Collection of 2024 Medium term Strategies for People's Livelihood Research

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Macro Zhao Honghe (Analyst Jin Qilin)

Macroeconomic Outlook in the Second Half of 2024: "Change" and "Constant" in the Second Half of 2024 20240617

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1. With the accelerated evolution of changes in the past century, geographical, political and other high-dimensional variables do not appear suddenly, but gradually change from "unchanged" to "changed", which is "cause"; The core variables under the traditional macro research paradigm, such as policy choice and economic trend, have instead become the "fruit" of high-dimensional variables.

2. In the second half of the year, in the face of potential changes in the global geopolitical situation, short-term policy options such as real estate and local debt may change. What remains unchanged is to promote high-quality development by developing new quality productivity, and to further comprehensively deepen reform to promote Chinese style modernization.

Risk warning: Domestic economic changes exceed expectations; Changes in overseas geopolitical situation exceeded expectations.

Strategy Mou Yiling (Analyst Jin Qilin)

2024 A-share Medium term Strategy Outlook: Mid stream Water Attack 20240617

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1. In this round of economic recovery, the manufacturing industry has accepted the physical demand, but its profit has declined. The difference between PPI and PPIRM has narrowed. "Price for volume" is a common feature of internal and external demand.

2. China's manufacturing industry is still resilient. Despite the challenges of de financialization, its growth is supported by the potential of global demand. In the global trade change, China's export manufacturing capacity and efficiency are concerned, and changes in the division of labor in the industrial chain may affect the return on capital.

3. In terms of investment ideas, attention should be paid to downstream price acceptance of resource producers, spatial mismatch of transportation industry, construction of power infrastructure and clearing of traditional manufacturing industries. Market pricing should focus on the long-term trend of profit distribution and the absolute valuation level.

Risk warning: Oversea recession of overseas economy; Domestic debt risk exposure; Overseas monetary policy tightened beyond expectations; Measurement error.

Fixed income Tan Yiming

Medium term investment strategy for interest rate bonds in 2024: How to change the situation when the debt is not exhausted? 20240617

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1. Looking ahead to the second half of the year, if there is no more than expected change in the macro picture and policy force, it is expected that under the pressure of wave like economic recovery, stable and balanced capital surface, and strong institutional under allocation, there will be no end of debt, but there will be more disturbance factors, focusing on marginal changes in physical financing demand, real estate sector, and price signals.

2. The interest rate in the third quarter fluctuated as a whole or extended range, and the price performance ratio of interest rate extension may not be high. The coupon strategy and variety selection may be the key, while maintaining appropriate leverage. The bond market environment in the fourth quarter may be better than that in the third quarter, and the bond market interest rate may still have further downward space. The extension strategy may be relatively dominant.

Risk warning: Policy uncertainty; Changes in fundamentals exceeded expectations; Overseas geopolitical conflicts.

《 Urban investment securities selection strategy series: how will urban investment look forward to this? 20240618》

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1. Although the coupon and interest margin have reached a record low, it is a basic premise to allocate.

2. It is necessary to consider the price performance ratio and adaptability, match the right asset with the right account, and find the price performance ratio.

3. Specifically, on the one hand, in the middle and high level subjects with acceptable qualifications, duration is the king, giving consideration to coupon and liquidity; On the other hand, when there is a corresponding appeal account, we should look for some duration and grade superposition along the policy and market direction to obtain high coupon. Although the cost performance ratio is limited, we may pay more attention to scarcity and reinvestment risk.

Risk warning: Urban investment caliber deviation; Platform type definition error; Error in interest margin calculation; Data availability deviation.

Metalworking Ye Erle

Financial Engineering 2024 Medium term Investment Strategy: Attack and Defense in a "Stable Era" 20240617

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1. Macro quantification: A-share entered a "stable era". The boom degree is structurally differentiated, and it has lasted for more than October in industry and finance. "Stable era" investment pays more attention to defense, and undervalued and high dividend assets attract much attention. Future investment value: upstream>utilities>downstream>midstream.

