What do you mean? 50 billion big bull went bankrupt, and it is planned to raise 65 billion big god Sadan...... In April, what do you think about A-shares?

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Value line guide

This weekend, two big news came out. Shenzhen Royole Technology, which was once valued at 50 billion myths, filed for bankruptcy, and the reason for the bursting of the bubble turned out to be that it could not IPO, but could only go bankrupt. Syngenta, which plans to raise 65 billion yuan, passed the meeting 28 days after it was accepted, but terminated its IPO nearly a year after the meeting......

In recent years, the A-share listing has made intermediaries and various capitals eat a lot of money, and after the listing, the major shareholders have squeezed out the equity value by pledging or reducing their holdings, leaving many bad companies in the market. In the end, all parties are winners, except for secondary market investors.

These two pieces of news show at least three points: First, A-shares are still very weak; second, in the capital market, especially in the primary market, it is difficult to cheat a lot of money; and third, the regulators really can't stand it and have begun to intervene directly.

In April, spring is already blooming in the natural world. After the deep V in the first quarter, what will be the performance of A-shares? Will it stop and return to the cold or arch upwards to welcome the warmth? What will be the hot spots?

The 50 billion bubble bursts,

Royole filed for bankruptcy

It's really no joke to go bankrupt if you don't go public. This home consists of:

CITIC Capital holds about 6% of the shares, and the unicorn Royole Technology, which is valued at 50 billion, is about to go bankrupt.

Recently, according to the National Enterprise Bankruptcy and Reorganization Case Information Network, Shenzhen Royole Technology Co., Ltd. and its subsidiaries Shenzhen Royole Electronic Technology Co., Ltd. and Shenzhen Royole Display Technology Co., Ltd. each added a new bankruptcy review case, and the applicants were natural persons Zhang Ming, Wang Jinzhou, and Guo Xiaotao.

From the perspective of equity, Liu Zihong directly holds it

Royole Technology has a 38.61% stake, and the second largest shareholder, CITIC Capital, holds about 6% of the shares. As soon as the news came out, Liu Zihong was contacted by the media, and the founder responded that everything is subject to official news.

Founded in May 2012, Royole has quickly completed a total of 13 rounds of financing from Series A to Series F in the eight years from its establishment in 2012 to 2020.

From 2017 to the first half of 2020, Royole's operating income was 65 million yuan, 109 million yuan, 227 million yuan and 116 million yuan respectively. During the same period, the company's net profit attributable to the parent company was -359 million yuan, -802 million yuan, -1.073 billion yuan and -961 million yuan respectively.

At the end of 2020, Royole Technology submitted an IPO application for the Science and Technology Innovation Board, planning to raise 14.443 billion yuan, with an overall valuation of about 50 billion yuan. It is worth mentioning that the sponsor was CITIC Securities at that time, and it was also the second largest shareholder of the company. Of the 14.4 billion yuan to be raised, half of it is used to supplement liquidity, and it is clear that Royole Technology is indeed short of money.

With the disclosure of the prospectus, Royole's financial predicament was suddenly exposed to the public, and since then, the situation of Royole Technology has begun to take a sharp turn for the worse.

The successive "equity freezing", "consumption restrictions", "enforcement", "wage arrears" turmoil, and now the "bankruptcy review", Royole Technology has been entangled by various negative labels in recent years. Up to now, Royole Technology has 23 pieces of information on persons subject to execution, with a total amount of more than 3 billion yuan.

The 50 billion unicorn has now fallen to this point, and it has to make people sigh: the company is not doing well, PE/VC wanted to make money, and in the end the principal was gone, and the sponsor who accompanied you was also deep in the mud. In short, the stock market is not a blood transfusion station, not a nursing home, and not an ATM for some powerful people. The good thing is that the shareholders have escaped, and they are grateful for the grace of not killing.

What else happened this weekend?

1. Syngenta terminated its IPO

This, of course, is positive for the sentiment of the secondary market. Everyone is familiar with a giant like Syngenta,

The meeting will be held 28 days after acceptance. The reason why it is good news is that on the one hand, its IPO amount is huge, reaching 65 billion yuan, and on the other hand, one of the purposes of its listing and financing is to repay long-term debts. Stopping in time will undoubtedly increase confidence in the secondary market.

Shareholder: Don't say anything, Angkor will give you one.

2. Microsoft and OpenAI plan to invest $100 billion to build AI supercomputing

On March 29, the media quoted sources as saying that Microsoft and OpenAI are closely planning an ambitious data center project to build an AI supercomputer called Stargate. The computer will be equipped with millions of dedicated server chips designed to power OpenAI's AI technology.

It is reported that the project is expected to cost up to $100 billion, which is 100 times the cost of some of the largest data centers currently available. Microsoft will fund the project, demonstrating its strong belief in advancing AI technology. Stargate will be one of the largest projects the company plans to build in the next six years.

Analyst comments: It is basically good for the direction of computing power, especially for CPO.

3. The United States revised the export control order on semiconductors to China, which is intended to take effect on April 4

The Bureau of Industry and Security (BIS) under the Ministry of Commerce of the People's Republic of China issued regulations on the implementation of additional export controls on March 29 local time, which are intended to take effect on April 4. The 166-page rule, which targets the export of semiconductor projects, is intended to make it more difficult for China to acquire U.S. AI chips and chip-making tools, such as the new rules, which also apply restrictions on the export of chips to China to laptops containing those chips.

In April and March, China's manufacturing purchasing managers' index was 50.8%, up 1.7 percentage points from the previous month

Not easy, after a lapse of five months, the manufacturing PMI in March was 50.8, finally standing above the boom and bust line, and the non-manufacturing PMI was 53, and the composite PMI was 52.7, which also rose significantly.

