As the "9·24" market rally approaches its second anniversary, Wind data reveals that from September 24, 2024, to the latest closing date, 783 stocks in the Shanghai and Shenzhen markets recorded declines after excluding 78 ST and *ST risk-warning stocks, representing 14.09% of the 5,557 listed companies. These underperformers are not exclusively small-cap stocks with weak fundamentals. China Vanke Co.,Ltd. (000002.SZ) fell 53.25% during the period, Wuliangye Yibin Co.,Ltd. (000858.SZ) dropped 40.79%, while Chongqing Changan Automobile Co., Ltd. (000625.SZ) and Pien Tze Huang Holdings Co., Ltd. (600436.SH) each declined over 35%. Other former blue-chip favorites such as Great Wall Motor Co., Ltd. (601633.SH), Wuliangye Yibin Co.,Ltd. (000858.SZ), and Shenzhen Mindray Bio-Medical Electronics Co.,Ltd. (300760.SZ) also appear on this list. Despite the A-share market offering ample profit opportunities across most trading days over the past two years, these companies have yet to return to their pre-rally starting points. By sector, the 783 declining stocks are heavily concentrated in the three major industries of pharmaceuticals and biotechnology, automobiles, and power equipment. This week, however, traditional sectors such as pork and baijiu, which had been persistently sold off by capital, have rebounded, shifting market focus to the question of how far this recovery can go.
Since September 24, 2024, the A-share market has launched an upward rally, with the overall index center rising over the two-year period. Taking that date as the benchmark, 861 stocks currently trade below their starting prices, which narrows to 783 after excluding 78 ST and *ST stocks subject to risk warnings. Of these 783, approximately 235 are newly listed stocks that debuted after September 24, 2024, meaning their "interval price change" is calculated from their first trading day, with declines primarily driven by valuation corrections of new listings rather than the "9·24" rally. After removing these, 548 stocks that were already listed before the rally and remain in decline qualify as "old stocks." Among this group, the most prominent are a batch of "core assets" from previous bull markets. Baijiu was a star sector in the core-asset rally around 2021 and once boasted the highest institutional allocation. By Shenwan secondary industry classification, 15 baijiu stocks remain in negative territory: Anhui Kouzi Distillery Co., Ltd. (603589.SH) leads with a 43.75% decline, Jiangsu Yanghe Brewery Joint-Stock Co., Ltd. (002304.SZ) has fallen over 40%, Wuliangye Yibin Co.,Ltd. (000858.SZ) is down 28.95%, Anhui Gujing Distillery Co., Ltd. (000596.SZ) has dropped 24.11%, and both Shanxi Xinghuacun Fen Wine Factory Co., Ltd. (600809.SH) and Luzhou Laojiao Co., Ltd. (000568.SZ) have declined over 12%. Notably, Kweichow Moutai Co.,Ltd. (600519.SH) does not appear on this list, yet it has still fallen 1.14% year-to-date. The baijiu sector has continued its correction this year, with Jiangsu Yanghe Brewery Joint-Stock Co., Ltd. (002304.SZ) down 32.34% year-to-date, Wuliangye Yibin Co.,Ltd. (000858.SZ) down 29.68%, and Luzhou Laojiao Co., Ltd. (000568.SZ), Shanxi Xinghuacun Fen Wine Factory Co., Ltd. (600809.SH), and Anhui Gujing Distillery Co., Ltd. (000596.SZ) all down over 20%.
The photovoltaic and new energy tracks, which attracted the most capital from 2021 to 2022, also hold significant positions on the list. Tongwei Co., Ltd. (600438.SH) is down 44.49% year-to-date, Longi Green Energy Technology Co.,Ltd. (601012.SH) has fallen 35.33%, and JinkoSolar Holding Co., Ltd. (688223.SH) is down 28.01%. Measured from the start of the "9·24" rally, photovoltaic tracker manufacturer Arctech Solar Holding Co., Ltd. (688408.SH) has declined 61.92%, making it one of the deepest decliners in the photovoltaic sector. Module maker Trina Solar Co., Ltd. (688599.SH) hit an all-time low of RMB 11.14 on September 3, down 32.02% for the year and off 86.8% from its historical peak. Declines in the automobile sector have accompanied years of intense price competition. Chongqing Changan Automobile Co., Ltd. (000625.SZ), Great Wall Motor Co., Ltd. (601633.SH), and Seres Co., Ltd. (601127.SH) have all fallen over 34%, while Guangzhou Automobile Group Co., Ltd. (601238.SH) is down 29.30%. Real estate and consumer leaders have also failed to recover fully: China Vanke Co.,Ltd. (000002.SZ) is down over 53%, China Merchants Shekou Industrial Zone Holdings Co., Ltd. (001979.SZ) has fallen 25.66%, Pien Tze Huang Holdings Co., Ltd. (600436.SH) is down over 35%, and Shanghai RAAS Blood Products Co., Ltd. (002252.SZ) and Shenzhen Mindray Bio-Medical Electronics Co.,Ltd. (300760.SZ) have also performed weakly.
