Zhitong Finance App learned that CICC released a research report stating that mainland funds paid unprecedented attention to Hong Kong stocks, from the beginning of the year to yesterday (January) On the 19th) Mainland funds continued to flow into Hong Kong stocks through the Shanghai-Hong Kong Stock Connect, and the net inflow has exceeded RMB 150 billion. The four major investment logics that currently support Hong Kong stocks include growth, valuation, liquidity, and a new economic sector.
The bank said that China’s growth is still recovering, and that this year’s profits have maintained high growth. The bank estimates from top to bottom that Hong Kong’s Chinese stocks will achieve a 1520%profit growth this year. The Hong Kong stock market is relatively more focused on profit. In terms of valuation, Hong Kong market valuation still has a valuation advantage over A shares, and the Hong Kong stock discount of A/H listed companies is still as high as about 37%, the comparison of similar industries also shows that the valuation of Hong Kong stocks in most industries is lower than that of A shares.
The report stated that in terms of liquidity, Hong Kong stocks are more affected by international liquidity. The current Mainland policies are gradually”turning”. Because of the relatively lagging prevention and control of public health incidents overseas, the bank’s capital flows are still relatively loose. Monitoring shows that overseas funds have flowed into Hong Kong for 20 consecutive weeks.
In addition, in terms of the growth of the new economy sector, mainland new economy companies have continued to be listed in Hong Kong in recent years, which has also become attractive to mainland funds. Recently, due to the impact of the incident on some Chinese capital The valuation of leading stocks was suppressed to the lowest level in history, which also attracted some mainland funds to go south.
CICC mentioned that when the Shenzhen-Hong Kong Stock Connect was opened, it was estimated based on the situation at that time. In the next 5 to 10 years, the net inflow of funds from the mainland to Hong Kong stocks can reach an average of 200 billion to 400 billion yuan per year. Since the opening of the Shanghai-Hong Kong Stock Connect in 2014, mainland funds have accumulated 1.66 trillion yuan south, which is basically in line with the bank’s expected range. Last year, the rate of capital flow from the Mainland to the south increased significantly. The annual capital flow to the south reached over 600 billion yuan. The issuance of public funds has continued to maintain a relatively rapid rate since the beginning of the year. 50%).
Considering the capital inflow potential of insurance, private equity and other types of institutional investors, and mainland investors’ understanding of Hong Kong stocks has greatly improved, the bank estimates that under the premise that Hong Kong stocks’ valuations remain attractive, they will go south The average annual capital inflow potential in recent years may remain at a high level of RMB 500 billion to RMB 600 billion. In the medium and long term, the proportion of mainland institutional investors’ holdings between A shares and Hong Kong stocks may roughly match the ratio of market capitalization on both sides (the current ratio is roughly 7 to 3).
CICC believes that the current Hong Kong stocks can choose stocks from four ideas, including high-quality Internet and technology leaders , A/H listed Hong Kong stocks at substantial discounts, large market capitalization, low valuations, stable or improved fundamentals, A-shares are relatively scarce or unique companies with characteristics in Hong Kong stocks, and those whose valuations have recently fallen sharply affected by events Leading blue chip company.