In terms of enterprise scale, the PMI of large, medium and small enterprises was 51.1%, 50.6% and 50.3% respectively, up 0.7, 1.5 and 3.9 percentage points from the previous month, all higher than the critical point.

The manufacturing PMI turned positive, and the activity of small and medium-sized enterprises improved the most, combined with the data from January to February, at least from the release of data, the growth in the first quarter should be stronger than the market expectations at the end of last year.

How will A-shares perform in April?

In the first quarter of 2024, the market can be said to have walked out of a deep V, from the beginning of January to the Spring Festival, it is constantly going to collapse, and after the Spring Festival, it will come out of a strong bottoming repair.

In this wave of rebound since the low, high dividends stabilized the basic market of the entire index, and the AI chain (computing power, corpus and application) and low-altitude economy became the strongest trading main line in terms of the theme track.

Entering the April earnings season (intensive disclosure period), the branch with more "solid" fundamentals and strong performance certainty is more likely to outperform the market, and this logic has basically formed a consensus among investors.

Value now collates the latest strategic views of the three major brokerages for investors' reference:

Soochow Securities: Performance disclosure window, looking for the direction of economic improvement

From the historical experience of the past 10 years, for the April earnings season, the winning rate trading based on performance certainty/medium-term fundamentals tends to prevail, while the odds trading based on industrial development logic/forward fundamentals has a greater risk of "underperformance", which may mean that the market risk appetite will change to a certain extent when entering the performance-intensive disclosure period.

As April approaches, it is recommended to screen investment opportunities from three perspectives: 1) Segments with high prosperity or certainty upward, "excellent" companies: "overseas enterprises" (power grid equipment/light textile manufacturing/cross-border e-commerce/light industry home appliances/general machinery/forklifts/shipbuilding), upstream resource products and related industries (gold/copper/oil/gold jewelry), science and technology cyclical products (storage/OLED), and some subdivisions of consumption recovery (leisure snacks/express delivery/aviation/hotels), Policy constraints on the supply direction (refrigerant);2) Some fundamentals are bottoming out or further downside is limited, and the branches of stock prices "overfalling" may revise as expected: glass and modules in the photovoltaic industry chain, lithium battery electrolyte, and pig breeding, etc.; 3) "new demand" driven by "new technologies", and "new growth" whose capital pricing is verified by performance: such as optical modules, PCBs, intelligent driving systems and components.

Shenwan Hongyuan strategy believes that the April will not fall sharply has been regarded as an investment logic, but the spring restless market will eventually be constrained by cost performance, and there is not much room for the current position market interpretation.

1. On the side of technological growth, the fundamental support will be insufficient in 2024, and the environment at the denominator end will be favorable (the risk-free interest rate will fall, and trading funds will prevail). Thematic quotes may have repeated opportunities, but avoid the performance verification period. The industry trend market has deduced to the stage where performance needs to be realized, and the upward resistance may increase significantly. Make a purer investment in improving the denominator. Focus on new topics in the concept and introduction periods, the second wave of low-altitude economy, brain-computer interfaces, humanoid robots, etc. However, the thematic investment, which is mainly based on the improvement of the denominator, is objectively different from the classical value investment orientation.

2. On the side of high dividends, continue to emphasize that high dividends are becoming a trend of thought, which may be the "steady happiness" throughout the year in 2024. The "two strong and two strict" management promotes the construction of the legal system of the capital market, which resonates with the market preference (large-scale bottom warehouse assets) and the trend of corporate governance optimization (high-quality governance, high-quality returns, and high-quality mergers and acquisitions), which may be the clue to the next wave of trending markets.

In March and April, the increase in the dividend ratio may be concentrated on verification, strengthen the trend of high dividends, enhance the aggressiveness of high dividends, and continue to recommend electricity, operators, railways and highways, clothing and home textiles in the steady-state overestimated dividends, and home appliances, coal, nonferrous metals, and oil in the dynamic high dividends. In the imperfect high dividend, pay attention to the bank and insurance stocks that can increase the dividend ratio. There are still a lot of undervalued high-dividend assets in consumer goods.

CITIC Securities: The signal on the right side needs to be tested, and the dividend strategy is more dominant

CITIC Securities believes that in April, the right signal will enter the test period, it is expected that the economy will run smoothly in the first quarter, and the capital market reform will gradually land, but the macro boom to the corporate profit side still needs to be verified by the financial report, and the overall stability of macro liquidity, it is expected that A-shares will still maintain the overall upward movement of the valuation center, active capital pricing, and the characteristics of the dominant barbell structure;

In terms of the selection of specific varieties, it is recommended to focus on the characteristics of stable cash returns, avoid being too affected by business fluctuations, and on this basis, pay attention to the improvement of the dividend rate of central state-owned enterprises and the improvement of governance: it is recommended to continue to pay attention to hydropower with stable free cash returns, globally priced resources (copper, oil), property insurance with stable premium growth, banks with dividend yield expectations that are still considerable and benefit from the risk mitigation of debt, and home appliances that benefit from the trade-in policy. For the other end of the barbell structure, the theme of new quality productivity catalyzed by policies is still worthy of active participation, and it is recommended to focus on topics such as domestic computing power, autonomous driving, and low-altitude economy.

annex

1

Important A-share trading data this month

Table 1: Top 10 gainers of A-shares in March

Table 2: Top 10 A-share decliners in March

Table 3: The top 5 companies with more than 50 billion yuan rose in March

Table 4: Top 5 companies with 100-50 billion yuan in March

Table 5: The top 5 companies with less than 10 billion yuan rose in March