Recently, the fluctuation and adjustment in the A-share market continue, but from the perspective of previous views, a group of international investment banks are not pessimistic about the future market and have successively raised their ratings on A-shares. At the same time, as the third-quarter reports of listed companies enter a concentrated disclosure period, the latest holdings of international investment banks have also gradually emerged, among which many high-performing stocks have received joint increases from international investment banks.

International investment banks have successively raised their ratings.

This week, the A-share market is still continuing the fluctuating trend after the National Day holiday, but with the introduction of a series of policy "combination punches," the attitude of international investment banks towards A-shares is changing.

According to reports, on September 30, Wang Zonghao, head of China equity strategy research at UBS, said, "Raise the target price of the MSCI China Index and tactically adjust from H-shares to A-shares."

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On October 5, Goldman Sachs announced that it would upgrade the Chinese stock market to "overweight" and raise the target prices of the MSCI China and CSI 300 indices. In terms of industry allocation, insurance and brokers, exchanges, and other financials were upgraded to "overweight," and the "overweight" rating for the internet and entertainment, technology hardware, and semiconductors was maintained. On October 7, Goldman Sachs adjusted the Hong Kong stock market to "overweight" in its latest research report, shifted its strategic preference from Hong Kong stocks to A-shares, and upgraded the insurance theme to "overweight." For the future market performance, Goldman Sachs expects that the Chinese stock market still has the potential to rise further, with an expected increase of 15% to 20%.

On October 6, Morgan Stanley stated that the current upward trend has brought the forward price-earnings ratio of the MSCI China Index to 11.3 times. With policy support, the valuation will expand to 12 times. The MSCI China Index is currently trading at a 12% discount, lower than the MSCI Emerging Markets. If history repeats itself and the relative valuation gap converges with emerging markets, there is a 12% room for valuation repair.

On October 17, BlackRock, the world's largest asset management company, said it is focusing on investment opportunities in the stock markets of Japan, China, and the UK, as these markets currently have relatively attractive valuations. It will "moderately increase" its holdings in the Chinese stock market, believing that there are signs of China about to introduce significant fiscal stimulus policies, but it still pays attention to China's long-term structural challenges.

Goldman Sachs, Morgan Stanley, and other newly heavy positions in many stocks.

While international investment banks such as Goldman Sachs have successively raised their investment ratings for the Chinese stock market, they have also been continuously buying A-shares.

According to Wind statistics, as of the end of the third quarter this year, a group of international investment banks including Goldman Sachs, Morgan Stanley (Big Mo), and JPMorgan Chase (Little Mo) have appeared in the list of the top ten circulating shareholders of listed companies, mainly focusing on increasing positions and newly entering heavy positions. One company in particular has received the collective favor of Big Mo, Goldman Sachs, and UBS, three international investment banks. During the third quarter, Big Mo increased its holdings by 2.8187 million shares, while Goldman Sachs and UBS were newly entering heavy positions.According to the announcement, the company is a specialty fine chemical enterprise, mainly engaged in environmental protection new materials and specialty fine chemicals. In the first three quarters of this year, the company achieved a net profit attributable to the mother company of 825 million yuan, a year-on-year increase of 2,949.37%. This increase ranks first among all companies that have disclosed their third-quarter reports, and the company is also hailed by the market as the "King of Performance Increase".

The electronic stock, JiuJiu Optoelectronics, has also won the favor of many international investment banks. At the end of the third quarter, Barclays Bank and Morgan Stanley both became the top ten circulating shareholders of the company in a new way. JiuJiu Optoelectronics' performance in the first three quarters of this year is also eye-catching, achieving a net profit attributable to the mother company of 56 million yuan, a year-on-year increase of 1,448.11%. This increase currently ranks second among all companies that have disclosed their third-quarter reports.

In addition, Shangwei Shares, Zhongdian Environmental Protection, and Hisen Pharmaceutical have also received new heavy positions from international investment banks. Their performance in the first three quarters of this year is also commendable, all achieving profits, and Hisen Pharmaceutical has achieved performance growth.

"Smart Money" Newly Heavy Positions in 7 Stocks

Goldman Sachs, Morgan Stanley, and others are all QFII (Qualified Foreign Institutional Investors). In addition, they are also entering the A-share market through the Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect, which is also known as "Northbound Capital" or "Smart Money". It is reported that they are very sensitive to the prospects of the industry, and the stocks they flow into are generally low-risk, easy-to-increase stocks, which are a benchmark for investment.

According to statistics, during the third quarter of this year, Northbound Capital has currently appeared in the top ten circulating shareholders of 33 listed companies, also mainly focusing on increasing positions and newly heavy positions. Among them, 7 stocks were newly heavily positioned, including Jianyuan Trust, Chuangshiji, and Huadian Energy, etc.

The companies that Northbound Capital has increased positions and newly heavily positioned are also mostly high-quality stocks. For example, Huadian Energy, the company achieved a net profit attributable to the mother company of 453 million yuan in the first three quarters, a year-on-year increase of 800.92%, which is currently the "King of Increase" among all Northbound Capital's heavy positions. Data shows that Huadian Energy's main business is power generation, heating, and electricity meter sales. The company stated that the main reason for the significant increase in performance is due to the decline in coal prices during this reporting period.

The performance increase of Jiangsu Sopo, a coal chemical company, ranks second among all Northbound Capital's heavy positions, reaching 239.71%, which is also related to the decline in coal prices. The company stated in its third-quarter performance forecast, "In the first three quarters of 2024, the company's main product production and sales volume increased year-on-year, and the unit cost decreased year-on-year, which is expected to achieve a profit in the first three quarters of 2024 compared to the same period last year."

From this perspective, other listed companies that also use coal as the main cost will also benefit from the decline in coal prices, and their third-quarter reports are also worth looking forward to.