China Equity Strategy: Focus List Changes – China/HK and A-share Thematic
Summaries are public. PDF access requires an active membership; all members have the same access. Sign in
Morgan Stanley has adjusted its China/HK and China A-share thematic Focus Lists. For the China/HK Focus List, the firm added Sinoma Technology (002080.SZ) and removed PetroChina-H (0857.HK). For the A-share Thematic Focus List, the firm added Ping An of China (601318.SS) and removed PetroChina-A (601857.SS).
Sinoma Technology benefits from surging demand for specialty electronic fiberglass, a critical PCB raw material driven by AI infrastructure expansion. Additionally, its battery separator business is rebounding due to Chinese energy storage demand, and offshore wind acceleration supports large wind turbine blade demand. Sinoma is projected to deliver net profit growth of 101%, 63%, and 45% for 2025, 2026, and 2027, respectively. Its current valuation remains highly attractive at 21.9x 2026 PE, well below its historical peak of 36.2x.
Ping An of China was added to the A-share Thematic Focus List due to its diversified expansion into wealth management, healthcare, and elderly care. The firm highlights strong value of new business (VNB) growth in life insurance, mitigating property risks after years of subsidiary impairments, and the potential for AI applications to reduce costs and improve efficiency. Ping An trades at an attractive A-share valuation of approximately 1.1x F26E P/B, offers a dividend yield above 4%, and maintains a mid-double-digit group ROE.