[ET Net News Agency, 4 January 2021] Citi Research lifted its 12-month HSI, HSCEI, and
CSI300 targets to 30,054 (was 28,414, up 6%), 11,609 (was 11,550, up 1%), and 5,525 (was
5,471, up 1%), based on updated estimates for EPS, power demand and M2 growth.
The research house forecast China's GDP growth to accelerate to 16% in 1Q and 8.2% in
2021, mostly driven by private-sector investment and consumption. It recommended that
investors "overweight" private consumption in 2021, avoiding uncertainty from possible
China's policy responses to excessive gearing and fixed asset price appreciation.
Citi's top H-share "buy" names for 2021 are private, consumed-related companies, namely
Tencent (00700), Ali Health (00241), Topsports (06110), China Feihe (06186), Geely Auto
(00175), Kingdee (00268), and ENN Energy (02688).
Citi believes tightening in 2021, if any, will be counter-cyclical, which might be
comparable to that of 2017 considering that China's economy has largely recovered to its
pace prior to the COVID-19 epidemic coupled with solid exports (estimated to rise 1.8% in
2020 and gain 3.5% in 2021). (KL)