2. Quantification of equity: low wave characteristics or continuation of "stable era". The volatility of the current market and the degree of prosperity are both at historical lows, and the indicative effect is weakened. We should try to avoid shrinking markets

3. In the future, the downward space of treasury bond interest rate may also be limited, and the probability of continuous bottom oscillation is large; Keep bullish on gold; In terms of industry, the allocation of growth industries has higher expected returns.

4. In the short term, the value style still has a high winning rate. In the second half of the year, it is optimistic about the market, with dividends exceeding expectations.

Risk warning: The quantitative conclusion is based on historical statistics. If the future market environment changes, failure may not be ruled out.

Bank Yu Jinxin

Medium term Investment Strategy for Banking Industry in 2024: The Year of Bottom Building, the Recovery Period 20240615

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Since 24 years ago, the PB of listed banks has been gradually repaired to 0.56x, but it is still at a historical low. In 24 years or the year when the performance bottoms out and stabilizes, if the performance is gradually repaired later, the valuation of the sector is expected to rise accordingly.

Three main lines: 1) The bonus is still cost-effective. The average dividend yield of state-owned banks is still superior to the yield of 10-year treasury bonds; Slower scale expansion and new capital regulations are expected to bring about capital savings, and banks are more capable of maintaining high dividend ratio. 2) The industry performance of high-quality regions is expected to continue. The loan growth rate across the country is down, and some high-quality regions such as Jiangsu and Zhejiang still maintain a high loan growth rate, and local banks are expected to benefit fully. 3) Real estate policy optimization, valuation repair or acceleration. If the sales and liquidity of real estate enterprises improve, the potential risk of real estate loans is expected to be reduced.

Risk warning: macroeconomic fluctuations exceed expectations; The decline of industry net interest margin exceeded expectations; The real estate industry improved less than expected.

real estate

《 Medium term investment strategy of real estate industry in 2024: bottom reversal - industry bottoming, policy+market boosting performance starting again 20240617》

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1. Policy level: unprecedented deregulation efforts - 1) from January to April 2024, the central and local governments will intensively introduce demand side deregulation policies; Compared with the previous two rounds of policy easing, this round of policy easing is more powerful and more willing to support the market;

2. Market level: the policy superimposes a low base, and the year-on-year decline of new house sales in the second half of the year may narrow; Policies help to stabilize the price of second-hand housing;

3. At the level of real estate enterprises: land acquisition shrinks to reduce expenditure, sales recover to increase payments, and the performance is expected to recover after withdrawal - 1) the willingness of real estate enterprises to acquire land needs to be improved urgently; 2) Sales fluctuated and rebounded since February 24;

Risk warning: Risk of tightening control policies, risk of change in pre-sale mode, risk of sharp decline in house prices, risk of rising land prices, risk of tightening overseas financing, and risk of further market downturn.

Metal Qiu Zuology (Analyst Jin Qilin)

Energy Metal Part of the 2024 Medium term Strategy Series Report of the Metal Industry

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1. Lithium: domestic demand exceeded expectations+the impact of environmental protection events in Jiangxi, and lithium prices rebounded. The cumulative sales volume of 2024M1-M4 domestic new energy vehicles was 2.939 million,+32.3% year on year, which exceeded the market expectation. The midstream material factory took the initiative to replenish the inventory. In addition to the production reduction expectation brought by the Jiangxi environmental protection event in March, the lithium price stopped falling and rebounded slightly.

2. Cobalt: The demand for consumer electronics and new energy recovered somewhat, but the supply increased significantly, the cobalt price fell to a historical low, and the news and strength of stock collection stimulated the cobalt price to rebound slightly.

3. Nickel: Indonesia's nickel mine RKAB approval was slow. Since March, Indonesia needs to import nickel ore from the Philippines to make up for its raw material gap. Indonesia's nickel mine supply is tight, and the focus of nickel price has moved up.

Risk warning: The price dropped sharply, the terminal demand was less than expected, and the project progress was less than expected.

