Guoxin Securities: Capital rebalance drives sector rebound, gold and jewellery ushered in expected double recovery

The Zhitong Finance App learned that Guoxin Securities released a research report stating that it maintains the sector's “superior to the market” rating. The complexity of the short-term peripheral macro environment has not changed the resilience of domestic demand. At the same time, leading companies that have a global layout vision, deeply embrace AI technology to achieve full-link upgrades, and accurately meet consumer needs with strong product capabilities are accelerating the realization of long-term allocation value. The actual sales of the popular jewelry brand Q2 are not bad. The stock price correction is disturbed by external gold price factors. Currently, most have returned to the lower historical valuation limit, and the dividend ratio is also relatively high. If gold prices stabilize in the future, stock prices can be expected to rebound. Cross-border e-commerce tariffs have a clear comparative advantage in reporting prosperity, while core companies' own operating adjustments have brought profit side increases to the enterprise.

Guoxin Securities's main views are as follows:

Consumption fundamentals were under pressure in the second quarter, but the overfall in stock prices was also quite obvious. Capital rebalancing ushered in a sharp decline and rebound

The country achieved a zero social growth rate of 1.3% in the first half of the year. Among them, the 1.0% growth rate in June rebounded from negative growth in May. Overall, the fundamentals of the consumer industry were relatively lackluster in the first half of the year, but there was no shortage of structural highlights in some fields such as high-end consumption and cross-border overseas travel. At the same time, the sector clearly fell over and over under the extremely fragmented market. Therefore, recent capital rebalancing is the core driver of the current rebound in the consumer sector. The bank believes that the first stage of the rebound is mainly to make up for excessive losses. The sustainability and height of individual stocks must be combined with the upcoming disclosure in the interim report, and pay attention to the compatibility of underlying fundamentals with dimensions such as valuation and dividends. At the same time, with the gradual strengthening of domestic demand policy expectations in the second half of the year, there are certain investment opportunities with strengthened thematic narratives.

Gold and jewellery ushered in investment opportunities under dual restoration

1) Recovery from the sharp decline in consumption: The overall market in the first half of the year showed a sharp correction in the second quarter, mainly affected by gold price disturbances. Although some pricing products were affected by demand from people with high price sensitivity, popular brands still showed outstanding performance through flexible promotions and demand release for weighted products. Leading brands such as Chow Tai Fu and Chao Hongji all maintained a relatively positive second-quarter same-store performance. 2) Expected recovery of gold prices: London gold recently returned to 4,400 US dollars/ounce. Currently, the general valuation level of leading companies has returned to the lower limit of the historical valuation center, which fully reflects pessimistic expectations under the turbulence of gold prices. Therefore, with the current rebound in gold prices, the lifting of repressive factors will also bring considerable room for a rebound. Moreover, the dividend ratio is generally high, which is also attractive to the dividend fund layout.

Risk warning: Consumption recovery falls short of expectations; industry competition intensifies; changes in corporate management, etc.