The stock price of Kweichow Moutai continued to be sluggish today, hitting a new low for the year. As one of A-share's stock kings, Moutai is the faith of many value investors. In this round of "Huangmao Uprising," Moutai's wholesale price quickly plummeted, causing a major adjustment in stock prices. Some netizens have raised a soul-searching question: Has faith collapsed? There is considerable disagreement in the market about Moutai right now. Some investors believe that the growth of baijiu is slowing down, restrained by factors such as aging, young people's dislike, and economic environment. Others believe that the baijiu industry held too much inventory over the past few years, sales will decline in the future, and profits will also decline, making the current stock price overvalued. In critical moments, well-known investor and Moutai shareholder Duan Yongping frequently spoke out, supporting Moutai. Duan Yongping talked about Moutai. Regarding this wave of rapid decline in Moutai's stock price, Duan Yongping said that the market is a voting machine in the short term and a weighing machine in the long term. Therefore, the market is still the same market, and Moutai is still the same Moutai. Regarding the issue of whether he is combating the market, Duan Yongping replied that he is not combating the market and tries not to pay attention to the market. As for Moutai's financial attributes, Duan Yongping said he didn't know what financial attributes meant, but Moutai does have a stored value-added attribute. He guessed that the vast majority of those storing Moutai are not for value-added, but everyone will indeed realize that if you want to buy the wine stored before, the price will be much higher than before. He recalled the scene of the plasticizer incident, saying that at the time, he bought some two-pound and 30-year-old Moutai (now the two-pound is also natural storage for more than ten years) because he didn't drink much Moutai. Most of it is still stored, and friends who occasionally drink Moutai like it very much. He believes that if you want to buy these wines again, assuming you can find them, the price should be much higher. It is more likely to be more cost-effective than holding gold. Regarding Moutai's business model, Duan Yongping was even more straightforward. If our electronics industry encounters poor sales, the consequences are very serious. When Moutai encounters poor sales, it just passively gains more vintage wine and earns more in the future.

Take out a bottle of zodiac liquor to calm your nerves...

As one of A-share's stock kings, Moutai is the faith of many value investors. In this round of "Huangmao Uprising," Moutai's wholesale price quickly plummeted, causing a major adjustment in stock prices. Some netizens have raised a soul-searching question: Has faith collapsed?

There is considerable disagreement in the market about Moutai right now.

Some investors believe that the growth of baijiu is slowing down, restrained by factors such as aging, young people's dislike, and economic environment. Others believe that the baijiu industry held too much inventory over the past few years, sales will decline in the future, and profits will also decline, making the current stock price overvalued.

In critical moments, well-known investor and Moutai shareholder Duan Yongping frequently spoke out, supporting Moutai.

1

Duan Yongping talked about Moutai

Regarding this wave of rapid decline in Moutai's stock price, Duan Yongping said that the market is a voting machine in the short term and a weighing machine in the long term. Therefore, the market is still the same market, and Moutai is still the same Moutai.

Regarding the issue of whether he is combating the market, Duan Yongping replied that he is not combating the market and tries not to pay attention to the market.

As for Moutai's financial attributes, Duan Yongping said he didn't know what financial attributes meant, but Moutai does have a stored value-added attribute. He guessed that the vast majority of those storing Moutai are not for value-added, but everyone will indeed realize that if you want to buy the wine stored before, the price will be much higher than before.

He recalled the scene of the plasticizer incident, saying that at the time, he bought some two-pound and 30-year-old Moutai (now the two-pound is also natural storage for more than ten years) because he didn't drink much Moutai. Most of it is still stored, and friends who occasionally drink Moutai like it very much. He believes that if you want to buy these wines again, assuming you can find them, the price should be much higher. It is more likely to be more cost-effective than holding gold.

Regarding Moutai's business model, Duan Yongping was even more straightforward. If our electronics industry encounters poor sales, the consequences are very serious. When Moutai encounters poor sales, it just passively gains more vintage wine and earns more in the future.

