As a typical representative of the "new economy", is the Hang Seng Science and Technology Index, which has received much attention before, still "fragrant"?
Ran, ETF fund manager of Dacheng Hang Seng Technology, said: Hang Seng Technology Index is playing an increasingly important role in the Hong Kong stock market and has become another flagship index after Hang Seng Index and Hang Seng State-owned Enterprises Index. After several months of interval shocks, the Hang Seng Science and Technology Index has initially shown signs of bottoming out.
Ran believes that the main reasons why the Hang Seng Science and Technology Index is close to bottoming out are as follows:
First, the valuation of Hang Seng Technology Stock Index has been very low, but its growth rate has remained at a high level, and its peg rate is lower than that of GEM and NASDAQ 100. Judging from the current situation, the annual P/E ratio of Hang Seng Science and Technology Index 202/KLOC-0 is 33 times, 25 times in 2022 and 20 times in 2023, and the corresponding compound annualized profit growth rate exceeds 30%, and PEG valuation is low.
Second, the valuations of Tencent and Alibaba, the main heavyweights of the Hang Seng Technology Stock Index, have been at the lowest level in history, which means that the bad news has been reflected in the stock price, and there is not much room for future decline.
Third, judging from the market trend in recent days, even if there is bad news, the Hang Seng Science and Technology Index has not fallen further, suggesting that it has basically fallen to the right position.
The Hang Seng Technology Stock Index is known as the "Nasdaq" of the Hong Kong stock market. The constituents of the Hang Seng Science and Technology Index mainly cover the 30 largest Hong Kong listed science and technology enterprises that are highly related to the science and technology theme, which are basically Chinese-funded science and technology enterprises, covering the fields of network, financial technology, e-commerce and digital. Among them, Tencent, Alibaba, Meituan, Xiaomi, Aauto Quicker, JD.COM, Netease and other well-known companies are among them.
Science and technology index generally has the characteristics of high trend, high R&D investment and high valuation. Referring to Nasdaq 100 Science and Technology Index, SSE Science and Technology Innovation Board 50 Index and other comprehensive market indexes, we can find that the trend of science and technology index is generally better than the market, and R&D investment accounts for a higher proportion of income, higher valuation and higher allocation value.
The Hang Seng Science and Technology Index is no exception. In the past two years, the Hang Seng Technology Stock Index not only outperformed the major global indexes (including Nasdaq), but also surpassed the two flagship indexes of Hong Kong stocks-Hang Seng Index and hang seng china enterprises index.
Such an index of "choosing the best among the best" experienced a sharp correction after the Spring Festival of 202 1.
A large part of the reason is that the global economic recovery has led to the rise of cyclical industries and diverted funds in the field of science and technology; At the same time, some constituent stocks of Hang Seng Technology are also experiencing negative benefits such as canceling huge tax incentives.
Ran Linghao, ETF fund manager of Hang Seng Technology, believes that the performance of Hong Kong stocks in 2020 is obviously not as good as that of US stocks and A-shares, but the stagflation in the early stage of Hong Kong stocks provides sufficient space for future compensatory growth, and there will be multiple kinetic energy to push Hong Kong stocks up in the future. In the long run, the trend of the Hong Kong stock market is completely determined by the profitability of listed companies; In the next two years, the profits of listed companies in Hong Kong stocks are expected to rise rapidly, which will strongly support the trend of Hong Kong stocks.
He reiterated the view that the Hang Seng Science and Technology Index had basically bottomed out, but thought that the rebound might not come so quickly, because the market needed time to thoroughly digest the policy impact and negative news, and there might be a narrow range of fluctuations. However, in the fourth quarter, investors will gradually begin to reassess the valuation of the Hang Seng Technology Index based on the performance in 2022. At that time, they will find that the Hang Seng Technology Index still has good growth, and its valuation is cheaper, which may promote the index to rise better.