CICC Leads All-China Research Team for Third Straight Year

The mid-November activation of theShanghai–Hong Kong Stock Connect, which links the equity markets in those cities and allows investors in one location to trade on the other exchange, has many fund managers excited again about Chinese equities.

“We see this as a big leap forward for China,” affirms Lennie Lim, Singapore-based head of Legg Mason Global Asset Management for Asia ex-Japan. “We see this as increasing opportunities for investors on both sides, and we in turn are trying to provide more access for our global clients to China’s markets.”

Those on the sell side echo that view. “In preparation for theShanghai–Hong Kong Stock Connect“发射，我们扩大了我们的团队和我们的覆盖范围，”Vincent Chan解释说，在瑞士信贷在香港的中国研究负责人。“我们将覆盖范围内的中国公司数量增加了50%以上，达到近300家。”

总部位于香港的陈安琪（Angello Chan）在美国银行美林（Bank of America Merrill Lynch）负责中国股市的报告工作，他说，他的公司看到“鉴于不同的行业改革和企业重组，包括沪港通（Shanghai-Hong Stock Connect）交易计划的启动，全球投资者对中国股市产生了浓厚兴趣。”他补充说，管理着一支由70名分析师组成的团队，他们涵盖了香港上市的H股和内地上市的a股。

这一新的焦点出现在中国股市在经历了令人失望的2013年后正在反弹之际。沪深300指数（csi300）是一个追踪中国最大的沪深两市上市公司市值的指数，今年前11个月上涨了近21%。同期，标普500指数上涨约12%。

自然，投资者渴望参与这一复苏，许多人指望卖方协助寻找成功的投资。他们说，提供最有用指导的分析师可以在China International Capital Corp.，导致亚博赞助欧冠你们的中国研究团队连续第三个ar. The firm captures 25 team positions, the same number as last year and 11 more than美林美银，重复第二位。这家美国银行声称拥有14个席位，比2013年减少了2个。Credit Suisseclimbs one level, to No. 3, but that modest rise belies the organization’s robust gains: Its team total nearly doubles, from six positions to 11 — a feat bested only by fellow Swiss bankUBS, whose total vaults from three to ten. It rockets from ninth place to fourth and is this year’s biggest upward mover. Rounding out the top five is摩根士丹利, which rises one rung after increasing its team total by three, to eight.

Click image to view infographic.

These results reflect the opinions of nearly 850 investment professionals at some 410 institutions managing an estimated $584 billion in Chinese equities. For more information, clickMethodology.

Many market observers are upbeat on China’s prospects for the year ahead. “We remain positive and expect domestically favorable catalysts to continue to unfold,” says Hong Liang, director of research at CICC in Beijing. Her firm employs 68 analysts who follow some 800 Chinese companies, up from 685 a year ago.

她指出，11月末，央行将一年期贷款利率下调40个基点，至5.6%，此举有助于降低尾部风险，并鼓励市场参与者承担更多风险。意外降息令全球股市飙升。

“Ongoing structural reforms will become much broader and more comprehensive, reinvigorating China’s longer-term growth potential,” Liang adds. “Current subdued valuations mean Chinese equities are still an attractive ‘sweet spot’ among global markets, with ample room for further rerating.”

投资者会增加ease their exposure to “cyclical sectors and quality consumer names with solid growth visibility and reasonable valuations,” Liang believes. “Specifically, we would overweight financials — real estate, banks, insurers and brokers — among the ‘old’ plays, and health care in the ‘new’ space.”

China’s economy has undergone apainful restructuringsince President Xi Jinping and Premier Li Keqiang came to power nearly two years ago. Xiunleashed an anticorruption campaignthat has led to the punishment of more than 180,000 officials, and Li has stepped up support of China’s private sector, exempting businesses with monthly sales of less than 30,000 yuan ($4,800) from certain taxes while increasing bank lending to small and medium enterprises. Real gross domestic growth has slowed from 10.4 percent in 2010 to 7.7 percent last year, a downward trend that many economists believe is likely to continue.

“We expect GDP growth to moderate slightly from this year’s 7.3 percent to 7.2 percent in 2015,” says Ting Lu, the top-ranked economist for a second year running. Still, the BofA Merrill researcher believes that there are some short-term factors that might favor growth. The anticorruption campaign is unlikely to have a negative impact in 2015 as the government shifts its focus to economic expansion and institution building, he says, and the property market — which suffered a big downturn this year — will recover to some extent. “Balancing the long-term downward trend in potential growth and better cyclical factors, we expect only a moderate slowdown in 2015,” says Lu, who is headquartered in Hong Kong.

