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<Research>Galaxy Securities Recommends POP MART for Trendy Toy Sector, Expects CN to Continue Launching National Subsidies Next Yr for Consumption Boost
Recommend 13 Positive 44 Negative 15 |
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Yesterday, six Chinese ministries Jointly issued an implementation plan on enhancing the supply-demand alignment of consumer goods and further promoting consumption, according to a report from China Galaxy Securities. As boosting consumption is a large-scale systematic project, policies will continue to exert force. China's consumer market is under pressure from insufficient purchasing power for various factors, and national subsidies are the fastest way to stimulate short-term demand. Since July 2024, consumption policies have been significantly strengthened. In July, the National Development and Reform Commission and the Ministry of Finance coordinated RMB150 billion in ultra-long-term special government bond funds dedicated to supporting the trade-in of old consumer goods for new ones. In 2025, the government is continuing to allocate RMB300 billion to support such trade-ins, and national subsidies have provided some improvement from 2H24 through 2025, though there is now pressure from the gradual phase-out of these subsidies. In October 2025, total retail sales of consumer goods rose by 2.9% YoY, with the growth rate down 0.1 ppt MoM. China Galaxy Securities expects that it is highly likely that national subsidy stimulus will continue into 2026. China Galaxy Securities recommends GUMING (01364.HK), DAMAI ENT (01060.HK), and MIXUE GROUP (02097.HK) for the new consumer track of the social service sector, as well as GUOQUAN (02517.HK) and NONGFU SPRING (09633.HK) for the food and beverage sector. In the apparel sector, the broker is eyeing ANTA SPORTS (02020.HK) and XTEP INT'L (01368.HK). Regarding technology consumption, it prefers TCL ELECTRONICS (01070.HK) and HISENSE HA (00921.HK). As for home appliances with high dividend rates, it likes MIDEA GROUP (00300.HK) and HAIER SMARTHOME (06690.HK). For trendy toys, it recommends POP MART (09992.HK). AAStocks Financial News |
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