China Strategy Spotlight:3Q first read;performance,valuation,earnings and liquidity reviews

类别:投资策略 机构:德意志银行 研究员:Michael Tong,Luka Zhu 日期:2017-11-14

19th CCP Party Congress, revised GDP growth and 3Q earnings quick take

    At the 19th CCP Party Congress, President Xi gave a speech outlining a planfor China in the long term, without mentioning the 2020growth target as hispredecessor did in the past. 3Q GDP came in at 6.8% yoy in real terms, in linewith expectations. Our Chief China Economist Zhiwei Zhang now expects 6.6%growth in 4Q and 6.8% for the full year. 3Q earnings season has just gottenunderway; 300+ A-shares have announced results, for which earnings grew59% yoy in 3Q, vs. 45% yoy in 2Q on a comparable basis, with cyclical(steel/chemical/paper) being the most robust sectors. We include some of ouranalysts’ 3Q results commentary on page 4and also key earnings upgradesestimate over the past month on page 7.

    Performance and valuations: HSCEI/MXCI/CSI300gained 3.8%/2.5%/2.6%

    In the past four weeks, HSCEI gained 3.8%, outperforming MSCI China(+2.5%), A-shares (+2.6%) and EM (+1.3%). Environmental, insurance, banksand select defensives led, while real estate, transportation and telecom postedlosses. The MSCI China (ex. ADRs) 12m forward P/E stands on par withhistorical average at 11.5x while P/B is at 1.5x, or a 12% discount to thehistorical average. A-share CSI300rose 2.6% in RMB terms in the past fourweeks, led by defensives, insurance and large-caps. The index trades at 13.6xand 1.7x 12m forward earnings and book value, respectively. Despite strongYTD performance, we believe MSCI China remains very attractive in terms ofdiscount to its historical average as compared to other global indices.

    Macro and earnings: 3Q macro in line; material/property led earnings upgrade

    Macro data was largely in line for 3Q/Sept: 1) PMI stayed strong as NBS PMIrose to a multi-year high. IP slightly beat at 6.6% yoy and is notably above lastmonth’s 6.0%; 2) New loans and TSF beat expectations again. Adjusted TSFbalance growth was stable at 14.8% yoy while corp. M/LT loan balance wasgrowing at an elevated 17.4% yoy; 3) Investment diverged as FAI growthslowed across the board, but property investment improved by 0.2ppt to 8.1%YTD yoy. MSCI China 2018E consensus EPS remain largely unchanged in thepast four weeks, though materials and real estate saw notable upgrades.Liquidity and sentiment: H-shr and A-shr liquidity and sentiment largely stableHK equities’ ADT averaged HKD93bn in Oct’ MTD, a touch lower than lastmonth but still strong compared with the YTD average. Connect inflowscontinued both ways while volatilities subsided. A-share sentiment was stable.Onshore rates and credit spreads both moderated.

    End-FY17index targets, sector preference and weightings

    We reiterate our end-17MSCI China/HSCEI targets at 83/11,900. Werecommend overweight internet, financials, consumer services (education),metals and mining (steel, non-ferrous) and water/IPPs, and we wouldunderweight telecom, coal, airlines, traditional retailing and staples. We expect2017/18growth of 18.5%/15.1% for MSCI China. Our recommended subsectorpreference and weightings for MSCI China are shown in Figure 2.


    Key downside risks: 1) tighter-than-expected monetary policy; 2) harsher-thanexpectedproperty tightening; 3) any disorderly deleveraging as China tightensshadow credit; and 4) sharper-than-expected RMB depreciation.



科斯伍德 买入 11.70 研报
大参林 买入 50.31 研报
生益科技 买入 16.80 研报
步步高 中性 -- 研报
复星医药 买入 -- 研报
中科创达 持有 31.40 研报
泰格医药 买入 -- 研报
中信证券 买入 -- 研报
泰格医药 持有 -- 研报
双汇发展 买入 28.12 研报
闻泰科技 买入 -- 研报


泰格医药 0 1.15 研报
科伦药业 2.40 2.28 研报
海信电器 1.41 1.41 研报
小天鹅A 0.97 0.72 研报
荣泰健康 0 0 研报
欧普照明 0 0 研报
万和电气 1.16 1.17 研报
四川长虹 0.11 0.10 研报
TCL集团 0.12 0.11 研报
青岛海尔 1.36 1.15 研报
华帝股份 0.65 0.63 研报


中信证券 34 持有 买入
隆基股份 32 买入 持有
华泰证券 32 持有 买入
贵州茅台 31 持有 买入
伊利股份 31 持有 买入
万科A 30 买入 买入
格力电器 30 持有 中性
五粮液 30 持有 买入
上汽集团 29 持有 买入
通威股份 28 买入 持有
三一重工 27 持有 中性
美的集团 27 持有 中性
中信证券 26 持有 买入
泸州老窖 26 持有 持有
华能国际 25 持有 中性
中国国旅 25 持有 持有
洋河股份 23 持有 买入


电子信息 596 79 306
汽车制造 522 37 299
金融行业 436 28 197
建筑建材 433 53 211
电子器件 418 55 238
化工行业 377 63 117
钢铁行业 373 29 166
机械行业 326 42 109
生物制药 311 49 144
房地产 287 31 205
家电行业 279 11 132
酿酒行业 258 15 110
煤炭行业 242 23 104
有色金属 234 49 76
服装鞋类 231 18 110
食品行业 202 23 69
酒店旅游 195 20 57