In the context of China's economic transformation, the machinery industry has both risks and opportunities. On the one hand, China's economy has shifted from the traditional mode of investment and export driven to the new growth mode focusing on expanding domestic demand, which will inevitably bring about a decline in the growth rate of fixed assets investment, making the machinery industry, which is mainly capital goods, face the pressure of slowing growth. On the other hand, economic transformation requires changes in income distribution, which has promoted the level of mechanization and driven the deep transformation of the machinery industry, opening up space for the structural high-speed growth of the machinery industry.
In the context of a weak market, seeking investment opportunities during transformation. The transformation of the mechanical industry will bring about emerging industries and new business models, leading to rapid growth in certain fields that exceeds the industry average level, and the birth of a group of enterprises with rapid development potential. For the capital market, such industries and enterprises will not only have high performance growth guarantees due to the rapid growth of future performance, but also enjoy valuations that exceed the industry average due to the huge potential for future development in the early stages of growth. Short term investments are more flexible, while medium to long term investments are more suitable for value investing.
Seize investment opportunities through two main lines. The development and upgrading of emerging industries are our two main lines.
Aviation manufacturing industry - a strategic emerging high-tech industry, with a focus on aviation power;
Energy saving and environmental protection equipment - an emerging industry that is developing from a resource-dependent extensive to an intensive manner, with a focus on Koda Electromechanical, Dayu Water Saving, Sanchuan Co., Ltd., and Shaangu Power;
Automation and intelligent equipment - upgrading from labor-intensive to technology-intensive industries, with a focus on robots;
Manufacturing service industry - an industrial upgrade that extends towards both ends of the smile curve, with a focus on Shanghai Jiahao, Jerry Co., Ltd., Keda Electromechanical, and Shaangu Power.