This article from the micro-channel public number: Securities Market Red Week (ID: hzkstock), Author: Li Jian, original title “Deep | American riots upgrade, A-share Popular, but still defensive thinking-Interview with Chen Jialin, general manager of Shanghai Shicheng Investment, the title picture is from: Visual China
“We are groping forward in the unknown.” Chen Jialin, general manager of Shicheng Investment, who experienced the bursting of the Internet bubble in 2000 and the financial crisis in 2008, admitted in an interview with the reporter of “Red Weekly” that he and his team The impact on the economy and society can only be seen and seen. Regarding the recent violence in the United States, Chen Jialin said, “A shares will not directly benefit from social problems in the United States, and there will not be a large amount of capital flowing into A shares in the short term, so we must be careful in investing to do our own thing. .”
Because the global economic recovery is “unclear”, Chen Jialin has lowered some high-leverage, high-debt targets in the allocation, and has reservations about positions. Chen Jialin is still optimistic about several major circuits such as consumption, technology and medicine, and believes that the logic of mid- and long-term investment in these circuits has not changed. The only change is the current valuation. He has reduced the position of some targets. Specifically, he believes that small appliances already have a good configuration value.
American social problems are intensifying, the A-share market abandons offensive thinking and shifts to defensive thinking
“Red Weekly”: Last week, the United States experienced serious social problems and increased uncertainty. In contrast, A shares rose sharply on June 1, what do you think of the price advantage of A shares?
Chen Jialin: A shares will not directly benefit from social problems in the United States, and it is unlikely that there will be a large amount of short-term capital inflows. As long as you do your best to do your own thing, Chinese assets, including A shares, can become high-quality assets worldwide, not so-called safe-haven assets.
Red Weekly: You have nearly 25 years of investment experience, having experienced the Asian economic storm in 1997, the bursting of the Internet bubble in 2000 and the global financial crisis in 2008. This epidemic has triggered a series of global crises. What do you think and understand?
Chen Jialin: The investment history of 25 years looks quite long, Actually very short. Buffett, 89, has been investing since he was 11 years old and has been doing it for 78 years. His assessment of the impact of the current new crown epidemic is “unseen in life.”
Our team’s observations on the “epidemic black swan” are: No matter the epidemic itself or the impact of the epidemic on the market, economy and society, it is unprecedented. Historical experience can draw on some, but more still requires us to explore in the unknown. We can only do some situation analysis, draw up corresponding plans according to different situations, and then respond or make timely corrections according to the actual situation.
“Red Weekly”: Now, how should investors make a portfolio?
Chen Jialin: Don’t think about offense first, give priority to defense and keep the principal before you can have a chance to earn income. At present, we are more concerned about companies with strong anti-risk capabilities, and have reduced some companies with high leverage and high debt ratio, such as financial companies, while looking for companies with low leverage and low debt. We also pay attention to leading companies and companies that benefit from China’s huge domestic demand market, and are also optimistic about online economic related companies. By intersecting or combining these areas, we can find industries and companies that are relatively beneficial in the current environment, and can avoid some sectors that may face losses.
“Red Weekly”: This year’s government work report did not determine the GDP growth target, but “six stability” and “six guarantees” itself have the connotation of stable economic growth. Economic growth?
Chen Jialin: This is the first time that the GDP growth target has not been announced in the government work report since 2002, indicating that the economic recovery is facing greater uncertainty. But do not set a quantitative goal does not mean that our goal is not clear, our goal is broken down into a lot of major work, such as “six stability”, “six guarantees”, these require our economic growth to maintain Within a reasonable range.
But I think that the recovery speed of various industries will be quite different, and some industries have already noticeably improved. For example, the express delivery industry, China’s express delivery business in April increased by more than 30% year-on-year. industry. We expect that China’s express delivery business unit growth rate may exceed 40% in May. Another example is the online economy-related enterprises, which are also driven by “segregation at home”. The habits of online consumption and entertainment are not disappeared after the epidemic. This change is a lasting and far-reaching change.
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From the perspective of industries that have been significantly affected by the epidemic, such as the aviation industry, the number of international flights normally operated by China is currently only about 1%. The progress of the aviation industry’s recovery mainly depends on the control of the international epidemic. If the United States has more than 30,000 confirmed cases every day as it is now, the recovery of the aviation industry will be very slow.
Therefore, the recovery curve of each industry is different. The manufacturing industry is going faster. Wine and other industries will hover at the bottom for a long time. Adding these industries together to see the overall economic recovery trend, I think it will be better than Market expectations are now slower.
Consumer, medicine and technology investment logic has not changed, but currently needs to be flexible in terms of positions
Red Weekly: Because of China’s ability to respond to the epidemic, there are views that A shares will become a global safe haven.
Chen Jialin: I think this statement underestimates the potential of China’s assets and the A-share market. The so-called safe haven is a piece of safe assets that everyone finds during the crisis. Have safe-haven assets.
Are current A shares safe? I don’t think so. The Chinese capital market has not yet developed to this level in the global capital market. After all, we are still an emerging and transformed market. The capacity of A shares is still relatively limited. The global stock market of tens of trillions of dollars, A shares The scale of foreign investment is only about 300 billion US dollars. But I believe that such a large economy in China has a broad domestic demand market, and many sustainable industries and quality companies will certainly be born.
Our company issued the first product in 2008, when the Shanghai Stock Index was more than 3,100 points, and today the Shanghai Stock Index is less than 3,000 points. But the investment is not to invest in the entire market, but to invest in a core part of assets in the Chinese economy.
