The rating agency Moody's earlier tested 61 Chinese-funded non-financial companies. It mainly assessed in five major areas, including corporate governance, business models, rapid growth strategies, profit or cash flow quality, and auditor opinions. Using “red flags” as a signal, many stocks assigned “red flags” declined significantly yesterday. Nine Macquarie analysts jointly published a research report saying that although the regulations of some enterprises in China lack transparency, the market recently seems to be popular for Chinese private enterprises to “presume that you are guilty until you prove your innocence”; at the same time, it is very difficult for private enterprises to “prove their innocence” in the face of some accusations, such as how can management prove that they have not “hidden” the company's problems. At the same time, Macquarie reminded investors that ratings agencies' reports target different readership groups. Reports generally mainly target the risk of default by bond issuers, and this kind of targeting causes rating agencies to adopt a completely different risk tolerance and attitude. For example, a company with rapid growth and high capital expenditure is usually viewed by analysts as a positive factor in stock prices, but rating agencies are much more conservative in considering this. Macquarie pointed out that in any case, the valuations of Chinese companies listed in Hong Kong have discounted a considerable amount of bad news, and there is not much room for further decline. The current valuation of H-shares has been discounted 25% from its long-term average. Macquarie gave China Glass (03300-HK) a target price of 7 yuan and granted an investment rating of “outperforming the market”, pointing out that the Moody's report erroneous that its family holds more than 30% of the shares, that the company has no family holdings, and emphasizes that the company is growing rapidly. China Automation (0569-HK) was given a target price of 7.5 yuan, and an investment rating of “outperforming the market” was awarded. Awarded to Super Hyundai (00682-HK) with a target price of 3.09 yuan and a rating of “outperforming the market,” Macquarie reiterated its rating of “increased holdings” in the Chinese real estate sector, pointing out that under the current weak market environment, Chinese real estate agents are expanding their market share. In the first half of this year, the contract sales of Chinese real estate developers increased by 60% in the first half of this year, despite a decline in trading.