
Without further ado, let’s talk about the top ten gold stocks we selected in April:
Longguang Real Estate (03380), China Resources Land (01109), Color Life (01778), Baiyun Mountain (600332)(00874), Fosun International (00656), Dongfang Electric (600875)(01072) and Geely Automobile (00175).
Let’s talk about the retrospective performance of the top ten gold stocks in March:
China Unicom (03969) rose 14.95%, Truly International (00732) rose 10.61%, Kerry Logistics (00636) rose 8.48%, CITIC Securities (600030) (06030) rose 7.37% and China Tower (00788) rose 4.97.
Enter the text as follows:
Hong Kong stocks are a volatile market in March, with the index operating space of 28,201.09-29,486.15 points, which is in line with the forecast of Zhitong Finance APP in March. Looking at 28,000 points, it will not break, and looking at the pressure of the top 30,000 points.
In last month’s strategy report, it was pointed out: "The HSI should pay attention to the beginning of the month and the end of the month." Now, it is true. On March 8, the HSI retreated its annual line due to the downgrade of A-share brokers, and at the end of the month, it retreated again due to the decline of US stocks on March 25. Overall, it is a shock as expected.
Judging from the market performance, the varieties that performed better in February generally showed a callback, and the brokerage varieties had a larger callback. The withdrawal of this emotional indicator showed that investors were cautious about the market. At the same time, there is also a general correction in the 5G and technology categories. On the contrary, the real estate sector has performed strongly, and the defensive food and beverage and textile and apparel categories have performed strongly. There is no improvement in big blue chips.
After repeated shocks in March, the market in April has entered a more critical node, because after the spring market in March, April entered a more complicated situation, and there are many factors that will cause factors to the market. Therefore, Zhitong Finance APP generally believes that April will be more cautious, and there will be more unpredictable things, so be careful that there will be changes. On the bright side, as long as we hold on to April, the situation will be clearer later, but if there is an adjustment, then the adjustment will probably be larger.
First of all, let’s look at the positive factors in April:
The first thing to bear the brunt is the continuous promotion at the policy level, such as the central bank’s expectation of water release. Zhitong Finance believes that the RRR cut is a high probability event, and it is a matter of time, but the extent of water release needs further observation. Of course, if it is to cut interest rates, it will be a heavyweight benefit. For the time being, this possibility is small. The benefits of increasing tax cuts and fee reductions have also contributed to the market.
Secondly, it is the expectation of incremental funds. For example, many newly issued fund-raising funds are preparing to actively enter the market. All kinds of state funds have also entered the market. At the same time, the relative weakness of external environment such as US stocks will also attract the allocation of overseas funds to Hong Kong stocks. Finally, with the weakening of the US dollar, the RMB exchange rate as a whole will form a strong support, which is also an important aspect of attracting foreign investment.
However, there are still many unfavorable situations in April:
First, the progress of Brexit. To prevent the extreme situation of Brexit without agreement, all EU countries are considering how to deal with this risk and pay close attention to this progress.
The second is the Sino-US trade negotiation, which is expected to be bargained. The grounding of Boeing 737MAX incident is only an episode, and China and the United States are still competing for 5G. This process is difficult to accomplish overnight. I’m afraid it will take a long time. We should be prepared for a protracted war and pay attention to some information conveyed, which will have a great impact on the stock market.
Third, there is a key data to pay attention to. The PMI in early April, the economic data in the first quarter and March around April 15th, including the house price index of 70 large and medium-sized cities released by the National Bureau of Statistics of China in March, etc., will be the key factors to determine the next market direction. If the data is biased, it will stimulate the stock market positively; if the data is weak, it will put pressure on the confidence in the market.
Fourth, the situation in Latin America and the Middle East, especially the turmoil in Venezuela, Rarity and Latin America, has now formed a wrestling between the United States and Russia. Once the conflict intensifies, it will pose a greater risk point.
Fifth, we should be careful that the situation of "three kills of foreign exchange and bonds" in Turkey will spread, and emerging markets should be careful that there will be transmission.
Sixth, the risk of US stocks. For the time being, the trend of US stocks is still benign, but we should also pay attention to the risk of downside.
Judging from the above situation, Hong Kong stocks should pay special attention to this key node around the 15th, and the market will generally reflect it in advance. The normal index range continues to look at 28,500-30,000 points. If you prefer, you have a chance to break through 30,000 points. If the situation is not good, look at the support of 28,000 points, and the extreme situation is 27,500 points.
Investment strategy in April: grasping the main line of favorable policies
In March, the top ten gold stocks continued to outperform the broader market. The Hang Seng Index rose by 2.57% in the same period, and the top ten gold stocks rose by an average of 6.02% in March. The specific increase is as follows:
The biggest gains of the top ten gold stocks in March: China Tonghao (03969) rose by 14.95%, Truly Trust International (00732) rose by 10.61%, Kerry Logistics (00636) rose by 8.48%, CITIC Securities (06030) rose by 7.37% and China Tower (00788) rose by 4.97.