“Red Weekly”: You have always been optimistic about finance, pan-consumption, medical services and cyclical companies. Under the epidemic, has your research logic in these four areas changed?
Chen Jialin: There is no change. For example, in the medical service industry, the short-term, medium-term and long-term logics are all there.
In the short term, many companies in the subdivision sector have experienced a surge of stimulus from the epidemic. This stimulus is still in place because the overseas epidemic has not ended.
In the medium term, medical services are a key area of China’s public health system, and the country has recently introduced new policies to strengthen the construction of the public health system.
In the long run, China’s aging population has brought a lot of room for growth for medical service companies.
So There will be no change in the continued development of the pharmaceutical industry, except that the current market funds are flowing to the pharmaceutical sector, which has pushed up the valuation of related stocks. We combine corporate fundamentals and valuation Flexible adjustments have been made, but the configuration logic has not changed.
In the field of science and technology, we are optimistic about the three sub-sectors of computer, cloud computing and semiconductor, it is enough to look at these three industries, we do not need to pay too much attention, we hold no more than 6 Only technology stocks. Specifically, the computer software industry faces the domestic demand market and is less affected by overseas markets, and these companies are all asset-light models with debt ratios and leverage ratios within an acceptable range. Under the independent and controllable development opportunities, leading domestic computer companies will obviously benefit.
The same is true for pan-consumer companies. China has a population of 1.4 billion, and the huge domestic demand market is a scarce resource worldwide. We have made flexible adjustments to our positions, but the medium-term and long-term logic has not changed. The same is true for cyclical stocks. If we want to win the tough battle against poverty this year, the old infrastructure will play a very important role, so we are optimistic about construction materials, construction machinery and other companies related to traditional enterprises.
We have always been optimistic about these sectors. We may still be optimistic about these sectors after three months, but the weight will be adjusted according to the macro environment and corporate valuation at the time.
For example, since the beginning of the year, we have reduced the proportion of positions in the large financial sector, because in the uncertain macro environment, the debt ratio of financial companies is relatively high. We have adjusted the weight of big finance to consumer and medical service companies. At present, the consumer companies with the highest percentage of our positions have a weight of more than 20%; followed by technology growth companies; then medical service companies; and finally financial and cyclical companies.
Be cautious about mandatory consumption, and small appliances have a high cost performance
“Red Weekly”: At present, the valuation of many consumer leading companies has reached a record high, how do you see the value of these consumer leading companies? What about second-tier consumer companies with relatively low valuations?
Chen Jialin: The valuation of some mandatory consumption is now relatively higher than that of optional consumption, so we are also relatively cautious, and the position is not too full. In the short term, the stock prices of these big leaders with higher gains are likely to be corrected, but the long-term trend of the stock prices of excellent companies is still upward.
The epidemic is a touchstone, which can detect whether enterprises can effectively adjust their strategies when responding to the crisis, and quickly implement the landing, so it helps us to distinguish which companies have enjoyed the development of the industry dividends and which companies have worked hard by themselves of. For example, the leading companies in the field of liquor and condiments themselves have generous moats, and they are actively and actively adjusting their strategies in the epidemic situation. Such companies must have more room for future growth.
For second-tier consumer companies, we believe that there are many opportunities. For example, we are optimistic about the home appliance industry. When investing in the home appliance industry before, we all said that the white electric faucet is the best choice. However, under the impact of the epidemic, we made some adjustments to the positions, and some of the positions were adjusted to small household electrical appliance enterprises.
Why adjust this? Because Home Appliances may be affected by the real estate industry chain, it will also be affected by export restrictions, and it will also be affected by leverage, and the offline stores of Home Appliances account for a higher proportion of overall sales.
Small appliances are closer to fast-moving consumer goods, and the correlation with real estate is relatively low, and it is mainly based on domestic demand, and the proportion of exports is small. It is also less affected by overseas uncertainties, and online sales It accounts for a higher proportion of overall sales. Therefore, whether it is the published first quarter report or the outlook for the second quarter and the second half of the year, in the short and medium term, small household electrical appliance companies have shown higher cost performance than major appliance companies.
“Red Weekly”: How to judge the competitiveness of small home appliance companies?
Chen Jialin: This needs to be implemented at the company level. We will pay attention to the company’s governance structure, development strategy, including financial status, stock valuation, investor structure and many other aspects. For example, we are optimistic about a small home appliance company. The original position in consumers’ minds is very single. However, in recent years, companies have educated consumers to let everyone realize that the company has many high-quality products in the field of kitchens and small home appliances.
In the company’s latest statistics, many people bought the company’s products for the first time, which shows that the company has made great progress in expanding new customers, and the company mainly targets young consumers, which also lays a solid foundation for continued development in the future. Good foundation.
“Red Weekly”: In addition to valuation factors, under what circumstances will you selldecision making?
Chen Jialin: In the wrong case, we will choose to sell, in fact, this is not a small number. For example, we went to a company for research many times and chatted back and forth with the company’s chairman and chief financial officer many times. We think that we have seen this company clearly, but afterwards we found that it was not the case.
We have previously focused on a state-owned company, and its performance has been very good, but later we found that we underestimated the problems of corporate governance. Although this company is on an excellent track and has good resources, but The management of the company does not act, nor can it be allocated as a good stock.
Another situation is, When we think that macro factors and valuation factors will cause the stock price to fall by 50%, it is acceptable to sell when the stock price falls by 20% because we Consider that the client wishes to obtain a portfolio with less risk. But if we do not understand the company and sell it when the stock price drops by 20%, we cannot accept it.
public channel number from the micro herein: Stock Market Red Week (ID: hzkstock), of: Li Jian