Industrial Metals Part of the 2024 Medium term Strategy Series Report on the Metal Industry: Let the East, West, North and South prevail, and stick to the Castle Peak 20240613

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1. Review of H1 in 2024 and prospect of H2 in 2024: Let the wind blow from east to west, from north to south, and stick to the green mountains.

2. The main force of marginal growth of commodity demand has switched from emerging areas to the re industrialization of overseas emerging regional economies.

3. Copper: The financial repression has eased, the gap between supply and demand has widened, and the price center will continue to move upward.

4. Aluminum: production capacity is approaching the ceiling, and long-term value is expected.

Investment suggestions: Looking into the second half of the year, domestic and foreign demand will be better, and supply side constraints will still be strong, so it is recommended to buy industrial metal plate targets.

Risk warning: Metal prices fell sharply, terminal demand was less than expected, and overseas deflation was expected to intensify.

Metal Industry 2024 Medium term Strategy Series Report - Steel Part: "Energy Saving and Carbon Reduction" Constrains Supply, Industry Profits Are Expected to Improve 20240614

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1. Demand side: the decline of steel demand in 2024 is limited.

2. Supply side: "energy conservation and carbon reduction" improves the supply pattern of the industry.

3. Raw material end: supply elasticity increases.

4. Investment advice ： Some areas are still booming, focusing on the upgrading of the manufacturing industry.

5. Ordinary steel plate: it is suggested to focus on the industry leaders Baosteel 、 Valin Steel 、 Nangang Co., Ltd Etc.

6. Special steel plate: it is recommended to focus on targets with good performance, such as Jiuli Special Material 、 Changbao Shares 、 Xianglou New Material 、 Wujin Stainless Etc.

Risk warning: The demand for steel for real estate is less than expected; Steel prices fell sharply; The price of raw materials fluctuated significantly.

Small Metal Part of 2024 Medium term Strategy Series Report of Metal Industry: Supply Cycle, Colorful 20240614

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1. The supply curve of nonferrous metals is becoming steeper. The supply cycle is open, and the characteristics of the steep supply curve of small metals are more significant. Thanks to the rapid growth of demand driven by emerging fields, small metals have a high price elasticity.

2. Tungsten: The shortage at the mine end is difficult to improve, and the price of tungsten has been improving for a long time.

3. Molybdenum: The demand for special steel is steadily improving, and the supply and demand are in tight balance.

4. Tin: supply disturbance aggravates the shortage situation, and demand recovery helps tin prices rise.

5. Antimony: The increase in supply is limited, and the gap between supply and demand may continue.

6. Uranium: The supply recovery is slow, and the recovery of nuclear power installation is good for the upward price of uranium.

Risk warning: Overseas geopolitical risk, metal price fluctuation risk, downstream demand less than expected.

Metal Industry 2024 Medium term Strategy Series Report Precious Metals: Determination of Interest Rate Reduction, the Upward Trend Has Not Changed 20240616

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1. The US economy has shown a downward trend, and the interest rate cut cycle is about to start. The real GDP growth of the United States slowed down in the first quarter, and the downward pressure on the economy gradually emerged. On the consumer side, the consumer confidence index and the growth rate of personal disposable income have continued to decline since the beginning of the year. On the investment side, the PMI of the service industry has continued to decline since the first quarter, entering a contraction range. The rebound of the U.S. inventory cycle at the bottom is expected to drive the growth of domestic private investment and the rise of the PMI of the manufacturing industry.

2. The central bank expanded its balance sheet seriously, and the credit of sovereign currency declined.

3. Central bank purchases will continue and gold reserves will remain large.

4. Silver: high elasticity, silver price is expected to break through the previous high.

Risk warning: The risk of the Federal Reserve's interest rate policy exceeding expectations, the risk that the central bank's purchase demand is less than expected, and the risk that the global manufacturing recovery is less than expected.

Energy exploitation Zhou Tai

Medium term Investment Strategy for Coal Industry in 2024: Supply Disturbance, Expansion of Steam Coal Demand Gap 20240615

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1. Since 2024, a number of regulations have been issued to actively require safe production and curb overproduction. Looking ahead, the negative growth of subsequent raw coal production will continue under the disturbance of safety and environmental protection inspection.

