A-share deep V reverse public offering debate on high valuation structural opportunities

 A-share deep V reverse public offering debate on high valuation structural opportunities

The Shanghai Composite Index fell more than 2% in the morning trading of the 23rd, but it was forced to stop falling and recover. Long money again poured into the hot plate, the military plate concussion upward, and finally ranked the top of the industry plate with an increase of 4.43%. In addition, biological products, pharmaceutical business and other sectors also received large capital intervention in the afternoon, and finally achieved a rise of about 2%. According to Dongfang fortune data, the biological vaccine sector received a net inflow of nearly 1.4 billion yuan of main funds, and the main capital intervention of aircraft carrier concept, monoclonal antibody concept and other sectors was more than 1 billion yuan.

According to the performance forecast of 2020 semi annual report disclosed by A-share listed companies, the performance of manufacturing enterprises such as automobile and electrical equipment improved significantly, the performance of medical and technology sectors rebounded, and the performance of consumer industry remained stable. On the whole, structurally, there are still quite a number of industries in the macro-economy that need to be fostered. In the global liquidity to maintain a loose environment, the recovery of the A-share market is likely to continue

Liu Su, deputy director of research in the stock investment department of Jingshun Great Wall Fund, said he was optimistic about the stock market for a period of time in the future. On the one hand, domestic enterprises have gradually recovered from the impact of the epidemic and their profits have improved; on the other hand, the liquidity environment of the financial market is still relatively friendly, which has a greater support for market valuation.

Chuang Jin Hexin fund also said that the current economic recovery trend is established, and the cycle plate takes the lead. It is expected that the market will maintain the plate rotation pattern supported by macro factors. We can pay close attention to the epidemic situation, vaccine research and development progress, enterprise financial report and other factors.

Anchor in valuation

However, some fund managers believe that virtual high valuation is a static perspective. For the growth industry with high momentum, if the time is a little longer, the sustained growth of enterprise performance will digest the short-term overvalues and return to the valuation anchor.

Cai Songsong, fund manager of noan growth hybrid fund, said that this round of technology growth cycle is driven by 5g industry cycle and domestic substitution. On the one hand, at present, the science and technology industry is at the turning point of the large cycle of the total upward and share increase. The leading companies have high ceiling and large space, and other factors that affect the stock price are superimposed. As reflected in the capital market, the relevant target will indeed have the phenomenon of short-term overheating of continuous pursuit of funds.

Cai Songsong believes that in the long term, scientific and technological innovation is an important weapon to help Chinas science and technology take-off. With the arrival of the peak period of 5g communication terminal construction, the business cycle of science and technology industry has just begun. At present, the static valuation of these stocks may be on the high side, but if we switch to next year or the following year, their performance growth will digest the valuation very quickly and basically reach a new steady-state valuation.

There are also fund managers who believe that the stock price is a kind of expectation for the future growth of enterprises, and good companies are not cheap is also a kind of normal. For leading companies with good growth, there will be a regression phenomenon of release of performance - lower valuation in stages, but it is unrealistic to expect them to go down to the valuation level of financial blue chip and other industries.

Layout of structural opportunities

In terms of future market layout, fund managers believe that valuation should match the boom and seek structural opportunities in their respective ability circles.

According to China Merchants Fund, the future market needs to closely follow the two cores of industry prosperity and valuation matching, look for structural opportunities with a positive attitude, focus on the post cyclical real estate consumption, undervalued finance and construction sectors in Pro cyclical industries, and select the consumer, pharmaceutical and technology sectors carefully.

Cai Songsong said that in the next investment in science and technology growth stocks, he will continue to focus on the high business cycle technology track with a top-down investment framework, and select excellent leading companies following the industrial logic. In the process of the companys growth, there will be a variety of factors. In the investment, we should have insight into the details of the target from the perspective of the big pattern, that is, while grasping the development rhythm of the industrial cycle, we should continuously track and deeply understand the technical barriers and product moat of technology stocks

Source: Ren Hui, editor in charge of China Securities Journal_ NBJ9607