Recommended Stock：China Resources Beer（291）
Beer is typically seen as a summer beverage, closely associated with outdoor activities and social gatherings. When temperatures drop, outdoor activities decrease, and the frequency of social gatherings may also decline, which generally makes cold winters unfavorable for beer sales. However, according to predictions from the National Climate Center and several meteorological agencies, most regions in China are expected to experience higher temperatures than usual during this winter (from December 2024 to February 2025). Warmer temperatures could potentially benefit the sales of China Resources Beer. To recap, the group's revenue for 1H24 reached RMB 23.7bn. Although overall beer sales volume decreased by 3.4% yoy, sales of high-end products saw significant growth, with mid-range and above beers accounting for over 50% of total sales for the first time. This indicates that the company's premiumization strategy has been successful. China Resources Beer is actively deepening its "beer + liquor" dual empowerment business model and is intensifying efforts to control capital expenditures. The market expects that in 2025, China Resources Beer’s revenue and profit will grow by 4% and 11%, respectively. Target price: $32
PPI data higher than expected
The S&P 500 ended lower on Thursday as U.S. inflation data came in stronger than expected and U.S. Treasury yields climbed. Producer prices rose more than expected in November. After being raised to 0.3% in October, they rose 0.4% in November, higher than the expected increase of 0.2%. While the unexpected rise in PPI is not expected to affect expectations of a rate cut at next week's Fed meeting, it further highlights the need for a patient approach to monetary policy through 2025.
Hong Kong Stock Connect had a net outflow of HK2.92bn on Thursday of which Alibaba (9988) had the largest net inflow, reaching HK$1.04bn; followed by Xiaomi (1810). Tracker Fund (2800) recorded the largest net outflow at 4.12bn, followed by Tencent (700).
The Central Economic Work Conference was held in Beijing a few days ago. The lack of specific figures disappointed the market, and Hong Kong stock market fell today. The HSI opened 158 points lower and then expanded its losses, falling 425 points or 2.1% today to 19,971. The HSCEI closed at 7,186, down 173 The daily market turnover total transaction volume was HK$158.5bn. Domestic demand stocks generally fell, with individual stocks such as Budweiser Asia Pacific (1876), Haidilao (6862) and Anta (2020) all falling by more than 3%.
Source: KGI Investment Strategy
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Statements from Federal Reserve officials suggesting support for a 0.25% rate cut in December, coupled with political disruptions such as the potential collapse of the French government and the sudden imposition of martial law in South Korea, have slightly increased risk aversion, leading to a flow of funds into the market…