2. The output is expected to change from a slight increase at the beginning of the year to a negative growth. Against this background, the tight supply and demand situation will remain unchanged in 2024, and the supply and demand gap will further expand compared with the prediction at the beginning of the year. The balance between supply and demand of steam coal will change to insufficient supply, and the demand gap will expand.

3. The price of coal stopped falling in April. Another round of off-season stress tests from late April to May verified the bottom of the price of coal again. Later, under the pressure of hydropower, the increase of the price of coal may slow down, but the price is expected to accelerate in July when the summer peak is approaching.

Risk warning: 1) Risk of economic slowdown; 2) Risk of sharp decline in coal price; 3) Assumptions deviate significantly from the actual situation; 4) Overseas demand recovered less than expected.

Building materials Li Yang (Analyst Jin Qilin)

2024 Medium term Investment Strategy for Building Materials and New Materials Industry: Half year Dimension, 9 Highlights 20240617

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1. Cement: spend the off-season by rising and stopping falling, and the price expectation in peak season is gradually formed;

2. Consumer building materials: "follow the ground" and build momentum at the bottom;

3. Pharmaceutical glass: domestic demand for medium borosilicate is increasing, leading enterprises are actively going to sea;

4. Glass fiber: the winner and loser are in demand in the second half of the year;

5. Civil explosion industry: supply is tight, demand is rising, and the western market is being tapped;

6. UTG: The production capacity is accelerated, and "black technology" is expected to be reduced;

7. Low altitude economy: catalytic architectural design+new material carbon fiber link;

8. Nuclear construction: one of the key points to promote energy transformation;

9. Export and sea going.

Risk warning: Risk of price fluctuation of raw materials; The change of real estate demand is less than expected; The risk of fierce market competition.

Chemical Liu Hairong (Analyst Jin Qilin)

The Medium term Investment Strategy for the Chemical Industry in 2024: Layout "Five Tigers for Growth" and Pay Attention to "Price Increase to Realize" 20240617

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1. Distribution of growth stocks with performance support+growth space+reasonable valuation: (1) Guoguang Shares （2） Polymerized cis （3） Shengquan Group （4） Porcelain materials （5） Amway ；

2. Energy consumption indicators continue to tighten, leading white horse enterprises usher in value revaluation: On May 29, the State Council issued the Action Plan for Energy Conservation and Carbon Reduction 2024-2025. Against the backdrop of energy consumption indicators tightening, leading white horse enterprises in chemical industry are expected to benefit fully, and it is recommended that Wanhua Chemical 、 Hualu Hengsheng ；

3. The industry continues to improve. It is recommended to focus on nylon, polyester, chrome salt and sugar substitute industries.

Risk warning: The price of raw materials continued to rise, and downstream consumer demand did not meet expectations, resulting in measurement errors.

Agriculture Xu Jing

Medium term investment strategy for agriculture in 2024: pig breeding is booming, and transgenic commercialization continues to advance 20240617

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1. In 2024, we believe that the pig breeding industry and the whole pig cycle will usher in a major turning point. In the new normal of the cycle, the current profit will not be the only factor driving the behavior decisions of individual farmers, and various types of subjects in the industry are more affected by the expected guidance.

2. The 2024H2 pig price is expected to continue to rise, which will benefit the upstream animal health enterprises. It is suggested to focus on the right side of the pig cycle.

3. Looking forward to the second half of the year, the supply of commercial seedlings may continue to decrease.

Risk warning: Policy regulation led to the risk that the pig price rebounded less than expected; Risk of major sudden animal epidemics; Risk of raw material price fluctuation caused by weather disasters.

Computer Lv Wei (Analyst Jin Qilin)

Medium term Investment Strategy for Computer Industry in 2024: New Era, New Technology, New Valuation 20240617

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New quality productivity is generated by revolutionary breakthroughs in technology, innovative allocation of production factors, and in-depth transformation and upgrading of industries, or drives the revaluation of the value of science and technology in the new era: artificial intelligence may drive an unprecedented terminal hardware revolution, and the rise of domestic AI computing power is still the most sure main line. Quantum industry is expected to become the "engine" of new quality productivity, Satellite Internet and ICT entered the stage of large-scale implementation. We recommend Zhongke Chuangda 、 Cambrian 、 IFLYTEK 、 Inspur Information 、 Fluorite network 、 Hongruan Technology And other leading enterprises in strategic science and technology direction.

