Category: Money tips Release Date: 2007-04-28
Strong growth in earnings of listed companies, equity valuation of listed companies after the split level rise, yuan appreciation of the three major factors that will drive the A-share market continues upward, the central market in 2007 than in 2006 increased about 40%
Now it is difficult to judge what time the market will fluctuate.
However, according to the experience of overseas markets, the introduction of stock index futures, often lead to market volatility
Entered in 2007, China's capital market better and better, is expected to usher in sustainable development. After years of market-oriented operation, an efficient capital market in China has taken shape; the success of split share structure reform will promote its own listed companies have a strong entrepreneurial spirit; while no cycle of growth in China's economy is bound to listed companies fully share the fruits of economic growth. As a result, we judge that the central market in 2007 than in 2006 significantly increased, but in different industries, different governance structure of the company, its valuation would be a major differentiation. In addition, the funds are too violent to promote most likely lead to a time in 2007 the market volatility. From the asset allocation point of view, our overall recommendations are: consumer sector super-distribution, the investment sector neutral, with lower export sector. At the same time in 2007, should be actively looking for "atypical" growth opportunities.
Significantly improve the efficiency of capital markets The efficiency of China's capital market have significantly increased in recent years, efficient capital market has shown signs of taking shape. Efficient capital markets characterized by resources (capital) has been optimized configuration, the optimum allocation of resources is reflected in three aspects: first, the fund's investment return rate is much higher than the market average; second, good size of the fund increased significantly ; Third, the best valuation of listed companies significantly increase the market valuation gap began to widen.
2006, an important market characterized by the level of valuations began to differentiate, both less than 10 times the P / E stocks, there are up to 50 times the stock, while a few years ago, almost all of the stock valuation less the same. In 2006 rose over 100% of the stock are 452, 138 stocks rose more than 200%, while the 41 stock price dropped more than 10%.
Capital market is the market Split share structure reform, is China's capital market is a sign of the market, the capital market is a prerequisite for optimal allocation of resources. Split share structure reform, successfully completed, will have the following significance:
First and greatly enhance our management level of enterprises. -Floating era, with the implementation of equity incentive system, management truly become an agent of the assets of shareholders in order to achieve the interests of shareholders, entrepreneurs and the interests of consistency, interest-oriented enterprises into shareholder value maximization.
Second, to improve the overall valuation of the level of the capital market. With the state-owned enterprise equity incentive system, enacted in 2007 equity incentive system will be pushing a large area. The implementation of equity incentive system, the listed company's future performance is more predictable, investors have more confidence in the future, corresponding to the level of stock valuations rise.
Third, promoting China's economic efficiency. From a more profound sense, full circulation of the securities market will greatly enhance China's economic efficiency. Increase the efficiency of listed companies, first of all save the social capital, improve the ROE level; Second, listed companies must step up technology development, improve the competitiveness of enterprises.
2007 market center will be substantially upward We believe that, despite the A shares after 2006 from start to finish, Guanjue strong global rise in the capital market in 2007 will not be similar to the 1993 and 1996, after the great bull market of the huge adjustment, because the basis of the capital market has this non - Xi-ratio, capital markets have been able to achieve sustainable development.
We believe that the strong growth in earnings of listed companies, equity valuation of listed companies after the split level rise, yuan appreciation of the three major factors that will drive the A-share market continues upward, the central market in 2007 than in 2006 increased 40%.
Valuation increases will follow two clues: Industry clues and corporate governance leads; both have in common is that performance predictability is stronger, the market can accept the higher valuation levels.
Industry clue: continued growth in types of trades, P / E levels will be getting higher and higher, such as banking, food and beverage, commerce and trade, catering and tourism, the market can accept the P / E should be 30 times or more; and cycle classes, low-growth categories industry, its valuation should be 20 times the P / E below.
Governance structure of clues: the implementation of a complete equity incentives company, its valuation should be raised above 30%.
A people's appreciation will help to further improve the level of stock valuations. Appreciation of the renminbi, directly increasing the attractiveness of A shares for the QFII, a variety of foreign capital through various channels to increase its investment in A shares.
So severe that funds can be induced volatility Although we believe that the market value of the central file will be moved, but too fast a particular time if the funds to promote the stock to run if the deviation from the normal track, the market volatility could still produce.
The starting point for the market in 2007 has not been low, the market there is profit-taking pressure. However, due to the wealth effect in 2006 is very strong, new investors will continue to enter the market; the beginning of this year, major commercial banks, credit funds will increase the injection, the enterprise's operating funds will be particularly abundant, so a quarter of ample supply of funds, thereby adding additional risk to the market.
Now it is difficult to judge what time the market will fluctuate. However, according to the experience of overseas markets, the introduction of stock index futures, often lead to market volatility.
The opportunity to focus on non-traded sectors From the fundamental point of view, investment opportunities in 2007 are still concentrated in the non-traded sector, consumer, services should be able to easily access the excess proceeds; trade sector, only the machinery and equipment industry has a certain appeal.
In 2007, to be careful to invest in the trade sector, mainly two aspects of uncertainty, one of the global economy will fluctuate, especially in the second half of 2007, the possibility of increased volatility in the global economy; second, RMB appreciation rate is 3%, 5%, or 7%? You know, 3% and 7% of the appreciation rate for the foreign trade sector is a big difference in the impact.
"Atypical" growth opportunities Due to market activity, investment opportunities will spread, the original traditional top-down factors that drive consistent performance is expected to increase (or so-called "typical" growth, such as China Merchants Bank), may gradually spread to the valuation of individual event-driven sudden increase in the level, which we call "atypical" growth.
2007, "atypical" growth opportunities are mainly three: participation in IPO (as well as re-finance), asset reorganization, futures and options.
Participation in IPO, as well as refinancing. Refinancing in 2006 has given investors a lot of investment opportunities, such as the Industrial and Commercial Bank of China, Air China, while in 2007 there will be more and better new shares in A-share market, such as China Life, PetroChina , China Mobile, Ping An Insurance, and some stocks or sectors to fill the gaps in the domestic market varieties.
Reorganization of assets. Expected long-term bull market, the asset reorganization will be an important investment theme. Asset reorganization is an important reason is that some enterprises in accordance with regulatory standards can not reach the current IPO market conditions, but investors have been able to bring tangible return on investment, so the backdoor listing, the typical image of the securities company; other , in the full circulation and promotion of equity incentive system, the company's management to improve returns on assets will increase the assets restructuring efforts.
Futures options. Maotai listed since 2001, the date, using a five-year period rose 10-fold, while the Wuliangye warrants from the listing date, month and a half on the up 10 times. Futures, options and other derivative products, rich, will greatly improve the efficiency of investment as "atypical" growth of a powerful tool.
