Financial Services Association, March 28 (Reporter Feng Qijuan) Following major adjustments in the first half of last year, Jianxin Fund's Tao Can and Zhou Zhishuo also raised large hidden stocks in the second half of the year.

Compared to mid-last year, Tao Can's Jianxin Reform Dividend, Jianxin High Dividend Theme, and Jianxin New Energy Industry each replaced 9 hidden heavy stock stocks. Jianxin Woxin replaced 8 and 7 hidden heavy stock stocks in 1 year and Jianxin Xingrun in 1 year, respectively. At the same time, 7 hidden heavy stocks were replaced by Zhou Zhishuo's Jianxin Small and Medium Cap Pioneer and Jianxin Optimized Allocation; Jianxin's potential new blue chip and Jianxin Zhiyuan Pioneer had 8 and 5 hidden heavy stocks respectively replaced.

According to statistics from the annual report, Tao Can's five products lost a total of 2,707 billion yuan in 2023. Among them, the Jianxin New Energy Industry lost the most, with an annual loss of 1,271 billion yuan. Zhou Zhishuo's four products lost a total of 1,298 billion yuan in 2023. Among them, Jianxin SME Pioneer lost the most, with an annual loss of 488 million yuan.

As far as the new energy industry is concerned, Tao Can believes that the period of greatest downward pressure on the industry is over; the future mainly depends on the progress of production capacity clearance. Of course, in the current macro and financial environment, A-shares as a whole will continue to have structural characteristics within the new energy industry, and Tao Can's team will also actively participate in rotating opportunities between different segments.

Looking ahead to 2024, Tao Can believes that after nearly three years of valuation compression, there is little room for valuation compression, and fund stocks will usher in a stage where performance-driven stock prices are driven. Overall, under a stable macroeconomic market, asset allocation and style discrimination will still play an important role as in the past three years, but through the basic investment research paradigm of industry allocation and individual stock selection, they will gradually resume their effectiveness in 2024.

Tao Can also gave five reasons for the current medium- to long-term allocation value in the Chinese stock market.

Furthermore, Chow Chi-suk proposed that the period of maximum economic pressure has passed. The efforts of the three major projects will help curb the continued rapid decline in real estate. The recovery in prices will drive corporate profits to bottom up. The recovery in nominal growth will also drive further recovery of residents' incomes, and local government debt conversion has also entered a phase of substantial attack. The GDP growth rate is expected to reach about 5% throughout the year; in terms of fundamentals, the recovery in price levels is an important clue to the fundamental inflection point of A-shares; in terms of valuation, regardless of the depth and breadth of valuation, it is currently at a historically low level.

Tao Can: New energy segments will present investment opportunities

According to the annual report, Jianxin's reform dividend stocks are in order: Tuopu Group, Renfu Pharmaceutical, Xinquan Co., Ltd., Hengshuai Co., Ltd., Desai Xiwei, Jinli Permanent Magnet, Taisheng Wind Energy, Zhou Dasheng, Shanghai Yanpu, and Tonghua Dongbao. According to the interim report data, with the exception of Tuopu Group, the remaining 9 individual stocks have all been replaced.

Tao Can admits that in 2023, there was insufficient grasp in terms of asset allocation and style judgment. The dividends of Jianxin's reform were underallocated in terms of large market value and small market growth style. At the same time, positions were not in line with the weak state. Judging from the results of the whole year, there was a significant adjustment in net worth.

Jianxin's high-dividend-themed invisible stocks are: Jingsheng Electromechanical, Renfu Pharmaceutical, Xinyisheng, Dongfang Cable, Shanmei International, Taisheng Wind Energy, Jinli Permanent Magnet, Cinda Biotech, Ideal Automobile-W, and Huagong Technology. According to the interim report data, with the exception of Xinyisheng, the remaining 9 individual stocks have all been replaced.

Tao Can pointed out that the product will gradually increase its market value allocation positions in the second half of 2023, gradually reversing the trend by increasing the allocation of high-dividend assets.

Jianxin Woxin's one-year hidden heavy stocks were: Dahua Co., Ltd., Renfu Pharmaceutical, Zhou Dasheng, Xinquan Co., Ltd., Tuopu Group, Cinda Biotech, Desai Xiwei, Zhongke Jiangnan, Jinli Permanent Magnet, and Yankuang Energy. According to the interim report data, with the exception of Dahua Shares and Renfu Pharmaceutical, the remaining 8 individual stocks have all been replaced.

Tao Can said bluntly that although both the holding industry and individual stocks showed good growth in terms of performance, the continuous compression of valuations led to strong pressure on stock prices, and net worth experienced major adjustments. In the fourth quarter, through combined departmental adjustments, the allocation ratio for high-dividend market value styles was increased, and the portfolio structure was improved.

Jianxin Xingrun's one-year invisible heavy stock and hidden heavy stock are: Hengshuai Co., Ltd., Zhou Dasheng, Xinquan Co., Ltd., Desai Xiwei, Dahua Co., Ltd., Jinli Permanent Magnet, Renfu Pharmaceutical, Luzhou Laojiao, Cinda Biotech, and Yankuang Energy. According to the interim report data, with the exception of Dahua Co., Ltd., Renfu Pharmaceutical, and Yankuang Energy, the remaining 7 individual stocks also changed.

In the annual report, with regard to Jianxin Xingrun's net worth undergoing major adjustments in one year, the reason given was that it was still insufficient to grasp the allocation and style of major asset classes. Although both the holding industry and individual stocks showed good growth at the performance level, continued compression in valuations caused a lot of pressure on stock prices.