Risk warning: Industry competition intensifies, technical route is uncertain, and customer capital expenditure is less than expected.

Electronic competition

Medium term Investment Strategy of Electronics Industry in 2024: New Paradigm of AI Industry 20240618

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1. Model change, cloud integration as the trend;

2. Cloud transformation, GB200 solves the bottleneck of interconnection;

3. Supply chain reform: fully upgraded computing industry chain;

4. End to side change: the computing terminal around you.

Investment suggestions: In terms of subject matter, it is recommended to focus on: 1) Cloud: Industrial Fulian , Cambrian Shanghai Electric Power Co., Ltd 、 Shenghong Technology 、 Montage Technology 、 Wall Nuclear Material ； 2) Supply chain: SMIC International 、 Huahong Company 、ASMPT、 Changchuan Technology 、 Xingsen Technology ； 3) Terminal: Lenovo Group, Xiaomi Group Lixun Precision 、 Pengding Holding 、 Leading, benefiting, intelligent and manufacturing 、 Lens Technology 、 Huaqin Technology 、 Crystal photoelectric 。

Risk warning: Downstream demand is less than expected; The development of large models is not as expected; The expansion of the wafer factory is not as expected; New product research and development progress is less than expected.

Communication Ma Tianyi (Analyst Jin Qilin)

Medium term investment strategy of communication industry in 2024: The era of optical copper connection has come, waiting for the "empty" and "wind" to strike 20240607 alternately

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1. The investment in the communication sector still takes operators as the main body of investment, and takes the evolution and change of frequency and frequency band as the basis of innovation to realize the investment opportunities of one body and two wings, which are respectively the infrastructure side and application side of the operation link. In the past two years, with the gradual completion of domestic 5G network construction (there are 5G base stations at present), the network construction of operators has undergone profound changes;

2. New network construction entities have emerged, from the traditional three operators to those with Internet manufacturers as the core. Alibaba/Tencent/Byte/Baidu/Huawei and other network construction entities have been added domestically, and Nvidia/Google/Microsoft/Amazon and other network construction entities have been added overseas.

Risk warning: The implementation of new infrastructure, digital economy and other policies was not as expected; The market demand of communication and data communication is not as expected; AI downstream applications have not developed as expected; The progress of satellite Internet industry was not as expected.

Media Chen Liangdong

Medium term Investment Strategy for the Media Industry in 2024: Reflections on Switching to Production Factors of New Quality Cultural Content 20240617

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1. We believe that we should switch to a new perspective of cultural content production to consider the change and deduction of production factors.

2. Element 1: technology and process - the main line is still the pipeline innovation of the industrialization of cultural content production with technology.

3. Element 2: content and experience - re expansion of the pan population and new forms of taste.

4. Element 3: Channel and market - the exploration of new value space is the way to explore growth.

5. Sorting out the investment direction of the sector: 1) In the direction of AI, it is suggested to focus on companies that continue to layout large domestic models, and attach importance to IP and copyright value; 2) New quality content oriented small games have structural growth opportunities, and short plays have a big market when they go to sea. 3) New market and new channel exploration direction: companies that attach importance to actively promoting content to the sea and deeply layout overseas high growth markets.

Risk warning: AI technology development is less than expected, MR equipment experience is less than expected, industry competition intensifies, innovative application launch time and performance are less than expected and other risks.

Overseas Yi Yongjian

Interim Strategy Report of K12 Education and Training Industry in 2024: The industry beta remains unchanged, waiting for the peak summer season 20240615

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1. The general direction of the policy is clear. Disciplinary training at the compulsory education stage is the red line, while non disciplinary training and high school disciplinary training at the compulsory education stage can be.

