Since the beginning of 2022, the digital economy has continued to receive policy catalysis at the top-level design level, with continuous benefits. Affected by this, the relevant sectors of digital economy have been pushed to the forefront, and the secondary market performance in some segments is hot.
Is this round of digital economy sustainable? What are the medium and long-term prospects of the market? Which segments deserve special attention? How do investors choose the right fund for layout? The reporter of China Fund News interviewed Wang He, a researcher of China Southern Fund Equity Research Department and Boshi fund industry research department, Chen Xizhong, a fund manager of China Merchants steady optimization, Liu Rui, a fund manager of CITIC Prudential growth power, Zhang Lin, director of Xinhua fund research department, Shi Hongjun, general manager of Pengyang fund quantity investment department and director of index investment, Wang haobing, manager of ChuangJin Hexin digital economy fund Zhou Jiansheng, senior researcher of Nord foundation.
In the opinion of the above respondents, the digital economy has become a new outlet since the beginning of the year. In the current market environment, the explosive general rise may not last too long. However, it is expected to become one of the main lines of the market growth direction in the future.
explosive general rising market may be difficult to sustain
core industries are expected to continue to maintain
China Fund News reporter: digital economy has become the tuyere since the beginning of the year. How to treat this outbreak? Is it sustainable?
Equity Research Department of China Southern Fund: most of the subdivided tracks in the digital economy sector are continuous growth tracks. Although the business model is not explosive, it has shown strong stability in history. From the perspective of the penetration rate of each subdivided track, it is still low and the industry space is large. At the same time, the overall sector is highly related to liquidity, and the reduction of reserve requirements and interest rates is relatively beneficial to valuation expansion. After a long period of adjustment, institutional positions were at the bottom for many years, and valuations were generally at a low level. In particular, many small and medium-sized companies returned to the P / E ratio of 20 ~ 30 times, with a certain margin of safety. Therefore, we are relatively optimistic about the sustainability of the sector.
Shi Hongjun: since the digital economy was written into the government work report in 2017, it has been precipitating. It did not enter the public’s vision until this year with the introduction of various policies. Since the 18th National Congress of the Communist Party of China, the theme of digital economy has become a national strategy. It can be expected that the core industries of digital economy will continue to remain at the forefront in the future.
Chen Xizhong: since 2021, the intensive policy planning has conveyed a clear policy orientation and attracted market attention. At the same time, the market performance of the computer, communication and other sectors related to the digital economy has been relatively weak in the past two years, and the valuation is relatively low. Under the current market environment, the explosive general rise is difficult to last for too long, but some industries related to the digital economy, such as computer and communication, still have room for valuation repair.
Wang haobing: we believe that the senior management has shown great importance to the digital economy. At the same time, with the development of basic technologies such as mobile Internet, 5g, Internet of things, cloud computing and artificial intelligence, the foundation for the rapid development of digital economy has been gradually established. Therefore, digital economy is a direction worthy of continuous attention.
Liu Rui: against the background of Sino US scientific and technological confrontation, China’s digital economy opportunities outweigh risks in the next 5-10 years. Under the new technological change, China has blossomed in many places and ushered in historic opportunities: talent advantage (from engineer bonus to talent bonus) + capital advantage + demand advantage. From the perspective of lengthening the cycle, there is reason to believe that China’s digital economy will have long-term opportunities in the future.
Zhang Lin: we are very optimistic that from now to 2025, the digital economy is entering a period of comprehensive expansion. In the next four years, independent technology, infrastructure, industrial digitization and digital industrialization, data security and governance will usher in rapid development. Among them, cloud computing, as the most basic and important embodiment of the digital economy, will be directly or indirectly catalyzed and is expected to accelerate its development.
Zhou Jiansheng: the market of digital economy must be sustainable. It’s just that it rises more in a certain period and less in a certain period. In recent years, Internet, big data, cloud computing, artificial intelligence, blockchain and other technologies have been increasingly integrated into the whole process of various fields of economic and social development. Digital economy is becoming a key force in restructuring global factor resources, reshaping global economic structure and changing global competition pattern. In the important period of structural adjustment, it is believed that the market of the digital economy sector will continue to be realized with the sustainable development of the industry. There may be shocks during this period, but the general trend of history will not be changed.
the digital sector has comparative advantages
China Fund News: some people think that the digital economy will take over new energy and become one of the hottest sectors in 2022. What do you think?