Duan Yongping replied, "I wouldn't be surprised if Moutai's price dropped again for a period of time. As the old saying goes, looking back at this price in ten years, it's likely to be like looking back at the price ten years ago now."

I haven't figured out when to sell Moutai yet.

Duan Yongping, a well-known investor who is famous for investing in Apple, Moutai, and Tencent, has publicly expressed his optimism about Moutai many times since 2014.

When a netizen asked whether he would swap Apple for Kweichow Moutai, Duan Yongping replied that he wouldn't and also said that his governance level couldn't be compared to Apple's.

In his investment in the US stock market, Apple has always been Duan Yongping's largest position, occupying nearly 80% of his portfolio. According to the quarterly report disclosed by Duan Yongping's fund, the core holding is Apple, with a market value of $11.075 billion, accounting for as much as 78.01%.

Apple introduced powerful artificial intelligence Apple Intelligence at the 2024 Global Developers Conference, and its stock price has soared all the way since then. Its latest market value is $32.6 trillion, ranking second in the world, second only to Microsoft.

Regarding Apple's P/E ratio of about 30 times, Duan Yongping is a bit hesitant, saying, "hold = buy, I'm a bit hesitant." He believes that the current 30-year US Treasury bond interest rate is 4.44%, which is equivalent to a P/E ratio of 22.5, which is the opportunity cost of holding any company. The short-term US Treasury bond interest rate is 5.36%, equivalent to a P/E ratio of 18.66.

In addition, Duan Yongping's fund's second-largest heavy-stock holding is Berkshire Hathaway, with a market value of $1.721 billion; Google and Alibaba are the third and fourth largest holdings, with market values of $780 million and $423 million, respectively. In addition, it also holds Disney, Occidental Petroleum, Moderna, PDD Holdings, and Bank of America.

Looking back at Duan Yongping's investment sharing, his investment philosophy is very simple. Buying stocks means buying companies, focusing on the business model of the enterprise and thinking about the long-term development of the company. In terms of predicting the future of companies, he posed the question, "Which companies do you think will still be around in 10 years?" Defining that a company that maintains its revenue and profits equal to or greater than its current levels in 10 years as still in existence, he believes companies such as Apple, Moutai, Tencent are likely to remain in business, as well as Google, Microsoft, and BRK. He hopes OV remains in business, but is not completely certain.

As an investment expert, in the year 2000, Duan Yongping utilized almost all of his investable funds to buy NetEase during the internet bubble and earned over 100 times profits within two years. In 2012, he led OPPO and VIVO employees to buy Apple at a low price earlier than Buffett did. At the end of 2014, he bought Moutai at a little over 100 Yuan and saw its value increase by approximately 10 times after roughly 5 years of holding.

Duan Yongping's holdings are highly concentrated and he has disclosed the main representatives for US Stock, Mainland China Stock, and HK Stock in his portfolio. Apple is his main stock in US, Moutai is his main stock in Chinese A shares, and Tencent is his main stock in HK.

Duan Yongping was born in 1961 and was known nationwide for establishing well-known brands such as "Xiao Ba Wang" and "Bu Bu Gao" during early business ventures. In 2001, he emigrated to America and settled near California. In 2006, Duan Yongping won the chance to have lunch with Warren Buffet for $620,000 and became the first Chinese person to dine with Buffet.

Duan Yongping believes that his secret of success is to "be responsible and remain calm." Responsibility means to do the right things, and when flaws are observed, to immediately stop, no matter how significant the losses. This is the minimum cost of action. Calmness means being rational. At all times, especially when facing temptation, remove distractions and return to the essence of things. Judge right from wrong and know what is the correct thing to do.

In 2023, the company's total sales volume was 18,000 kiloliters, a year-on-year increase of 28.10%. The product structure is as follows: 10-30 billion yuan products generated operating incomes of 401/1288/60 million yuan respectively.