2. The demand for K12 training has not changed, and the size of the discipline market is about 400 billion yuan. After the "double reduction", the effective supply of compliance has been largely cleared, and there is a mismatch between supply and demand.

3. At the compulsory education stage, the issuance of non discipline licenses was resumed, but the total amount was controlled. It was difficult for new institutions to enter, and high school discipline licenses were no longer added. The stock of compliance institutions competed. The pattern was significantly optimized.

4. From the perspective of winter vacation performance, the industry beta continued, the revenue maintained rapid growth, profitability continued to improve, and the trend of deferred revenue and capacity expansion was good. Be optimistic about the performance in the following summer peak season.

Risk warning: Stricter policies; New business expansion is not as expected; Industry competition intensifies; Product quality declines.

Auto Cui Yan (Analyst Jin Qilin)

Medium term Investment Strategy for Auto Parts Industry in 2024: Intelligent Relay Electrification Globalization from 1 to 100 20240610

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1. Review 2023&2024Q1: performance&valuation resonance, better track performance;

2. Outlook 2024: The main line of intelligent electrification will be globalized from 1 to 100;

3. Intelligent electric innovation reshapes the competition pattern: customers are optimistic about the new power industry chain such as Tesla and Huawei; The product dimension is optimistic about intelligence, electrification and human shape robot track;

Investment suggestions: Intelligent electric power reshapes order, opens space for overseas layout, constantly strengthens medium-term growth, and is optimistic about new power industry chain+intelligent electric power increment.

Risk warning: The sales volume of the global and domestic passenger car industry was lower than expected; The increase of intelligent penetration rate was less than expected; Customer expansion is not as expected; Risk of intensified market competition.

Dianxin Deng Yongkang

Medium term investment strategy for the new power industry in 2024: the beginning of the cloud and the depth of the still water 20240616

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1. New energy vehicles: the growth is determined, and the strong will remain strong.

2. PV+wind power+energy storage: haze disappears and dawn appears, waiting for the spring breeze to come. Photovoltaic: the bottom of the fundamental plane appears, and the upward signal is observed. Wind power: demand drives supply, and supply creates demand. Energy storage: focus on marginal improvement between waves.

3. Electric power equipment: a new chapter of power grid and a new engine for going to sea.

4. Low altitude economy: the strategic position is unprecedented, and industrialization is close at hand. Local governments intensively respond to the call of the central government; In the industry, independent and controllable accumulation is well developed, and eVTOL is a commercial enterprise.

Risk warning: The policy did not meet expectations, the price fell more than expected due to intensified industry competition, the new capacity/new technology promotion was less than expected, the price of raw materials fluctuated more than expected, and the global geopolitical uncertainty increased.

Mechanical Li Zhe (Analyst Jin Qilin)

Medium term Investment Strategy for Machinery Industry in 2024: Now Going from scratch 20240616

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1. We continue to maintain the macro judgment that China's industrialization has been basically completed, the overall growth rate of manufacturing capital expenditure has slowed down, and equipment orders show cyclical characteristics. It also believes that the structural opportunity of the equipment industry is stronger than the total opportunity. Under the condition that the total volume is stable, we believe that structural opportunities mainly come from three aspects: 1) the demand for restructuring the global industrial chain; 2) Equipment update requirements; 3) Demand for the development of new quality productivity.

2. Construction machinery, machine tools, agricultural machinery, ships and other sectors are expected to benefit from the demand for restructuring the global industrial chain;

3. The rail transit equipment and process industrial equipment are expected to benefit from the demand for equipment renewal;

4. Humanoid robots, low altitude economy and semiconductor equipment are expected to benefit from the development of new quality productivity.

Risk warning: 1) Macro cyclical fluctuation risk; 2) Risk of low sustainability of industry prosperity; 3) The risk that the underlying performance of related companies is not as expected.