Shi Hongjun: from the perspective of valuation, the current valuation of the digital economy index is about 59 times, which is similar to that of the gem index. However, the weighted PE of the constituent stocks of the digital economy index is 43% of the historical quantile, and the valuation of the gem index is 75% of the historical quantile. The digital economy index is not expensive relative to its historical valuation. In terms of fundamentals, the expected revenue growth and performance growth of digital economy in 2022 are 26.4% and 32% respectively, much higher than the overall market and TMT industry. From the perspective of fundamentals and valuation, the digital economy is currently in a relatively reasonable allocation range. In addition, it is in the tuyere of development, and its explosive power can be expected. Digital economy will become one of the hottest sectors in 2022. I think it is possible.
Chen Xizhong: at present, the secondary market has no clear and consistent expectations for the digital economy. Some people believe that the digital economy will take over and new energy will become one of the hottest sectors in 2022, while others believe that most concepts are difficult to implement. From the perspective of the general industrial trend and policy direction, the digital economy is expected to become one of the main lines of the future growth direction of the market together with new energy, but it is necessary to further select the layout of subdivided tracks in the TMT industry related to the digital economy.
Equity Research Department of China Southern Fund: the digital economy is affected by the post epidemic cycle in 2020, the financial and corporate budgets are suppressed in the actual implementation process, and the fundamentals of the sector itself are stable and slightly reduced. Since the third quarter of 2021, the downward pressure on the economy has begun to reflect, and the stability of the digital economy has begun to reflect its advantages. Therefore, we are relatively optimistic about the comparative advantage of the sector in 2022.
Wang haobing: the connotation of digital economy is very broad, including not only the direction of digital industrialization, but also the direction of industrial digitization. It is difficult for us to judge the short-term market performance, but we believe that the long-term prospect of digital economy is foreseeable.
Zhang Lin: cloud computing, the core representative of the digital economy, has become one of the core themes of the times. Judging from the upstream situation of the industrial chain (the shipment of chips and servers, etc.) and the capital expenditure direction of downstream cloud service providers, the prosperity of the cloud computing industry is gradually entering an upward channel.
Zhou Jiansheng: we think it is a kind of good wish and optimistic expectation. The gold content of the digital economy sector in China’s capital market is relatively weak. We can see that many companies are growing rapidly, but there is still a certain distance from those giants on the other side of the ocean. We should be realistic about this.
Liu Rui: digital economy may become a good investment theme in 2022. On the one hand, it is supported by industrial policies. On the other hand, it is also seen that many companies’ new products and technologies are promoting the innovation and development of the industry.
Wang He: market performance also needs to observe the specific landing measures and supporting rhythm after the introduction of top-level policies.
layout benefit segments
China Fund News: what are the sub sectors of the digital economy and what is the potential of each sub sector? What opportunities and risks exist at present?
Chen Xizhong: digital economy can be divided into two areas: Digital industrialization and industrial digitization.
Digital industrialization mainly involves emerging technology industries such as integrated circuit, Internet, big data, cloud computing, artificial intelligence and blockchain, with great development potential and space. At present, the risks mainly lie in the insufficient innovation ability in key areas or controlled by others, and the digital economy governance system needs to be further improved. Industrial digitization mainly covers the digital upgrading of traditional industries, including agriculture and water conservancy, industry and manufacturing, industrial Internet, e-commerce, smart logistics, finance and energy. On the whole, the space for industrial digitization is broad, and the risks are mainly that it is difficult for emerging technologies to finally land and the commercial application is slow.
Wang haobing: digital economy mainly has two directions: Digital industrialization and industrial digitization. Both are expected to make considerable development in the future. The current development stage of industrial digitization is relatively early, and the high-level support is greater, so there is more room for development.
