HSBC Research upgraded its rating on the China Mainland market to 'shareholding', the valuation is still attractive for latecomers to enter.
HSBC Research has released a report, upgrading its rating on the mainland market from 'Neutral' to 'Shareholding', indicating that the authorities have announced a series of bold stimulus measures, marking a turning point in the market and possibly providing a window to outperform the broader market. The current valuation of the mainland market is still attractive, and it is not too late to enter. HSBC Research believes that whether these policy measures will ultimately address structural obstacles and real estate issues is not important at the moment. The key is that the mainland has already formulated policies that will play an important catalytic role in undervalued markets. The report points out that after the FTSE China indices rebounded by 28% in the past two weeks, some investors are questioning whether this ship has already set sail.
What's going on? Hong Kong stocks plunge sharply, the technology index once fell more than 6%, with real estate, autos, and network technology sectors experiencing heavy losses.
At the morning opening, the Hong Kong stock market experienced an adjustment. The Hang Seng Index and the Hang Seng Tech Index both fell, with the Hang Seng Index dropping more than 3% and the Tech Index falling over 6% at one point.
HSBC Research's investment rating and target price for Chinese internet stocks (table)
HSBC Research has published a research report on the investment rating and target prices for Chinese internet stocks as follows: Stock | Investment Rating | Target Price Tencent Holdings (00700.HK) | Buy | HK$500 -> HK$570 NetEase (NTES.US) | Buy | $100 -> $120 Meituan (03690.HK) | Buy | HK$172 -> HK$220 PDD Holdings (PDD.US) | Buy | $140 -> $183 JD.com (JD.US) | Buy | 3
haitong int'l: Recently, the policy stimulus has transformed into fundamental improvement but remains uncertain. Bullish on Meituan (03690.HK), Tencent (00700.HK), jd.com (JD.US), netease (NTES.US), pdd holdings (PDD.US), and new oriental (EDU.US) etc.
haitong int'l released research reports indicating that the Chinese Internet sector rebounded last week, with the hang seng tech index rising over 20% from September 23 to 27. During the same period, the Shanghai-Shenzhen China Internet ETF (KWEB.US) also increased by 25%. Looking back at the two rebounds in the industry over the past two years, it is believed that the prices of most stocks in the industry have not yet returned to pre-epidemic highs. Considering that the series of policies recently introduced by the authorities may not translate into driving forces for fundamental improvement anytime soon, haitong int'l recommends that investors adopt a bottom-up stock selection approach, focusing more on enterprise valuation and fundamental improvement, and paying attention to e-commerce, entertainment, and online travel.
Who's buying? The A-share market is closed, but the Hong Kong stock market is still going strong! There's a big shift in foreign capital underway.
According to the latest report published by Goldman Sachs, after the People's Bank of China announced easing measures and the September Political Bureau meeting, mainland consumer stocks rebounded strongly by an average of about 32% in the past week.
[Hong Kong Stock Connect] Kuaishou (01024) rose by 7.38%, institutions pointed out that it will continue to benefit from its content advantages driving e-commerce sales.
Golden Finance News | Kuaishou (01024) is showing strong volatility, as of the time of writing, it has increased by 7.38% to HK$58.9, with a turnover of 0.981 billion Hong Kong dollars. On the news side, Citi Research issued research reports pointing out that Kuaishou's e-commerce strategy focuses on driving product sales more than subsidy sales, bullish on its continuous promotion of the platform and simple ad products to drive internal ad conversion, while external ad spending from short videos, mini-games, and novels can be seen. On the other hand, the company's AI applications will also improve content creation and recommendations. In particular, Kelin's large model can create videos lasting over 1 minute. The bank expects Kuaishou to maintain around 15%.