Category: Money tips Release Date: 2006-10-27
Source: Industrial Securities Author: Zhang Yi-dong
International experience reminds us that the currency appreciation associated with the proliferation of liquidity can not be effectively reversed by tightening policy, but should take the initiative of the excess liquidity reasonable ease. We believe that the future of funds into the stock market will gradually relax the restrictions.
We should be based on long-term bull market, choose the growth of long-term holding, while the growth of enterprises mainly include: IT-related technology industries, with a cyclical growth industry, consumer and service industries and so on.
6,7 months of financial institutions in Waihuizhankuan 400 billion, 190 billion, we predict that the next few months Waihuizhankuan increase will be greater, the problem of excess liquidity will be more prominent. An obvious example, the current inter-bank money market interest rates over the benchmark variety R007 was down by nearly 50 BP.
We believe that after the share reform urgent need to accommodate the development of China's stock market is the best channel for excess liquidity. At present, the size of China's securities market too small, unable to meet the huge size of China's economy asset allocation needs, which was mainly due to China's capital market in previous years, many institutional shortcomings, A-share market development and economic development deviated from. According to the Securities of the rate indicator, that is, various types of securities the total market value of a country with the country's gross national product ratio of the securities of developed countries in Europe and the United States the rate is usually around 100%, while China has been maintained at below 50%, or even just the end of 2005 of 20%.
To enhance market-based rates, developing the local stock market, not only to change the long-standing pattern of excessive dependence on bank credit, so that China's financial market more healthy, safe; and able to optimize the allocation of resources, to promote industrial development and the capital of the positive interaction and stimulate scientific and technological innovation ability improvement and sustained economic development.
And to enhance market-based rates, you need to stock market size has grown faster than GDP growth rate, that is, more than 9%, regardless of the expansion of this size is based on stock prices or the incremental increase in the assets. A-share market as a whole in the current price-earnings ratio of around 23 times the level has been the case, relying on the existing listed company can not effectively expand the depth and breadth of the market, but also difficult to continue to promote the market's prosperity. Therefore, the development of the stock market into the inevitable need for new assets, and market expansion is a huge demand for capital.
We believe that the tape will be macro-regulation and expansion of the short-term shocks and long-term bull market in appreciation of the RMB is expected to trend upward under the shock. Therefore, we should be based on long-term bull market, choose the growth of long-term holding, and choose a reasonable valuation of the blue chips to circumvent the risk of short-term adjustment.
For the quantitative analysis of growth, we use the main indicator is the net return on assets ROE. ROE increase (or decrease) will result in equity capital has a higher (or lower) the profitability, which led to a higher (or lower) growth rate. We are a listed company in recent years statistics ROE changes mid-year report, and based on 2006 mid-year report rates of change in ROE compared to 2005 were sorted, we have found, computer application services in mid-2006 to enhance the rate of ROE largest increase of 5.5 compared with 2005 percentage points, completely reversing the decline in the situation in previous years. ROE increase in mid-2006 a significant reduction in other industries are food and beverage industry, machinery and equipment, instruments, finance, communications and related equipment.
We believe that, ROE data to us to find the direction of growth of the sex industry, growth company focused on the following areas:
The first IT-related technology industries. We believe that current technology industry already has a strong endogenous and exogenous driving force for development, especially in the software, communications, industrial chain, a new type of electronic components and other technology industry, there will be outbreaks of growth, the existing listed companies will have opportunities.
2 is a cyclical growth industry, such as: national policy support to benefit from the advanced equipment manufacturing, railway-related industries, environmental protection, new energy-saving as well as the next stage of the energy industry boom is expected to recover the steel, automobile auto parts industry. We are particularly optimistic about the railway-related industries, not only because the "Eleventh Five-Year" period to 1.25 trillion yuan in rail investment in fixed assets, but also because China's per capita GDP for the rapid growth of transport demand generated by the rail with highways, air can not match safety, and are subject to the constraints of a smaller energy bottleneck.
Third, consumption, services, environmental protection and new energy sector. With the upgrading of China's per capita GDP levels, it is for the basic necessities (food and beverage, real estate, tourism, hotel, car, etc.), health care (especially traditional Chinese medicine), financial services, business, media and other emerging social service, etc. consumer services industry has a higher demand for, and for sewage treatment, air treatment, desert control, as well as wind, solar and other new energy sources are also more demanding, thus related industries has brought greater opportunities for development.