Recently, there has been news circulating within the private fund management industry that a Shanghai-based entity sold their shell company for 650,000 yuan. Many private equity insiders have expressed their opinions that with the rise of the private fund industry, restrictions are expected to tighten with over a year's worth of active concessions and private entities expected to be deregistered by governing departments. The situation is continuing to intensify.

In the past five years, the pace of private equity clearing has clearly accelerated. Reviewing data for the recent years, the number of private equity entities that were deregistered respectively was 772, 1072, 1057, 1230, 2217, 2537, and 883 from 2018 to June 16, 2024.

With the increase of regulatory requirements for registered private equity management, the number of private equity funds that were newly registered dropped from 1946 in 2018 to 479 in 2023. During the same period, the amount of funds private equities raised was reduced, with the figures for 2019-2023 being 56.462 billion yuan, 753.117 billion yuan, 178.693 billion yuan, 123.071 billion yuan, and 29.983 billion yuan, respectively.

It's a mental game to predict the industry landscape after 30 years, but this exercise may also help with investment.

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As a secretive billionaire, Duan Yongping said that people often pay attention to what we have done. In fact, to a large extent, we have also become who we are because of what we have not done. My ability circle is limited, and I don't understand most companies.

2

650,000 selling shells? Less than 100 billion private equity firms

Recently, there have been rumors within the industry that a securities private equity institution in Shanghai sold its shell for 650,000 RMB.

Several private equity insiders said that with the opening of the curtain of the private equity industry's preference for excellence and strict supervision, the industry clearance of securities private equity institutions is accelerating. In the next year, the number of private equity institutions that actively abandon or are cancelled by regulatory authorities is expected to continue to increase.

On April 30th of this year, the AMAC issued the "Guiding Opinions on the Operation of Private Equity Securities Investment Funds", which clearly stipulates the initial filing and continuation scale threshold for private equity securities funds. It requires that the initial actual paid-up fund-raising scale shall not be less than 10 million yuan and set a continuation scale threshold of 5 million yuan, which will have a strong restrictive effect on "shell products".

In the past five years, the pace of private equity clearing has clearly accelerated. Looking at the data in recent years, from 2018 to 2024 (as of June 16), the number of private equity institutions cancelled by the AMAC were 772, 1072, 1057, 1230, 2217, 2537, and 883, respectively.

With the raising of the private equity manager registration threshold, the number of private equity funds that have completed the registration has also sharply decreased. According to the data released by the AMAC, the number of newly registered private equity fund managers decreased from 1,946 in 2018 to 479 in 2023.

At the same time, the issuance scale of private equity funds is also decreasing. The data shows that the issuance scale of private equity funds from 2019 to 2023 is 56.462 billion yuan, 753.117 billion yuan, 178.693 billion yuan, 123.071 billion yuan, and 29.983 billion yuan, respectively.

In addition, the scale of top private equity management has also shrunk, with less than 100 billion private equity firms less than 100. The scale of 100 billion-level private equity management has shrunk. The main reason is that the market is sluggish, the market's profitability is poor, and the investors' redemption willingness is heightened, coupled with the private placement of the issuance market is relatively sluggish.

Data shows that as of the end of May 2024, there were 93 billion-dollar private equity firms in China, of which 76 had performance displays. Among them, there are 31 quantitative private equity firms with a market value of more than 10 billion yuan, 47 subjective private equity firms, 14 mixed quantitative and qualitative private equity firms, and 1 undisclosed relevant information.

The holdings of the big shots of billion-dollar private equity have always been of concern to investors. Since private equity funds do not need to disclose their holdings regularly like public funds, it is difficult to directly obtain the position holding data of private equity products. By statistically analyzing the top ten shareholders and top ten circulating shareholders data disclosed in the quarterly reports of listed companies, the partial position changes of private equity managers can be indirectly observed.

Guosen Securities selected the private equity managers whose stock strategy is the main focus, the management scale is above 10 billion yuan, and the number of stocks that appear in the top ten list before the 2023Q4 and 2024Q1 reporting periods is not less than three as the sample pool for this statistics.

