especially in the provision of financial services to private and small and micro enterprises, which will cause social credit transmission to be unsmooth. On the one hand, from the safety consideration of loans, banks prefer large and medium-sized enterprises. At the same time, bank lending has higher requirements on financial information and collateral of financing parties. There are quite a few private and small and micro enterprises that do not have standards. The collateral, or because of the lack of credit data, makes it difficult to obtain funds through the bank.

On the other hand, from the perspective of the timeliness of loans, the long time for approval is also one of the reasons why small and micro enterprises are unable to obtain liquidity from banks. As the bank insists on the approval process of the large loan business and the micro-credit business, the lending period is longer, and the small and micro enterprises have urgent demand for funds, short deadlines and high frequency. Therefore, many enterprises fail to get cash flow in time. The replenishment was forced to go bankrupt; at the same time, the micro-loan business required higher manpower, time and other costs and less returns, accompanied by higher risks, which exacerbated the bank’s pity for private and small and micro enterprises. Loan situation.

  The “Infrastructure + Real Estate” model squeezes the credit financing of private enterprise manufacturing

Judging from the bank's lending to various industries in recent years, the past “infrastructure + real estate” economic model has squeezed manufacturing financing. In recent years, the loan growth rate has been split according to industry contribution. It can be found that in recent years, the contribution of infrastructure loans to the growth rate of all loans has gradually increased. In 2017, the pulling effect on loan growth rate reached 3.2%. Although the contribution of real estate and construction loans has declined slightly, the pulling effect on loan growth in 2017 is still 0.9 percentage points.

Contrary to this, the impact of manufacturing companies' loans on the growth rate of all loans fell sharply in 2014. Between 2011 and 2013, the average annual growth rate of manufacturing industry was around 3%, and after 2014, manufacturing loans. The average annual growth rate has dropped to 0.3%, and there has been almost no growth in 2017. From the perspective of loan growth, the growth rate of manufacturing loans declined rapidly in 2014, and the growth rate has dropped to around zero in 2017.

  Equity financing ushers in a new era

The 13th collective study of the Political Bureau of the CPC Central Committee emphasized that it is necessary to deepen the structural reform of the financial supply side and enhance the economic ability of financial services. The meeting stressed: "We must deepen our understanding of the international and domestic financial situation, correctly grasp the financial nature, deepen the structural reform of the financial supply side, balance the relationship between stable growth and risk prevention, accurately and effectively address key areas, deepen financial reform and opening up, and enhance Financial services, the real economic ability, resolutely play a good role in preventing and defusing major risks including financial risks, and promote the healthy development of China's financial industry."

In order to strengthen the reform of the financial supply side, “improving the proportion of direct financing, especially equity financing” is written in the 2019 government work report. The work report pointed out that "reform and improve the basic system of the capital market, promote the healthy and stable development of multi-level capital markets, and increase the proportion of direct financing, especially equity financing." .

Zeng Gang, deputy director of the National Finance and Development Laboratory, said that reforming and optimizing the financial institution system and financing structure are all areas of deepening the structural reform of the financial supply side. In the financing structure, the proportion of direct financing is low, and insufficient equity funds will restrict the growth of enterprises. On the one hand, enterprises borrowing from banks bring high debts, which further leads to high leverage. On the other hand, banks can't provide high-risk equity funds, so there will be problems of financing difficulties and expensive financing. Therefore, it is of great significance to improve direct financing, especially equity financing.

With the continuous improvement of the financial supply side reform, the continuous improvement of the capital market system, China's financing structure will also be continuously optimized and improved, and direct financing will play a more important role; the capital market may assume new development leading the innovation economy. Mission, equity financing will also usher in a new era, new opportunities.

  The era of low interest rates is coming, pushing up the long-term valuation of equity

Judging from the current economic growth rate and inflation of the Chinese economy, the risk-free interest rate that has fallen rapidly in the early stage is likely to continue to decline or even break through the historical low, and we may enter the era of long-term low interest rates. This is a major positive for the equity market, because both in theory and historical experience, the low interest rate environment will be conducive to the improvement of equity valuation.

  China may enter the era of long-term low interest rates

Since the fourth quarter of 2018, there has been an accelerated decline in risk-free interest rates. The yield on maturity of 10-year Treasury bonds fell from 3.98% at the beginning of 2018 to 3.10% at the beginning of 2019, a drop of 88 BP. Judging from the current economic growth rate and inflation of China's economy, it is very likely that the risk-free interest rate will fall further and even break down the historical low of 2.7%. The Chinese economy may enter the era of long-term low interest rates.

