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As A-share stocks rise, future valuation looks promising, experts say   2025-12-04

 

 

Buoyed by the price rally of A-share electrical machinery, robot actuator, and commercial aviation companies, all three major benchmark indexes reported gains during the morning trading session on Thursday, with the technology-focused ChiNext in Shenzhen rebounding strongly by 0.76 percent.

Shanghai Composite Index rose by 0.04 percent, while Shenzhen Component was up by 0.35 percent. Market activity remained strong, with the combined trading value at the Shanghai and Shenzhen exchanges topping 1.03 trillion yuan ($150 billion) during the morning hours.

Experts from Everbright Securities explained that strategic emerging industrial clusters, such as commercial aviation, will speed up their development during the 15th Five-Year Plan (2026-30) period as the country rolls out more detailed plans. Companies along the industrial chain will benefit from the high-quality development of the commercial aviation sector, they said.

While world leading technology companies such as Tesla have set clearer goals to develop humanoid robots, Chinese companies will play an increasingly important role in the global robot boom, thanks to their manufacturing strength and their competitiveness in cost control, experts from CITIC Securities said.

Meng Lei, a China equity strategist from UBS Securities, said that the average profit growth rate of A-share companies is likely to reach 8 percent in 2026, up from 6 percent this year.

Combined with incremental macroeconomic supportive policies, lower risk-free interest rates, more household savings being invested in the stock market, the continued net inflow of long-term capital, and the advancement of public companies’ market valuation management, the A-share market valuation is likely to move up further, he said.

Allen Lee, head of China business development at asset manager AllianceBernstein, said that more Chinese companies with higher operation efficiency and international competitiveness will be nurtured in the upcoming years as “disruptive innovation” will be a major theme of China’s economic development.

Data from market tracker Wind Info showed that A-share companies specializing in technology innovation and high-end manufacturing have attracted the most surveys from foreign institutional investors this year.

Source: China Daily

 


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