The 20 stocks with the highest increase in shareholding ratio in the first quarter of private equity managers included Xinxiang Richful Lube Additive, Espressif Systems, Anhui Korrun, Suzhou Hengmingda Electronic Technology, and Dashenlin Pharmaceutical Group.

(The content of this article is a list of objective data and information and does not constitute any investment advice)

The 20 stocks with the highest decrease in shareholding ratio in the first quarter of private equity managers included Jonjee Hi-Tech Industrial and Commercial Holding, Zhejiang Huangma Technology, Guangzhou Fangbang Electronics, Shenyang Xingqi Pharmaceutical and Ningbo Solartron Technology.

3

Did margin brokers cause the market to fall? The Securities Regulatory Commission urgently clarified.

Recently, some media reported that 'Margin Brokers' were retaliating and it was no wonder that the market continued to fall, and 'Margin Brokers' added nearly 170 million shares in one day on June 12th.

The spokesperson of the China Securities Regulatory Commission clarified that on June 12th, the number of stock lending transactions increased due to the semi-annual adjustment of the constituent stocks of the index, which caused the stock lending to be “repaid old debts and borrowed new ones”, that is, the stock loans that had been borrowed from the stocks that had been removed from the constituent stocks were recovered, and the newly added constituent stocks were also borrowed. The self-media cited only the data of newly added lending on individual trading days, ignoring the situation of stock holdings and balance reduction.

From the data point of view, 280 million shares and 170 million shares were newly loaned on June 11th and 12th, and 860 million shares and 50 million shares were recovered at the same time. The actual net decrease in the two-day margin broker balance reached 460 million shares. The margin broker balance during the week decreased by 5.4 billion yuan, a decrease of 14%.

As of June 14th, the balance of margin brokers in the entire market was 34 billion yuan, a decrease of 53.6 billion yuan from the policy announcement on February 6th, a decrease of 61%, and the balance of margin brokers accounted for 0.05% of A-share market value.

In the context of the continued sluggish market environment, the market sentiment is particularly sensitive, investors' confidence is weak, and any slight changes may cause panic.

Huatai Securities Research Report pointed out that the problem of the current stock market is extreme speculation and trading 'volume'. Overall risk appetite and investor activity have declined, specifically:

1. The current state of the market is that the pessimists are worried about the unresolved issues, and the optimists still have concerns and cannot form a consensus for going long.

2. For those who are more pessimistic, most of the previous concerns have not been resolved, such as the concentration of chips such as the CSI 300 index, the insufficient attraction of incremental funds in the market, there are fewer sectors with large spaces, and there is no high expectation for future policies; for those who are more optimistic, the problem is mainly that the space for operation and the short-term index space are small, and they can only continue to 'volume' or high-low switch.

3. Pulsatile changes such as the Fed cutting interest rates and economic and financial data have been difficult to have a decisive impact on the stock market. The stock market needs a stronger breaking point, such as whether the Three Central Committee meeting in July can bring more changes and larger-scale industrial-level diffusion.

4. To sum up, the future repair path of the stock market may be: unstable chip clearance (quantitative and margin brokers) → workable space opening (basic logic or high-quality small-cap stocks, etc.) → strong breaking point increases overall risk preference → liquidity, performance, etc. form a positive cycle, and currently it may still be in the first stage.

5. Fortunately, the logic of the bottom of the stock market has not yet been broken, and the index’s downward space near the key point is not large. Market confidence and position replenishment require time, and we look forward to a repairing market in the medium-term.

China International Capital Corporation believes that the current attention to medium and long-term reforms has increased, and the Third Plenary Session of the 7th Central Committee to be held in July is expected to further clarify the direction of medium and long-term reforms. Capital market reforms are being carried out orderly. Along with the recent index adjustments, the A-share market valuation currently has good attractiveness, and there is no need to be pessimistic about the future market performance.