Military industry Yin Huiwei

Medium term Investment Strategy for National Defense Industry in 2024

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1. In the second half of 2024, the situation will improve; Industry demand recovery is poised;

2. Pay attention to the redistribution of the value of the industrial chain, and look forward to the long-term growth value of the middle and lower reaches;

3. "New quality productivity" leads new development; Focus on grasping the opportunities of industrial transformation;

4. It is suggested to focus on the middle and lower reaches of the industrial chain and the leading state-owned enterprises, and pay special attention to the changes in the industrial development stage and application penetration rate of new technologies, new ideas and new directions represented by new domains and new quality productivity.

Risk warning: Uncertainty of product delivery, decline of product prices, changes in industrial policies, etc.

Home appliances Wang Haiyang

Medium term Investment Strategy for Household Appliance Industry in 2024: Pursuing Robust Assets and Growth Dividends 20240614

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1. Main line 1: high dividend+deterministic white electricity assets. As of June 11, the white goods index (Shenwan) had increased by 26.36% in the year, ranking first among all Shenwan secondary industries. The market's recognition of the operational resilience and profitability stability of white goods assets continued to improve.

2. Main line 2: Home appliance enterprises go to sea. In recent years, the total amount of household appliances exported by China to emerging countries and regions such as the Middle East, Africa and South America has significantly increased, and the dividend of increasing household appliance penetration in emerging countries and regions has continued to release.

3. Main line three: marginal repair of real estate boom. The strength of the new policy "combination boxing" is stronger than in the past, and the prosperity recovery brought by the release of policy effects is expected.

Risk warning: 1) Risk of price fluctuation of main raw materials; 2) Risk that demand is less than expected; 3) Market competition intensifies risks.

Medicine Wang Ban

Medium term Investment Strategy for the Pharmaceutical Industry in 2024: Continuously Improving Fundamentals, Encouraging and Supporting Policies, and Taking a Full Look at the Pharmaceutical Bottom Assets 20240614

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1. Policy encouragement and support, continuous improvement of fundamentals, and comprehensive focus on the bottom assets of medicine: continuous encouragement and support of policies such as medical equipment update, full chain support of innovative drugs, continuous improvement of fundamentals of the pharmaceutical industry, continuous recovery of hospital drugs, devices, medical instruments and equipment, anti-tumor, self immunity, myopia prevention and control The clinical research and development and sales of large single products such as GLP-1 are progressing constantly, and the bottom assets of medicine are more comprehensive.

Risk warning: The pressure of centralized production is greater than the expected risk; Risk that the product R&D progress is not as expected; Risk of intensified competition; Risk of changes in policy regulatory environment; Risk of declining market demand for drug R&D services.

Liu Wenzheng (Analyst Jin Qilin)

2024 Medium term Investment Strategy for Social Service Industry: Focusing on the Long term Development of Cultural Tourism Sector and Investment Opportunities in Education Sector 20240617

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1. OTA leaders with stable pattern and further expanded business scenarios: with the increase of tourism online rate, scenarios&traffic sources&business categories are further expanded, and market space and business types are opened to expand; Suggestion: Ctrip Group, Tongcheng Travel, etc.

2. Pay attention to the core scenic spots with clear orientation of the interior landscape. Under the background that tourism consumption has a clear growth drive, there are still band investment opportunities based on the travel performance in peak season/holiday in the year, so it is necessary to grasp the time point of passenger flow in the year for allocation; Suggested attention: Changbai Mountain 、 Jiuhua Tourism , Mount Emei, Mount Huangshan Western Region Tourism Etc.

3. Pay attention to tourism products that meet the new consumption trends of various customer groups in the future.

Risk warning: 1) Risk that macroeconomic growth rate is lower than expected; 2) Risk of entry and exit recovery failing to meet expectations; 3) Leading expansion/project promotion is not as expected; 4) Risk of policy environment change; 5) Industry competition intensifies risks.