Equity Research Department of China Southern Fund: digital economy is a concept covering a wide range. The major aspects can be divided into infrastructure and upper application software. At the infrastructure level, the industry growth rate varies from 10% to 25% according to the industry penetration. Its underlying logic is to develop with the continuous expansion of digital economy industry and data volume, which will directly benefit from the development of digital economy. Among them, relatively mature industries (IT equipment and communication) will also show a certain periodicity, and usually have better investment value at the bottom of the cycle. The upper application is more stable growth track, and the track with more prosperous downstream industry usually has stronger performance support.
Liu Rui: the pull of digital economy on GDP has become the consensus of China’s economic transformation. You can pay attention to the cloud computing + industry, that is, the investment opportunities of industrial Internet. In terms of segmentation, we can pay attention to the informatization of industrial software, cloud computing infrastructure, finance, medical treatment and other industries. We believe that there are two risks. One is the disturbance of macroeconomic growth, and the other is the disturbance caused by the Sino US scientific and technological confrontation.
Zhang Lin: the subdivided industries of digital economy include cloud computing, industrial digitization and intelligence, Internet sales, etc. Among them, industrial digitization and intellectualization are mainly manifested in two levels, namely, cloud and intellectualization. According to relevant plans, the estimated scale of the big data industry will exceed 3 trillion yuan by 2025, the average annual compound growth rate will remain at about 25% from 2020 to 2025, and a modern big data industry system with strong innovation, high added value and self-control will be basically formed.
Although the future business model of digital RMB is uncertain, the trend is very certain. At present, we need to pay attention to the rhythm of promotion and the expectation of capital market. Some subdivided industries also have development problems such as early growth and fierce competition.
Wang He: both technology, software and hardware benefit. There are two ideas for subdividing areas. First, in areas with large stock tracks, the absolute amount of value created after the efficiency improvement brought by digitization is also relatively large; Second, disruptive technology brings new market space and business model. The problem is the speed of realization and the competitive pattern.
Zhou Jiansheng: the upstream of digital economy is mainly various infrastructures, such as 5g industrial chain with 5g network as the core, basic components such as chips and PCBs. The investment opportunities in the corresponding secondary market in the upstream may not be so easy to explore. Midstream digital industrialization is the biggest opportunity we have seen in US stocks. The key technologies with artificial intelligence, cloud computing, big data and blockchain as the core enable all walks of life, which is an investment opportunity worthy of our attention; At the same time, digital industrialization will also bring some risks such as data security and government supervision. These risks related to digital governance need us to be vigilant. The digital application fields of downstream industries are very extensive. Investors may need to pay attention to the most obvious segmentation fields with marginal changes, such as digital currency, Internet of vehicles and other fields are in full swing. The risks that need to be paid attention to are mainly the actual application penetration of downstream industries, and beware of application scenarios that cannot be landed.
high volatility
suggest bargain hunting configuration or long-term fixed investment
China Fund News reporter: if you use funds to layout the digital economy sector, how should you choose? What should I pay attention to?
Chen Xizhong: you can pay attention to subdivided funds, including computer, communication and other industry theme funds or index funds, or choose fund managers with strong TMT background. It is recommended to pay attention to prevent short-term fluctuations in the configuration process and do not chase higher.
Wang haobing: and the digital economy covers a wide range of fields. Investors should also pay attention to whether the subdivision direction of recent key investment in fund products is consistent with their own needs.
Liu Rui: you can find fund managers with rich investment experience and excellent long-term performance in the past. However, it also reminds investors to choose appropriate products according to their risk tolerance, investment objectives and investment period.
Equity Research Department of China Southern Fund: it is suggested to refer to the two layout ideas recommended by us in the layout of the track to diversify investment and avoid excessive concentration of risks. At the same time, considering that the digital economy is a long-term industrial trend and the fundamentals of relevant industries are steadily upward, it is suggested that investors should not pursue short-term hot spots in the fund layout, and the layout can often obtain more ideal returns at the time points with low market attention.
Zhou Jiansheng: when investing, we need to avoid the possible behavior of rubbing hot spots. Digital economy is the general trend of the times, not a short-term conceptual hot spot. For those who only rub hot spots and do not adhere to the digital economy industry for a long time, they are unlikely to enjoy the dividends brought by the development of digital economy industry in the future.
