The Zhitong Finance App learned that Guojin Securities released a research report saying that on August 3, Chairman Wu Qing of the Securities Regulatory Commission launched the RMB treasury bond futures listing ceremony in Hong Kong and delivered a speech, proposing five measures to deepen two-way practical cooperation in the capital markets of the two places. Continued release of the policy dividends of connectivity at the regulatory level will increase capital market activity between the two regions, enrich product supply, and enhance the global allocation value of Chinese assets. The Hong Kong Stock Exchange (00388) and high-quality brokerage firms providing cross-border financing and investment-side services are expected to benefit in the long term. The current valuation of PB and PE in the securities sector is 1.2x/16x. A number of brokerage firms have issued advance announcements to maintain the “buy” rating of the securities industry, which is undervalued and has a high performance growth rate.
Guojin Securities's main views are as follows:
Continue to support two-way financing and continue to optimize the Hong Kong stock structure
Since 2024, more than 270 mainland enterprises have completed the filing for listing in Hong Kong, raising more than HK$650 billion. Mainland enterprises account for 80% and 90% of the market value and transaction amount of listed companies in Hong Kong, respectively. Among them, a number of leading companies in the fields of new energy, new consumption, biomedicine, and artificial intelligence went public in Hong Kong, and the Hong Kong stock market industry structure continued to be optimized. In the next step, the Securities Regulatory Commission will continue to support the listing of domestic companies in Hong Kong and the listing of high-quality Hong Kong stock companies in China, as well as supporting eligible Hong Kong companies to issue bonds in the mainland. Cross-border corporate financing is open in both directions, and the high-quality supply of Hong Kong stocks continues to expand.
Further expansion of interconnection products
Currently, the amount of Chinese bonds held by international investors has reached 3.2 trillion yuan. 5-year RMB treasury bond futures were introduced in Hong Kong, providing a convenient and efficient interest rate risk management tool for foreign investors. The two-way stock market value coverage of the Shanghai-Shenzhen-Hong Kong Stock Connect has exceeded 90%, and matters such as the RMB stock trading counter and the inclusion of REITs in the Shanghai, Shenzhen, and Hong Kong Stock Connect are progressing rapidly. The Securities Regulatory Commission will also support index companies from the two regions to strengthen cooperation, launch more indices based on Chinese assets, push industry institutions from the two places to launch more ETF products based on the two local markets and layout China's modern industrial system, and support Hong Kong to launch more types of futures settled in RMB. The product structure is more diverse, and the continued deepening of connectivity is expected to increase the activity of capital markets between the two places.
The “Five Major Collaborations” framework has been established, and the cooperation path is clear
In addition to functional collaboration in two-way financing and collaboration to launch diversified products, the Securities Regulatory Commission will also focus on ecological collaboration, regulatory collaboration, and governance collaboration to support high-quality securities fund companies to develop businesses in Hong Kong and strengthen regulatory collaboration between the two places. The “Five Major Collaborations” have formed a blueprint for systematic cooperation to promote high-quality development of the capital markets of the two places through systematic cooperation.
Risk Alerts
The macroeconomy has stalled; equity market activity has declined sharply; the progress and effects of policy implementation have fallen short of expectations.