In April, there will continue to be no trend market, or we will survive in the shock. The promotion of favorable policies is expected to become the mainstream in April. Zhitong Finance is expected to have several directions. First, lowering the RRR or cutting interest rates will directly stimulate real estate stocks, which is the biggest main line; Second, this kind of reform, such as the merger and reform of central enterprises, etc. The third is the expectation of consumer May Day holiday after performance baptism; Fourth, medicines and automobiles in the direction of value revaluation.
The details are as follows:
Real estate: Longguang Real Estate (03380), China Resources Land (01109)
Real Estate Property: Cai Life (01778)
Medicine: Baiyun Mountain (00874)
Finance: Fosun International (00656)
Power: Dongfang Electric (01072)
Car: Geely Automobile (00175)
Consumption: over the rainbow Textile (02678) and Tsingtao Beer (00168).
Manufacturing: China Zhongwang (01333)
The detailed list is as follows:
1. Longguang Real Estate (03380)
In 2018, Longguang Real Estate’s home advantage in Guangdong-Hong Kong-Macao Greater Bay Area’s core cities was further revealed. The number of transactions and transaction area of the company in Shenzhen market ranked first in the city, and it was in the forefront in cities such as Zhuhai and Foshan. At the same time, the company won the title of both equity sales and sales area in Nanning, and continued to rank first in Shantou. At present, the company has abundant funds and no financial pressure due to debt. As the real estate industry enters the accelerated integration period, there will be a large number of M&A opportunities in the industry. In the future, the company will actively seek more M&A targets and lock in more high-return projects at low cost.
2. China Resources Land (01109)
As one of the representatives of central enterprises, China Resources remained stable in 2018, achieving contracted sales of 210.68 billion yuan, up 38.5% year-on-year, and officially entering the 200 billion camp, once again maintaining the consistent scale and ranking of China Resources at an appropriate growth rate. By the end of 18 years, China Resources Land owned and operated 9.21 million square meters of commercial properties, including 23 Vientiane City/Vientiane World and 12 Hi5/ Vientiane Hui. In addition, 43 shopping centers are under construction. China Resources Land also operates 17 asset light shopping center projects. In addition to real estate development and investment in property business, China Resources Land has achieved new growth by implementing the "2+X" business model. X business includes urban renewal, property management, long-term rental apartments, homes for the aged, culture and sports, industrial funds and Vientiane cinemas. At present, the company is operating more than 30 urban renewal projects, including 16 key projects with a construction area of 22 million square meters, which may be realized in the next few years. By the end of 18 years, the contracted area of the company’s property management business reached 100 million square meters, and it is expected to reach 200 million square meters in 2020. The amount sold but not carried forward is RMB 187.4 billion, of which RMB 99.2 billion will be confirmed in 2019.
3. Color Life (01778)
Color Life achieved brilliant results in 2018, with high-speed endogenous growth in contract management area and leading industries in many indicators. As the company continues to expand its service area in the form of "platform output" and the "Big Dipper": e-safety, e-maintenance (including e-elevator), e-energy, e-cleaning, e-greening, e-payment and e-complaint, the platform of basic property management functions is realized.
4. Baiyun Mountain (00874)
In 2018, the consolidated revenue of GPHL increased greatly, and many factors affected profits in the fourth quarter. Integration of Guangzhou Pharmaceutical Co., Ltd., some minority shares of Wang Laoji Pharmaceutical Co., Ltd. and Wang Laoji trademark. The equity of the two core subsidiaries has been increased, and the current book holds 16 billion cash. In 2019, the company plans to invest 3.1 billion capital expenditure, mainly for the construction of production bases, equipment renewal and information system construction, and start a new round of asset-driven endogenous growth. It is estimated that in the next three years, big business, Danan medicine, Chinese medicine and Dajian will maintain a steady growth rate of about 8%, Danan medicine will maintain a double-digit growth rate, and profits will be higher than revenue growth rate due to synergy.
5. Fosun International (00656)
Fosun’s international business mainly focuses on three ecological and industrial unicorns: health, happiness and prosperity. As the basic assets of the company, Fuyu Ecology includes many financial businesses such as insurance, banking, securities and asset management, and is mainly responsible for providing stable cash flow. Health and happiness are the core assets for the company to implement C2M strategy. The industrial unicorn is the result of Fosun’s strategy of "technology leading and innovation driving". C2M proposed by Fosun aims to connect customers and manufacturing terminals through artificial intelligence, big data, cloud computing and other technologies, and fully meet the individual needs of customers by optimizing supply chain and upgrading products, so as to help its enterprises release surplus capacity and achieve rapid growth. We are optimistic about the growth of the company’s industrial investment layout and the strong ability of the group level to empower post-investment management and resource integration.
