Guotai Junan strategy: “steady growth” market is still on the way value will still stage dominance

2022-06-26 0 By

Guotai Junan strategy Chen Xianshun research team’s latest research report pointed out that since the central Economic Work Conference at the end of 2021, “steady growth” has been the focus of the market.The inflection point of global liquidity has been reached, and the asynchronous window period of Monetary policies in China and the US is narrowing. As a result, the valuation end does not have the basis for an overall rise, so we should focus on the direction with valuation repair.Starting from DDM model, we should pay attention to the profit reversal or marginal improvement at the molecular end.The current low valuation sector with consumption and infrastructure chain as the core has these advantages, “steady growth” market is still on the way.Overall, the current low risk appetite in the market, the economic fundamentals are still not realized, the value will still be dominant stage, and growth, especially the opportunity of track companies still need to wait for the recovery of risk appetite.1) Infrastructure: coal/steel/transportation/construction/chemical – infrastructure real estate/machinery and equipment;2) Consumption: agriculture, forestry, animal husbandry and fishery (pig)/ home appliances/consumer services;3) Finance: securities firms and banks;4) Consumer electronics.