Chapter 220: When luck comes, heaven and earth will work together, when luck is gone, heroes will not be free

Thursday, March 28, 2024.

Last night, the investment circle was quite turbulent.

Because several heavyweight annual reports have been disclosed one by one.

Annual report season, bombshell season, some are happy while others are sad.

China Everbright Bank's revenue in 2023 fell by 3.92% year-on-year, and its net profit fell by 8.96% year-on-year, making it the second bank stock in the industry with declining profits.

Industrial and Commercial Bank of China's revenue decreased slightly, profit increased slightly, and dividends remained unchanged. Bank of Communications' revenue and profit increased slightly.

What is most worrying is that among these banks, the bad debt rate of real estate loans has reached about 5%, which has a significant drag on performance.

In addition to banks, Sunac China, once a real estate star company, also released its 2023 annual report. Its revenue reached 154.23 billion yuan, a year-on-year increase of 59.4%, but it still suffered a loss of 7.97 billion yuan and had interest-bearing liabilities of 277.83 billion yuan.

Li Feng opened the K-line chart of Sunac China and couldn't help but sigh in his heart.

Now Sunac China is only HK$1.12. Looking back at the new high of HK$49.55 set at the end of 2019, it is like looking up at an unreachable mountain.

In just over four years, the stock price has dropped by 0.02%, then halved again, halved again, and halved again...

If an investor buys at the top of the mountain, out of a million-dollar investment, he may only have 20,000 yuan left.

In addition, there is a former star enterprise, Country Garden.

The annual report, which was supposed to be released yesterday, has not been released until today. There are reports that they are preparing for liquidation...

I don’t know whether it’s true or not.

Its stock price is now only 0.480 yuan, which is far from its previous highest point of 19.160 yuan.

There is also China Evergrande, once the real estate leader.

The stock has been suspended for a long time, and the share price has been fixed at HK$0.163. The company has begun to prepare for bankruptcy liquidation, and it is unknown how much investors can get back.

There is also R&F Properties, which issued an announcement: it is expected to suffer a net loss of approximately 19.5 billion yuan in 2023.

Life is like a chess game.

In just five years, the world has changed dramatically.

Looking back to the time when the real estate cycle started in 2015-2017, the housing market was booming and people across the country were buying houses. The companies in the related industry chain were so high-spirited, making great strides and making a lot of money...

Looking at today, at the end of the real estate cycle, the housing market is withering, and the companies in these industry chains are suffering heavy losses. How desolate it is...

Are these companies not working hard enough?

Is it that the talent managing the company is not good enough?

The answer is obviously no.

The people are still the same group of people, but the cycle is different and the glory is gone.

When luck comes, heaven and earth are on your side; when luck is gone, heroes are helpless.

Many times, the success of many companies, including our investors, is not because of how good you are, but because you happen to stand on the tide of the times.

When the wind comes, even pigs can fly into the sky.

Similarly, the failure of many companies and many industries is not because they don’t work hard enough, but simply because they are at the bottom of the cycle.

Going against the trend will lead to failure even if you don't lose.

Therefore, whether it is investment, business, or life, we must be respectful and strive for self-improvement.

In the darkness, try to look up to the light,

Even when you are in a brilliant situation, you should also learn to be reserved and cherish your blessings.

Looking back further, time stopped at the end of 2015.

At the Central Economic Work Conference that year, the top leadership emphasized the five major tasks of reducing overcapacity, destocking, deleveraging, reducing costs, and addressing shortcomings.

Some industries have very strong enforcement, such as the coal, steel, and cement industries. After the industry was cleared, they have had several years of good times, especially the coal industry, whose index has drawn five consecutive annual lines.

Some industries, such as real estate, are still constantly acquiring land, building houses, borrowing money, and expanding, hoping to get every last penny.

As a result, the inventory keeps growing and the tail is difficult to get rid of.

In the end, at the end of the real estate cycle, the entire industry was in a mess.

Most of the companies that expanded recklessly are insolvent, and bankruptcies, liquidations, and delistings are common. Even leading companies that are restrained in land acquisition and financially prudent are living a very tight life, and all kinds of negative rumors are coming one after another.

In addition, there are some companies that have done an excellent job in de-dependence on real estate, and their performance has improved significantly.

For example, the two home appliance giants, Haier Smart Home and Midea Electric Appliances, which released their annual reports yesterday, both achieved double-digit growth in revenue and profits, and their dividend rates were also good.

In my impression, these two companies have achieved great success in product high-end and diversification, as well as in developing overseas markets.

Therefore, after suffering the downturn of the domestic real estate cycle and a sharp drop in stock prices, it regained its footing and delivered a good performance.

As I was sighing, the Shanghai Composite Index opened.

Today, the Shanghai Composite Index opened lower at 2988 points. China Everbright Bank's stock price plummeted by more than 6% at the opening and quickly fell by more than 9%, just one step away from the lower limit.

Other bank stocks were also dragged down sharply, and the market was quite nervous.

Many investors believe that the Shanghai Composite Index will continue to fall by inertia, driven by the bank stock index.

It's bottomless.

However, the Shanghai Composite Index adjusted for only half an hour before it began to rise unexpectedly rapidly.

Non-ferrous metal stocks began to soar again, with Yunnan Aluminum rising more than 7%, Baowu Magnesium rising more than 6%, and Luoyang Molybdenum rising more than 3%, setting a new high of 8.28 yuan!

Zijin Mining, China National Gold Mining, and Western Mining all saw their stock prices rise continuously...

When the market falls, they don't fall; when the market rises, they soar.

Unknowingly, several years have passed, and the Shanghai Composite Index is still over 3,000 points. However, the share prices of some stocks have quietly surpassed the high of 3,700 points, while some stocks have fallen into an abyss.

Stock trading is all about speculating on expectations.

In the past few years, stocks in the real estate industry chain have fallen across the board, and stocks in the consumer liquor and new energy sectors have collapsed across the board.

However, strong cyclical stocks represented by kerosene, nonferrous metals and shipping have gone against the trend and strengthened, with some stocks even doubling or multiplying their prices.

It has to be taken seriously.

Yesterday, the annual reports of China Aluminum Corporation, Yunnan Aluminum Corporation, as well as Zijin Mining and Luoyang Molybdenum Co., Ltd. released some time ago, all exceeded the expectations of many investors.

One can't help but look forward to the first quarter reports of these stocks.

It also thoroughly stimulated the bullish enthusiasm in today's market.

By the end of midday, the Shanghai Composite Index had risen by more than 1% and re-entered 3,000.

——————

Fellow stockholders, use your hands to make money and send a free gift of love.

Your support is my motivation to update.