Not all sectors will be affected equally — or at all. CICC’s Xin Yang, the No. 1 analyst in Infrastructure & Transportation for a fourth consecutive year, maintains that many companies in her coverage universe will continue to do well.

她说：“尽管中国经济放缓，但互联网的快速扩张将提振物流业，而最近油价的下跌对航空公司来说是个好消息。”。“集装箱码头也将享受出口的持续反弹。”

Among the Beijing-based researcher’s top picks of the past year is China Merchants Energy Shipping Co., which she upgraded from hold to buy in March on the belief that the company would benefit from rising demand owing to falling energy prices, among other considerations. The shares soared more than 92 percent through November.

“We still hold a positive view about the stock, given that there is significant improvement in demand-supply conditions in the oil tanker market, especially in the very large crude carriers — hence a freight rate hike is expected,” she says.

Telecommunications is another sector with ongoing growth opportunities, according to BofA Merrill’s Xinnian (Sydney) Zhang, who climbs from second place to savor his first appearance at No. 1.

“我们看好中国电信公司，因为政府正在推动所有电信公司提高效率和回报，”这家总部位于香港的分析师报告说。他指出，许多这类公司的交易价格不到2015财年预期收益的4倍，远低于亚洲同行的平均水平。

7月中旬，在国有资产监督管理委员会（sac）下令电信服务提供商减少广告和营销支出后，张大中将中国移动（China Mobile）从中性股上调为买入，报77.36港元；该分析师认为，这一削减应有助于提高这家总部位于香港的公司的净利润。截至11月底，该股暴涨23.5%，至95.55港元。“我们对中国移动的股票拜访一直是我们客户阅读量最大的研究之一，”他说。

张艺谋的同事梁伟伟（Eddie）连续第三年领衔互联网行业，他表示，对移动数据的需求不断增长，使得投资中国互联网公司的机会大大增加。这位驻香港的分析师坚称，在线服务的发展势头——尤其是对电子商务的需求——将在相当长的一段时间内持续增长。他的首要推荐仍然是搜索引擎运营商百度，今年前11个月，百度股价上涨了38%。

从第三名跃居榜首的陈洛观察到，尽管网上零售业的迅速崛起损害了实体企业，也削减了对购物中心和商业地产的需求，但从长远来看，消费/非必需品公司仍存在机会，因为中国的中产阶级将继续增长部门名册。

“From a cyclical perspective, we believe the earnings will stabilize or even improve in the next 12 months,” he says. Oversupply in existing inventories will decline, and the anticorruption program, which cut into high-end spending on luxury products, will likely subside, believes the analyst, who is stationed in Singapore.

罗志军今年的最佳人选包括百丽国际控股（belleinternationalholdings），这是一家总部位于深圳的女装和女鞋制造商和零售商。他表示：“尽管零售环境疲弱，但我们认为，得益于强大的供应链，该公司运动服业务和弹性鞋类利润率的复苏，可能会为2014年带来潜在的盈利上升空间，其最近（财政）上半年的业绩再次印证了我们的观点。”。

In late October the company reported that net profit had surged 7.6 percent, to 2.08 billion yuan ($339 million), from March through August. By the end of November, the stock had advanced about 23 percent since bottoming out in March; year to date the shares are up 1.4 percent.

UBS’s Yanyan (Christine) Peng, who shoots straight in to first place in Consumer/Nondiscretionary in her first appearance on the team since 2010, also believes a turnaround is imminent. Her sector dropped about 20 percent in the year through November. “Hence we are turning more positive in the next 12 months compared with the beginning of the year,” she notes.

Even so, the Hong Kong–based analyst acknowledges there are challenges ahead, especially given the fact that the lead players already enjoy dominant market shares and will have a difficult time consistently outperforming in the future. She also believes that some companies are underinvested in their brands and products, which means that new product innovations might not be able to come through as easily and quickly as investors desire.

这些担忧和其他担忧有助于解释为何美银美林（BofA-Merrill）的崔国伟（davidcui）比其他许多分析师都不那么乐观。崔国伟连续第四年在投资组合策略方面位居榜首。“我对中国股市一到两年的前景持谨慎看法，”他表示。“我预计，随着经济增长放缓和坏账增加，中国金融体系将在某个阶段出现动荡。”

Investors should position their portfolios to withstand the coming volatility, adds Cui, who works out of Singapore. “I advise clients to be defensive, as China may potentially be going through an asset deflation cycle,” the strategist explains. Specifically, they should underweight financials, real estate developers and such investment-driven sectors as building materials, capital goods and contractors, he says, and overweight telecom, gas, utilities, defense, and some service sectors, such as logistics and tourism.