The hidden heavy stocks in the Jianxin New Energy Industry are: Ideal Automobile-W, Jinli Permanent Magnet, Xiaopeng Motor-W, iKodi, Changan Automobile, Xingyu Co., Ltd., Sinocera Electronics, Ruihu Mold, Keboda, and Zhongtian Technology. According to the interim report data, with the exception of Ideal Automobile-W, the remaining 9 individual stocks have all been replaced.

Tao Can pointed out that the product maintains a neutral position, avoids processes such as lithium battery materials and silicon materials where there is a risk of overcapacity, exceeds the direction of auto parts, offshore wind power, etc., and participates in emerging industry topics such as hydrogen energy in stages, but with the overall beta decline in the new energy industry, the leading individual stocks that are the bottom positions are average.

In his view, there has been no change in the long-term logic of the new energy industry, that is, the long-term space is large, the penetration rate is low, the competitiveness of China's new energy industry is strong, and the demand for the industry has maintained relatively rapid growth in the medium term. After major adjustments in the early stages, the valuation level of the new energy industry is already at the bottom of history. Under the pressure of overcapacity, some leading companies with high barriers can still maintain high market shares and reasonable profit levels. Under low valuations, such companies have long-term allocation value; new technological changes in the new energy industry are constantly emerging, and investment opportunities in new segments will continue to emerge. Seizing these opportunities requires forward-looking research and investment acumen.

Regarding the market, Tao Can believes that the current Chinese stock market has medium- to long-term allocation value. There are five reasons:

First, the domestic economy will continue its moderate recovery trend, and the overall policy will maintain a relaxed tone. The low interest rate environment will help enterprises strengthen capital expenditure and high-quality transformation and development of the manufacturing industry;

Second, the US economy may weaken in the second half of this year. The Federal Reserve will begin a cycle of interest rate cuts, and the reversal of the price comparison between the Chinese and US economies will increase the attractiveness of the global allocation of renminbi-denominated assets;

Third, economic and social operations are gradually emerging from the effects of the epidemic, and residents' defensive savings are expected to be released, while the proportion of Chinese residents investing in risky assets such as stocks and funds is only about 10%. As the risk-free interest rate level declines, the equity market's attractiveness to residents' capital is also expected to further increase;

Fourth, the strengthening of capital market reforms will help listed companies survive the fittest, continuously optimize the basic market environment, and emphasize investor-centered regulation;

Fifth, current market valuations are at a historically low level. Equity asset valuations have a prominent cost performance ratio, and medium- to long-term allocation values are evident.

Zhou Zhishuo: The main line is still to find companies with outstanding competitiveness and high risk and return

In the second half of last year, Zhou Zhishuo also made a big sale of hidden heavy stocks of its products.

According to the annual report, Jianxin's small and medium capitalization pioneer invisible heavy stocks are in order: Maiwei Co., Ltd., Huanxu Electronics, Lotus Health, China Baoan, Midland New Materials, China Porcelain Materials, Aimeike, Guanghui Energy, Superstar Technology, and Jingjiawei. According to the interim report data, with the exception of Maiwei Co., Ltd., Midland New Materials, and Sinocera Materials, the remaining 7 stocks have all been replaced.

After investigation, Jianxin's optimized allocation, Jianxin's potential new blue-chip hidden heavy stock and Jianxin's small to medium cap pioneer hidden heavy stock are in the same batch of individual stocks. There are differences in the number of positions held and the ranking of the market value of positions held.

Compared to mid-year data, in Jianxin's optimized allocation of hidden heavy stocks, in addition to Maiwei Shares, Midland New Materials, and China Porcelain Materials, the remaining 7 stocks have been replaced; among Jianxin's potential new blue-chip hidden heavy stocks, in addition to Maiwei Shares and China Porcelain Materials, the remaining 8 individual stocks have also been replaced.

Jianxin Zhiyuan Pioneer's hidden heavy stocks are in that order: Maiwei Co., Ltd., Lotus Health, Yirui Technology, China Baoan, Sinocera Materials, Guanghui Energy, Aimeike, Midland New Materials, Superstar Technology, and Jing Jiawei. According to the interim report data, among them, Maiwei Shares, Aimeike, Midland New Materials, Superstar Technology, and Jingjiawei are still among the hidden heavy stocks in this product; the remaining 5 individual stocks have all been replaced.

Looking back, Zhou Zhishuo mentioned economic transformation “from a stage of rapid growth to high-quality development” in 2020 and issues such as energy security and profit retention and crossing the cycle in 2022. What he obtained was the conclusion that “structural performance often reduces sector opportunities and requires further research and decline”. He hopes to find investment opportunities for companies that can cross the cycle “from the bottom up, find competitive products and services, have supply chain management capabilities, or sufficient supply protection or control capabilities.”

According to Zhou Zhishuo, this kind of opportunity is due to different companies having different endowments. Some are due to their outstanding profitability in the three years of the pandemic and the first year after the recovery of the epidemic; some are due to the fact that the industry has almost cleared up and is about to usher in the dawn; some are industry opportunities brought about by economic transformation and changes in the global industrial chain; some are expected to benefit from the application of new technology; others are expected to transform and have a good risk-benefit ratio.

Following this line of thinking, Zhou Zhishuo's products continue to invest from the bottom up, looking for companies with outstanding competitiveness and high risk and return, focusing on investing in machinery, electronics, coal, national defense and military, power equipment, and new energy, pharmaceuticals, real estate, and non-banking industries.

Chou Chi-suk said bluntly that just as the recovery of the economy cannot be achieved overnight, the boost in the stock market may also have its ups and downs. Although China's economy is still in transition, and the international situation may still be becoming more and more complicated, a number of enterprises that have moved forward in the past are expected to usher in a period of good performance explosion.