Wang Delun Industrial Securities

Wang Delun believes that in the Year of the Ox, the market as a whole will fluctuate upwards, the fundamentals are generally stable, and the domestic industry will recover in an echelon style. In the Year of the Ox, service consumption is expected. He said that the beginning of the year is an important time for investment. At this time, the fundamentals continue to rise, the domestic and foreign economies are improving, and the boom is expected to be a beneficial direction to replenish inventory. When economic growth turns its head down, liquidity will gradually become the focus of the market. Its expected improvement is expected to provide investors with a better buying point. At this time, the direction of liquidity benefits is worthy of attention. At present, whether the valuation of A-share blue-chip stocks is too high has caused concern. Wang Delun said that if purely from a local and short-term perspective, the valuation center of core assets has increased to a certain extent compared with the past, and there is a risk of valuation fluctuations in the short term. But from a global and long-term perspective, due to loose global liquidity, various asset valuations are not cheap.

“The valuation of A-shares that are still high in growth is not outrageous internationally.” Wang Delun said that as the A-share market matures, core assets are already on the way, and China’s core assets are worldwide. All are scarce and become the best “not for sale” to resist depreciation in the QE era. Wang Delun also believes that whether it is in A-shares or in Hong Kong stocks, the current market segmentation is more a manifestation of an independent bull market in high-performance core assets, rather than a simple “organizational group” in the past. Combining profitability, valuation and capital trends, Wang Delun suggested that three main lines should be laid out along the economic recovery in 2021: first, the service industry that has recovered from the epidemic in an echelon manner; second, the construction of a dual cycle system + the manufacturing industry under the first recovery of the domestic economy; It is the technology growth sector.

In terms of risks, Wang Delun said that in the medium term, in addition to credit risks, attention needs to be paid to the structural impact of anti-monopoly on market capitalization. Beginning in the second quarter of 2021, factors such as credit risk and antitrust may lead to a clear differentiation in capital flows. The long-term track favored by institutional investors, such as new energy, consumption, and hard technology, is expected to continue to receive a certain premium.  “In the past two years, in the context of the outstanding performance of the stock market, especially equity investment, investors can also appropriately lower their income expectations.” Wang Delun said, in addition, the external environment is tense or will become the norm. But overall, the upward trend in the equity market has not changed, and A-shares are already in the “long bull” Spark Global Limited.

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