Wang Hui
At the beginning of the new year in 2023, a number of well-known tens of billions of private equity annual A-share strategic outlooks have been released one after another.
"Economic recovery", "market upswing is expected", and "post-epidemic recovery" have become the three key words for private equity institutions to set the tone for the market in 2023.
Chongyang Investment, Mingluo Investment, Shifeng Assets, Fusheng Assets, Black Wing Assets, Dunhe Asset Management, Star Stone Investment and many other private equity companies generally believe that the recovery of domestic economic fundamentals in 2023 is expected, and the A-share "Spring" is coming, and the restoration of domestic demand has become a common investment theme for private equity institutions.
Optimistic about the recovery of economic fundamentals
Chongyang Investment believes that the disturbance of the epidemic is the core variable that has affected China's economy in the past three years.
In 2023, with the adjustment and optimization of domestic epidemic prevention and control policies, the certainty of the economic environment will be strengthened, and the confidence of market players will be significantly restored.
In terms of major economic fields, with the continuous efforts of policies since November 2022, and the gradual stabilization and recovery of residents' income and income expectations, the credit contraction on both sides of real estate supply and demand is coming to an end.
In addition, infrastructure investment is expected to remain strong in 2023, and the contribution of exports and consumption to economic growth may "ebb and flow".
Mingluo Investment said that looking forward to 2023, the domestic economy is expected to recover on the basis of a low base in 2022.
From a policy perspective, the real estate policy is moderately relaxed, the monetary policy is expected to remain relatively loose, and the fiscal policy will continue to exert force, which will help boost market risk appetite.
Shi Feng Assets believes that China's overall economic situation in 2023 will be better than that in 2022, and the tone of economic operation may be based on gradual restoration, of which domestic demand is expected to become the main growth point, and the direction of economic restoration will generally follow the direction of real estate and consumption. An industrial chain is carried out.
From a policy perspective, monetary policy and fiscal policy are expected to remain loose, and inflation risks are expected to be controllable.
In addition, travel consumption is expected to pick up.
In terms of the external environment, the risk of overseas economic recession intensifies in 2023, and the Fed's policy may shift.
Fusheng Assets said that overall, the recovery of the economy in 2023 may be late, but it will definitely not be absent. Economic growth will become the core focus of the government's work in the next stage.
The A-share market is expected to rise
Standing at the beginning of the year, a number of tens of billions of private equity have unanimously given "bullish" positive expectations for the performance of A shares in 2023.
Well-known quantitative private equity Black Wing Assets stated that the current A-share market is still in the bottom area, "There are many quantitative indicators that can be determined based on the bottom judgment."
In terms of valuation, the overall price-earnings ratio of Wind All A is about 13.5 times, which is relatively close to 12.03 times at the bottom of 2018; the price-to-book ratio is about 1.6 times, which is close to 1.4 times at the bottom of 2018.
In terms of risk premium, the latest risk premium of A shares is located near "the average value of the past three years has doubled the standard deviation".
On the whole, with the continued efforts to stabilize growth policies, market confidence is expected to be gradually restored in 2023, and A-shares are expected to stabilize in shocks and gradually rebound in the later period.
Dunhe Asset Management predicts that A-shares and Hong Kong stocks are expected to "reverse" after experiencing continuous adjustments in 2022.
Historically, when external demand declines significantly, the stock market will often see a turning point from bearish to bullish, because the government's work focus will be fully shifted to steady growth, and risk appetite in the stock market will be significantly boosted.
As far as 2023 is concerned, the pace of this round of A-share rise may be slower than before, mainly due to the slow recovery of real estate.
In terms of style, Dunhe Asset Management is relatively more optimistic about value stocks and the direction of policy promotion in 2023.
In addition, the agency also believes that under the background that US bond yields and the US dollar may fall simultaneously in 2023, the liquidity of Hong Kong stocks will be more abundant, and the performance of the Hong Kong stock market may be relatively better than that of A shares.
According to Starstone Investment, 2023 will be a year of economic restart and a year of hope for equity investment.
From the perspective of quantitative analysis, in the past 20 years, the Wind Partial Equity Hybrid Fund Index has experienced a rebound of over 100% every time the maximum retracement exceeds 30%.
On the other hand, if the turnover rate is used to represent market sentiment, market sentiment is highly correlated with the market trend, and the market will start brewing at this time when the bottoming period is cold and shrinking.
Judging from the market sentiment reflected in the Shanghai and Shenzhen 300 Index, the market sentiment is expected to continue to recover.
Chongyang Investment predicts that in 2023, "a new round of mid-level market is brewing" in the A-share market, and the market may usher in a "Davis double-click" in which valuation expectations and corporate performance expand together.
Focus on the field of domestic demand repair
From an investment point of view, a number of tens of billions of private equity funds generally have relatively consistent optimistic expectations for areas related to post-epidemic recovery in terms of their investment directions in 2023.
Starstone Investment stated that the supply side of the consumer industry in this economic cycle is better than any previous period. Under the dual effects of supply and demand, the performance elasticity of the consumer industry in 2023 will be significantly enhanced.
Specifically, due to the impact of the epidemic since 2020, the willingness and ability of enterprises to spend capital is relatively weak, the industry supply curve is more inelastic, and the pricing power of leading enterprises has increased significantly.
In the context of a sharp clearing of supply, once the demand recovery has crossed the equilibrium point, a small increase in demand may lead to a rapid rise in prices.
In this context, we can focus on domestic demand areas whose valuations are in historically low quantiles.
Shi Feng Assets believes that "expanding domestic demand" on the consumer side will become the top priority of economic development in 2023, and domestic consumption is bound to usher in a substantial recovery.
At the same time, Shi Feng Assets also believes that under the background of national security development, industrial upgrading is expected to remain the long-term main line of the A-share market, and further support policies will be implemented one after another.
Chongyang Investment said that after the epidemic, there is still a lot of room for in-depth exploration of related topics, which includes not only the consumption field, but also possible compensatory investment in certain industries after the epidemic, and areas where the industry supply pattern has improved significantly during the epidemic.
Since the end of 2022, the market has not fully priced companies that have indirectly damaged demand in the epidemic or cleared industry supply, which may become an important source of income in the later market differentiation.
In addition, the agency is also optimistic about companies with both short-term recovery flexibility and long-term growth logic, especially companies related to the field of technological self-reliance and self-improvement.
China's "hard technology" companies are rapidly iteratively upgrading. Under external pressure, the leading companies among them are expected to become winners in the development process, and the long-term growth logic is smooth.
The epidemic in the past three years has interrupted the short-term growth rhythm of many companies. Looking forward to 2023, the recovery of the macro environment will significantly benefit such enterprises, which are expected to provide very considerable medium and long-term returns.