6. Dongfang Electric (01072)
The company is an old-fashioned central enterprise. In the field of hydropower, the group has made phased progress in the first million-kilowatt turbine runner used in Baihetan Power Station, the largest hydropower station under construction in the world. In the field of wind power, we focused on the development of 8-10 MW high-power units for offshore use, and were awarded the IEC design certification certificate for 10 MW offshore wind turbines, becoming the first complete machine manufacturer in China and the second in the world to obtain this certificate; In terms of thermal power, the 630-degree high-efficiency ultra-supercritical unit being manufactured by the group is also at the advanced level in the world; In terms of hydrogen energy, the group developed a new generation of hydrogen energy batteries last year, which improved the efficiency while reducing the cost by 15%. In addition, the Group is laying out the R&D and application of new energy materials, promoting intelligent manufacturing, actively promoting mixed reform and asset securitization, and building a global leading energy equipment power system solution provider.
7. Geely Automobile (00175)
We are optimistic about the company’s layout in terms of technology, models and platforms. At present, Geely Automobile owns Volvo Cars, British sports car brands Lotus and Proton of Malaysia, and holds shares in the truck manufacturer Volvo Group. Bo Yue and Emgrand GS preserved their strength, and their vision X3, Lectra series and 18-year-old new models Binrui and Binyue performed brilliantly. At the beginning of last year, Zhejiang Geely, the parent company, invested in Daimler, the parent company of Pingzhi Car Factory in Germany, and cooperated for the first time to produce cars. The two sides formed a joint venture company, each holding 50% of the shares, and jointly developed the "smart" brand in the world, which will become a brand of pure electric smart cars, and it is expected to further reflect its comprehensive advantages and gain more market share.
8. over the rainbow Textile (02678)
The company is one of the best textile manufacturing enterprises in China. The management team is professional and efficient, and has a highly forward-looking investment vision (it has been produced in Vietnam in 2006, and the accumulated investment currently exceeds 4 billion yuan). In addition to the yarn industry being active as a global elastic core-spun yarn leader and continuing to achieve large-scale expansion in the future, the pace of vertical integration continues to advance (including the vertical industrial chain layout in Vietnam, the acquisition of vertical Nianxing Textile to enter the jeans business, the acquisition of Huafeng Knitting, and Zhejiang Qingmao to enter the downstream fabric business, etc.). In addition, the establishment of a joint venture with Hong Kong Qingye, a leading enterprise in the woven dyed fabric industry, will make the company’s vertical integration "even more powerful". As the leader of China’s textile enterprises with high management efficiency and vertical integration strategy, with the increase of scale and the sales and R&D capabilities of Hong Kong Qingye, the market outlook will continue to be firm and optimistic.
9. Tsingtao Beer (00168)
Tsingtao Brewery has a long history, is well-known at home and abroad, with outstanding brand value, high-end product positioning and leading the industry in ton price. Consumption upgrading and ton price increase will be the core driving forces for the development of the beer industry in the future, and the target with excellent pattern is expected to continue to benefit. At present, the industry has shifted from low-end price war competition to high-end brand competition, and the price war has slowed down. From April 1, 2019, the VAT rate will drop from 16% to 13%, which will greatly increase the net profit of the beer industry. Tsingtao Brewery, as the leading beer industry in China, is expected to benefit from the increased concentration after the change of the pattern. In addition, Fuxing, as a financial investor, is expected to promote the reform of the company’s internal mechanism and release the vitality of the enterprise.
10. China Zhongwang (01333)
The main revenue of the Group is the sales revenue of aluminum extrusion business, aluminum calendering business and deep processing business. At present, the share of aluminum alloy templates in the national template market is only 18%, which is 50% to 60% compared with the average level in Europe and America, and there is considerable potential replacement space. The Group continued to help China rail transit trains speed up and upgrade, supplying aluminum for the high-speed rail "Fuxing" EMU, and exclusively supplying deep-processed products such as car bodies and large parts of car bodies for commercial maglev version 2.0 trains. Automobile panel products have passed the certification of some domestic new energy automobile manufacturers, and started to supply in small quantities. The second production line has started the trial production of samples for some potential customers. Overseas market: The Group has become a first-class supplier of Jaguar Land Rover, and will directly provide high-quality aluminum alloy product solutions for its British factories, and formally enter the supply chain of overseas automobile manufacturers. The production efficiency of Alunna, a high-end aluminum extrusion subsidiary of the Group in Germany, has been significantly improved, and the project successfully passed the certification of Airbus "IPCA+" (Industrial Process Control Assessment) and was awarded "A" grade. SilverYachts, an all-aluminum alloy super yacht company under the Group, will deliver a newly built super luxury yacht within this year, and at the same time, speed up the market layout of China, and choose Jiangmen as the site to build a production base for commercial boats and aluminum alloy yachts.
Text/Wan Yongqiang (Director of Zhitong Financial Research Center)
Disclaimer: The shares in this article are only for discussion by shareholders, and shall not constitute investment advice. The stock market is risky, so you need to be cautious in investing.
This article first appeared on WeChat WeChat official account: Hong Kong Stock Excavator. The content of the article belongs to the author’s personal opinion and does not represent Hexun.com’s position. Investors should operate accordingly, at their own risk.
(Editor: HN666)