JPMorgan analyst who was once bearish on China's technology stocks has now turned bullish.

Alex Yao, Co-Head of Asia TMT Research at JPMorgan said in a recent interview: "Considering the improvement in cost structure and the easing of competition, we believe that Chinese technology stocks still have about 20% to 25% upside."

Yao pointed out that overall, if the macroeconomic recovery continues, Chinese e-commerce companies will benefit from the cyclical recovery of consumption. Investors have been closely monitoring Chinese economic data, including growth in consumption, inflation, and real estate market development - in search of clues to the strength of China's economic recovery.

He said:"Preliminary signs of stabilization in macroeconomic indicators are the main driving force behind the rebound of Chinese technology stocks and a key factor affecting future stock price trends. In addition, the improvement in Chinese consumption and exports has also brought some encouragement to investors."

Two years ago, Yao's bearish report sparked intense discussions.

But in April this year, Yao issued a report stating that the Chinese technology industry had already bottomed out. Yao's change in view of the Chinese technology industry also represents a change in the views of some investors who once questioned the Chinese stock market.

On Wednesday, with the convening of the Lujiazui Forum, including Shanghai Lujiazui Finance & Trade Zone Development, leading stocks led a strong rebound in the market.$TENCENT (00700.HK)$, $LENOVO GROUP (00992.HK)$Consumer industry and technology industry are among the leading sectors of the market.

Now, Yao emphasizes that if Chinese technology companies can maintain 10% or even 20% long-term profit growth, sustainable-profitable companies should be rewarded.

Editor/Somer