The Mid term Investment Strategy for the Commercial Retail Industry in 2024: Follow the trend and actively embrace new models and changes 20240617

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1. The return of offline channels and cost-effective consumption. For industries with strong offline attributes such as general merchandise retail, gold jewelry, etc., the dividend of online channels has gradually faded, the value of offline channels has returned, and cost-effective retail is still the main investment line for 24 years; 2. The logic of going to sea: sellers with cost-effective platforms and supply chain advantages in the cross-border e-commerce sector will accelerate their speed of going to sea; 3. The trend of consumption differentiation continues. In the context of more cautious consumption, we should look for less affected targets. It is suggested to focus on medical beauty cosmetics enterprises that actively layout new materials such as recombinant collagen and continue to promote new and iterative products; 4. From quantity increase to high-quality development. The gold and jewelry industry has gradually transitioned from the dividend period of accelerating the channel sinking to the pursuit of store expansion, as well as the promotion of single store efficiency.

Risk warning: The terminal demand was less than expected, the promotion of new products was less than expected, and the competition pattern deteriorated.

Food and beverage Wang Yanhai

Medium term Investment Strategy for Food and Beverage Industry in 2024: Spring Mountain at the End of Pingwu - long-term layout, tracking and improvement, and selecting individual stocks 20240618

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1. From the perspective of long-term investment, the valuation of the sector continues to adjust, and risks are gradually released, which has a high margin of safety;

2. In the past ten years, the sector has a high ROE level, relatively stable operating cash flow and free cash flow • Robust performance growth+dividend yield, the liquor sector and some public product stocks have a high margin of safety • The stock price's empowerment of short-term factors is significantly higher than long-term slow variables, and its trend is high-frequency tracking mapping of short-term industry inventory, dynamic sales, prices, etc. From this perspective, The short-term market will still favor transaction certainty and marginal improvement;

3. Long term layout, tracking and improvement, and selecting individual stocks.

Risk warning: The recovery rhythm of the consumption scene and the effect of related stimulus policies did not meet expectations; The substantial increase in the price of bulk raw materials will increase the cost burden of mass market enterprises; Risk of industrial policy adjustment such as liquor; The company's reform progress is not as expected; Retailer brand product substitution diversion; Downstream demand recovery is not as expected; Food safety risks.

Light Industry Xu Haoliang (Analyst Jin Qilin)

Medium term Investment Strategy for Light Industry in 2024: Cross border Mainline Continuation, Domestic Demand Waiting for Reversal 20240617

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1. Light industry, as a traditional manufacturing industry, with the gradual maturity of some industries represented by the real estate chain, it is difficult for demand to be more flexible under the current policy expectations; In the past three years, as a big year of capital expenditure, industries such as papermaking have overcapacity and other problems, and the capacity will continue to decline for a long time in the future; In this context, the industry investment has changed from the beta investment of "buying the track" in the past to intensive research on good companies. When the gross profit margin of the industry is suppressed by the supply and demand pattern, the cost control, organizational efficiency and other competitive factors of excellent companies are raised to a more important level, and Guan pays attention to the valuation opportunities of Longyi.

2. New opportunities are also growing. For example, online procurement of office&MRO, cross-border e-commerce and other tracks are entering a rapid growth period, and traditional light industry enterprises are gradually evolving into new fields.

Risk warning: 1) Macro aspect: the risk that demand recovery is not as expected. If the consumption recovery is not as expected, the light industry enterprises may face the risk that the relevant downstream demand is not as expected. 2) Industry: the risk of intensified competition within the industry. Economic pressure brings home furnishing The internal competition in papermaking, consumption and other industries is intensifying, squeezing the profits of enterprises.

Collection of medium-term investment strategies

Important tips, disclaimers and risk tips

Important: The Measures for the Administration of the Appropriateness of Securities and Futures Investors was officially implemented on July 1, 2017. The views and information released through this WeChat subscription number/account number are only for the reference of professional investors of Minsheng Securities, and the complete investment views should be subject to the complete report issued by Minsheng Securities Research Institute. If you are not a professional investor among Minsheng Securities customers, please unsubscribe, receive or use this subscription number/any information in this account number in order to control the investment risk. It is difficult to set access rights for this subscription/account. Please forgive me for any inconvenience caused to you. Our company will not regard relevant personnel as customers because of following, receiving or reading this subscription number/the content pushed by this account; There are risks in the market, so investment should be cautious.

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Risk warning ： The risk of industrial policy change and market demand are less than expected.