“When I habitually face the star sea of innovation and growth, how do you let me adapt to this kind of deep value investment?” Lou Qiang (a pseudonym), a fund manager in Shanghai, told the China Securities Journal. The reason why I went to interview Lou Qiang, a fund manager with the label of growth investment, is that he belongs to the far end of the ruler in feeling and operating the scale of real estate stock investment.
In investment, the most important thing is expectation, and the most unpredictable is expectation. Real estate stocks have stood at the expected crossroads: on the one hand, there are signs of loosening of macro policies, on the other hand, the long-term low allocation of institutions and the current low valuation. It seems that real estate stocks will usher in a “double-click”. However, expectations are only expectations after all. There is no clear reversal signal in real estate commencement data and sales data.
In terms of specific investment, the differences between fund institutions are not small. Some people want to avoid the decline and do not have long-term confidence; Some people shouted that the investment in real estate stocks has entered a new stage; Others feel that the optimistic expectation of real estate stocks is only wishful thinking of the market and does not need to participate. There are different opinions. At present, public funds are still “casting stones and asking for directions” in the investment of real estate stocks.
return or youth
In the spring of 2022, the real estate industry is ushering in the melting of ice and snow. In fact, this process has already begun. Since September 2021, the policy tone has gradually warmed up, and the easing policies at the credit end and local governments have increased significantly. At the policy level, it is clearly proposed to maintain the stable and orderly release of real estate credit, support the commercial housing market to better meet the reasonable housing needs of buyers, stabilize land prices, house prices and expectations, and promote the virtuous cycle and healthy development of the real estate industry due to urban policies.
Under the warm wind of such policies, real estate stocks have become a rare scenic spot in the shock city. According to wind data, as of April 17, the Shanghai real estate index has risen 29.21% since September 1 last year.
The policy warm wind continues to blow. In order to support the development of the real economy and promote the steady decline of comprehensive financing costs, the people’s Bank of China decided to reduce the deposit reserve ratio of financial institutions by 0.25 percentage points on April 25, 2022 (excluding financial institutions that have implemented the deposit reserve ratio of 5%) Haitong Securities Company Limited(600837) said that since 2008, there have been 22 RRR reductions in six rounds of RRR reduction cycles (excluding this RRR reduction). About three months after the occurrence of each drop point, the A-share real estate index has a 59% probability of obtaining absolute and relative returns. In addition to the good performance of the first and the fourth round of standard reduction in the real estate industry, the first round of standard reduction and the fourth round of standard reduction are often superimposed after the third round of standard reduction in the real estate industry.
However, after years of downturn, whether real estate stocks can return is still a teenager? At present, the answer is not so. Data show that heavyweights are the leaders in the current round of recovery of real estate stocks. Taking Poly Developments And Holdings Group Co.Ltd(600048) as an example, they have increased by 69.62% since September last year. The performance of private enterprise real estate stocks is relatively poor, “The current round of real estate market is slightly different from that in history. Under the background of ‘three red lines’ and’ no speculation in real estate living ‘in the past two years, the real estate industry has entered a downward cycle, there is significant differentiation within the real estate industry, and the real estate credit risk of private enterprises is frequent. Therefore, whether the valuation repair range or the rise and fall range, the real estate stocks of private enterprises are far inferior to the real estate stocks of state-owned enterprises. If the follow-up policy takes effect, the risk of the whole real estate industry can be reduced To effectively resolve, private enterprise real estate stocks may usher in better repair opportunities. ” China Industrial Securities Co.Ltd(601377) indicates.
fund institutions busy covering positions
The allocation of market funds to real estate stocks is much lower than before. According to Tianxiang data, by the end of 2021, the largest heavy position stock of public funds in the real estate industry was Poly Developments And Holdings Group Co.Ltd(600048) , ranking 27th, with a total of 3142 funds holding Poly Developments And Holdings Group Co.Ltd(600048) , with a total market value of about 31.871 billion yuan. Looking back on the past, “Zhaobao Wanjin” once occupied the “first group” of public fund positions.
At present, real estate stocks are full of warmth and obvious profit-making effect, which naturally attracts the pursuit of institutional funds.
Li Yongxing, deputy general manager and equity investment director of YONGYING fund, pointed out that real estate stocks have increased significantly recently, especially some real estate stocks with low price to book ratio superimposed theme investment have risen sharply under the expectation of policy relaxation. “This is also in our expectation. Only from the historical experience, the rising time rhythm of real estate stocks with low price to book ratio superimposed with subject investment is earlier than that of each round in the past. In the past, the rise of such real estate stocks usually occurred in the early stage of real estate sales improvement, but this time the market of subject investment appeared before the improvement of sales. On the one hand, it is because the valuation of the starting point of this round of rise of real estate stocks is lower than that of each round in the past; on the other hand, there are With past historical experience as a reference, investment in the market may also advance. ” Li Yongxing said that the tight rhythm of market funds chasing opportunities can be seen.
In fact, even Lou Qiang, who has a firm attitude, has a flexible way. “If I have knowledge reserves and the product contract allows, I believe I will also actively participate in real estate stocks. Under the current situation, I will look for growth opportunities in the real estate industry chain.” Lou Qiang said.