  Low interest rate environment is conducive to valuation improvement

The market's risk-free interest rate is at a low level, which is a major positive factor for the stock market, which will reduce the discount factor of the denominator, which will lead to the revision of the stock market valuation. Judging from the historical valuation of the Shanghai Composite Index, the low interest rate environment will also help to upgrade the equity valuation in most cases, with only exceptions in 2003. The yield of the US 10-year Treasury bond also showed a significant negative correlation with the valuation of the S&P 500 index.

The main reason for the downgrade of the Shanghai Composite Index in 2003 was that the monetary policy triggered by the overheated market economy turned to expectations. From the end of 2002 to the beginning of 2003, industrial added value and PPI surged year-on-year, hot money continued to flood in, and the market's expectations for policy tightening continued to heat up, resulting in the valuation continued to decline in a low market interest rate environment.

  Resale of resident assets, from real estate to equity

We believe that in the process of deepening the reform of the financial supply side, it will inevitably be accompanied by the shift of the asset allocation of the real estate from the real estate to the financial assets as the main body, especially the allocation of equity assets. The main logic is as follows: (1) The proportion of financial assets allocation in China's residential sector is far lower than the international level. The main reason is that real estate accounts for a large part in China's household asset allocation; (2) under the policy of housing and housing, the current real estate is in a down cycle. The “capital gain” return rate of houses began to decline, and the attractiveness of investment decreased. (3) The rapid decline of the yield of wealth management products at the same time will greatly highlight the allocation value of equity in financial assets; (4) current equity assets In the value of the land, ushered in a perfect configuration window.

  The proportion of China's family financial assets allocation is too low, and the room for improvement is relatively large.

  Compared with the international advanced economies, China's household financial assets allocation is far behind.According to the China Household Finance Research and Research Center, as of 2017, China’s household financial assets allocation accounted for only 12%, while Japan’s household financial assets allocation accounted for 61%, and developed in Singapore, Switzerland, the United Kingdom, and the United States. The proportion of national household financial assets allocation is also above 40%. In other words, compared with the international economies with developed capital markets, China's household financial assets allocation is far behind, and there is room for improvement.

  Real estate accounts for a large part of China's household asset allocation.By comparing the breakdown of family assets between China and the United States, we can clearly see that real estate has a core position in China's household assets, accounting for 78% of the total, while the corresponding data for American households is only 38%. High favor greatly squeezed the allocation of financial assets.

  "Do not live in the house," the policy does not support the property is still the main investment

  Under the policy of housing and non-speculation, the current real estate is in a down cycle, and the “capital gain” return rate of houses has begun to decline, and the attractiveness of investment has decreased.At the end of 2016, the Central Economic Work Conference first proposed that “the house is used for housing, not for speculation.” After that, the real estate industry regulation policy set the main tone. We believe that under the policy of housing and housing, the investment demand of real estate will inevitably be restrained accordingly, and the continuous decline in the sales area of ​​commercial housing also indicates that the current real estate demand is in the down cycle. On the other hand, under the policy control, the growth rate of housing prices has begun to return to rationality and maintain a low level. This means that the “capital gain” return rate of housing has begun to decline, and the attractiveness of investment has decreased. Therefore, on the whole, we believe that the current policies do not support the future of the property as an investment entity.

  Interest rates quickly fall, and the value of equity asset allocation is highlighted

The rapid decline in the yield of wealth management products will greatly highlight the allocation value of equity in financial assets. Since 2018, the annual wealth management products represented by Yu'ebao and WeChat Licai and the annualized rate of return of bank wealth management products have been in the downward channel. As of February 17, 2019, Yu'ebao and WeChat's annualized rate of return Only 2.6% and 2.9%, and the annualized rate of return on bank 1-year wealth management products also fell to 4.4%. Undoubtedly, the rapid decline in the yield of wealth management products will greatly highlight the allocation value of equity in financial assets.

  Equity assets are at a low value, and the best configuration window is ushered in the moment.

  A-shares have now turned into value-for-money, and the current configuration window is ushered in.Since 2018, the valuation of all listed companies, whether they are all A shares or CSI 300, has been consistently downward. The current valuation of the A-share market is vertical and its historical data ratio, and horizontal and other global stock markets. More than, they are also in a bottom position. The current A-share has turned into a value-for-money, and the current configuration window is ushered in.

 

Post Reply

*content:
expression: smile laughing out loud Flowers anger Cry Helpless sweat pain sinister smile Madness Was flat Soy sauce push ups Cutting meat despise Bear Cattle rise
Author:
username Password 5 seconds registration

The post you have seen recently

Hot stocks

Financial sector
respected user:

In order to provide a more harmonious, healthy and effective communication environment for the majority of shareholders, if you find any violations of national laws and regulations, please contact us in time with the financial sector management administrator. You are welcome to provide valuable comments and suggestions.

Financial Customer Service Center Email: xin.li@jrj.com.cn

Love stock customer service phone: 010-5832 5349