BOCI Research released a research report stating that on September 25, the National Development and Reform Commission held a meeting, emphasizing the overall arrangement of 300 billion yuan in ultra-long-term national bonds to support the consumer goods trade-in program. The policy of trading in old appliances for new ones is fully implemented in all 31 provinces and regions, and was implemented locally in early August.
The report believes that this will further boost consumer confidence. The bank points out that JD.com-SW (09618) and Alibaba-W (09988) are the top choices in the Chinese internet industry, and expects them to be the main beneficiaries of the appliance trade-in policy and the increased liquidity from the Shanghai-Hong Kong Stock Connect.
The bank stated that Chinese telecommunications stocks are still attractive. China Telecom (00728) and China Mobile (00941) had dividend yields of 5.7% and 6.5% respectively based on the Hong Kong closing prices on October 7th. On the other hand, ZTE (00763), although performing better than the broader market in the short term and trading at a P/E ratio of 11.2 times for the fiscal year 2025 which is relatively attractive, has a high beta ratio.