In fact, there are many people with such flexibility. Liu Bin, fund manager of guolian’an fund, said that although it is impossible to assert how long the current scale of the real estate industry can be maintained, for a large number of real estate companies, the current scale of the industry still has enough room for development. Liu Bin believes that the current market share of leading enterprises in the real estate industry is about 5%, and there is still room for improvement in the future. Since last year, some companies have had problems and are difficult to return to the market. Therefore, the supply is reduced, and the relationship between supply and demand in the industry has improved.
In addition to the research and judgment of the industry, Liu Bin said that some targets of the real estate industry have been included in their own investment framework. “In fact, we don’t pay special attention to industry allocation, but more to the value of specific assets and whether their current price can meet our requirements for potential return. We pay more attention to the specific target value. First, the profitability of the enterprise, which determines its long-term value; second, the price we pay, which is the valuation. The two always need to have a good cooperation, which is the investment with a safety margin, which is the basis of our investment This framework and principles. ” Liu Bin said.
In fact, many fund institutions have taken real estate and its industrial chain as an important investment main line.
Guohai Franklin fund believes that the main line of market investment tends to be arranged along the two threads of steady growth – real estate infrastructure and energy infrastructure. We are optimistic about the short-term game opportunities of the real estate industry, the photovoltaic manufacturing and power operation industries in the medium and long term, and the energy and grain industries in the long term. Also in the field of steady growth, Huatai Bairui Fund believes that the epidemic since March has once again impacted real estate sales, so the policy overweight window continues, and it is optimistic about the real estate and property sectors in the medium term.
“From the past rounds of RRR reduction, the RRR reduction is not necessarily related to the performance of the A-share market. The industry suggests paying attention to the steady growth chain represented by big finance and building materials and the inflation chain represented by coal, chemical industry and agriculture.
”Wu Qiran, a macro strategy researcher at xingyin fund, said.
market differences
The recent strong performance of real estate stocks has highlighted the performance of some fund products. For example, the performance of Jingshun Great Wall China in the past one month, three months and six months is among the top 1% of the same type of fund products. According to the Fund announcement, this fund product will make the position of real estate stocks to the “top” at the end of 2021. Among the top ten heavy position stocks, Gemdale Corporation(600383) accounts for 9.78% of the net asset value of the fund, China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) accounts for 9.64%, Poly Developments And Holdings Group Co.Ltd(600048) accounts for 9.61%, and China Vanke Co.Ltd(000002) accounts for 8.72%. The fifth to tenth heavy position stocks are also real estate stocks and building materials stocks related to the real estate industry chain.
“The real estate industry has our favorite supply side logic. After the end of the internal roll of the industry, the rest is the king. In the past, 20 people robbed 17 bowls of rice and beat their heads and blood. Now only 15 people are left to eat 17 bowls of rice. Even if these 17 bowls of rice will be reduced to 15 or 12 bowls in the next ten years, it doesn’t matter. Those who survive can live much more comfortably for a long time in the future than in the past few years.” Han Wenqiang, a fund manager of Jingshun Great Wall China with flexible return allocation mix, said.
Of course, there are still a few absolute positions like the above fund products. Many fund managers focus on risk avoidance and trading in the investment of real estate stocks. “Since 2022, we have invested in real estate stocks with 10% – 20% stock positions. The main consideration is to avoid the correction of growth stocks, and with the increasing market attention of real estate stocks, the trading opportunities are becoming more and more obvious.” Said the fund manager of a bank fund company. Another fund manager is more straightforward in the game and trading. He said: “with the loosening of policies, the improvement of the fundamentals of real estate stocks is still far in the future, so now is the expected speculation. Since this time, there have been many changes in real estate policies in various places. Researchers and I have closely followed this kind of information, and the positions of real estate stocks are also in and out, hoping to win profits.”
Other fund managers believe that real estate stock investment is the wishful thinking of market funds and should be carefully involved. “The investment logic of many peers in real estate stocks is that real estate will be an important driving point in the main line of steady growth. Even if it is determined according to the valuation system of the public utility industry, real estate stocks should also have room for valuation improvement. I don’t deny that there is an opportunity for valuation repair, but if you hype the expectation of steady growth, you will put your investment on unpredictable policy factors. The risk is too high, so I choose not to participate.” An unnamed fund manager believes that market funds are sliding towards irrationality.
In addition to the discussion on whether real estate stocks are worthy of layout, fund managers are also concerned about the impact of the recovery of the real estate industry on the whole investment market.
Li Yongxing said that on the one hand, the current round of real estate stock market may not be over, the valuation has not been repaired to a reasonable level, and the industry fundamentals may still be in the early stage of the rising cycle; On the other hand, we need to think about the possible impact of the fundamental repair of the real estate industry on market investment opportunities.
\u3000\u3000 “One possible impact is the impact on the capital flow. If the subsequent capital flow direction is the real estate market rather than the stock market, it will have a new impact on the valuation and pricing method of the stock market. Historically, every change in capital flow will lead to a change in the investment method of the stock market. If the capital no longer flows into the stock market as in the past three years, it will be in the A-share market in the past three years The prevailing track investment approach may also no longer dominate. We need to continue to observe this. ” Li Yongxing proposed.