The list displays two common characteristics: first, the declining stocks are heavily concentrated in industries that have experienced overcapacity or demand-side pressure over the past two years; second, a considerable portion of these companies have yet to see substantive improvement in their fundamentals, with valuation digestion still underway. By Shenwan primary industry classification, among the 783 declining stocks, healthcare and biotech lead with 103 stocks, followed by automobiles with 79, power equipment with 66, basic chemicals with 62, machinery with 57, electronics with 49, computers with 47, light manufacturing with 32, food and beverages with 32, and media with 24. The three sectors of healthcare/biotech, automobiles, and power equipment collectively account for 248 stocks, or more than 30% of the total. In healthcare/biotech, for example, declining stocks span traditional Chinese medicine, medical devices, and in-vitro diagnostics, with Beijing Tongrentang Co., Ltd. (600085.SH) down 19.17% and Shenzhen New Industries Biomedical Engineering Co., Ltd. (300832.SZ) down 20.13%. At the Shenwan secondary industry level, the distribution of declining stocks becomes clearer: auto parts account for 61, medical devices 41, chemical products 31, photovoltaic equipment 25, specialized equipment 23, chemical pharmaceuticals and software development 21 each, and power grid equipment, household products, and real estate development 19 each. Auto parts and medical devices together account for 102 stocks, or 13% of all decliners. The deepest decliners are concentrated in photovoltaic equipment, batteries, power grid equipment, auto parts, and medical devices: Arctech Solar Holding Co., Ltd. (688408.SH) has fallen nearly 62%, medical device company Jianerkang Medical (603205.SH) is down 57.44%, battery firm Shangshui Intelligent Equipment (301513.SZ) has dropped 56.25%, and real estate stock Zhongjiao Development (000736.SZ), power grid equipment stock Sanxing Electric (601567.SH), and auto parts stock Taihong Wanli (603210.SH) have all declined over 55%. By market capitalization, stocks in the RMB 5 billion to RMB 10 billion range are the most concentrated with 208 stocks; those below RMB 5 billion total 296, and together they account for over 60% of all declining stocks. However, 64 companies with market caps above RMB 50 billion are also on the list, indicating that large-cap stocks are not inherently safe. In terms of decline distribution, 291 stocks fell less than 10%, 270 fell between 10% and 30%, 157 fell between 30% and 50%, 59 fell between 50% and 70%, and 6 fell over 70%. Among them, 65 stocks have fallen over 50%, meaning investors are not just "trapped"—at current prices, these stocks would need to more than double to return to their starting points.
Traditional sector rebound: Liquidity replenishment or fundamental reversal?
Entering September, conditions for traditional industry stocks have shifted somewhat. Over the five trading days from August 31 to September 4, previously sluggish traditional sectors staged a rebound. By Shenwan primary industry classification, since September, the five indices for agriculture/forestry/animal husbandry/fishing, commercial retail, banking, media, and food and beverages have led gains, with agriculture/forestry/animal husbandry/fishing rising 3.86% month-to-date, ranking first across all industries. The pork sector rebounded most sharply. Tiankang Biopharmaceutical (002100.SZ) and Yunnan Shennong Agricultural Industry Group Co., Ltd. (605296.SH) have both risen over 18% in the past 20 days; Wens Foodstuff Group Co., Ltd. (300498.SZ), New Hope Liuhe Co., Ltd. (000876.SZ), and Muyuan Foods Group Co.,Ltd. (002714.SZ) have also outperformed the broader market this month. The baijiu sector has warmed up in tandem but at a more moderate pace. Anhui Gujing Distillery Co., Ltd. (000596.SZ) rose 7.74% over five days and 10.34% over 20 days, Shanxi Xinghuacun Fen Wine Factory Co., Ltd. (600809.SH) gained 2.97% over five days, and Kweichow Moutai Co.,Ltd. (600519.SH), Luzhou Laojiao Co., Ltd. (000568.SZ), and Jiangsu Yanghe Brewery Joint-Stock Co., Ltd. (002304.SZ) have also risen noticeably compared with earlier levels. In the home appliance and consumer sectors, Haier Smart Home Co., Ltd. (600690.SH) rose 4.17% over five days, China Tourism Group Duty Free Corporation (601888.SH) gained 2.34%, and Midea Group Co., Ltd. (000333.SZ) rose 1.55%. The property sector has shown divergence, with China Vanke Co.,Ltd. (000002.SZ) up 2.53% over five days, Poly Developments and Holdings Group Co., Ltd. (600048.SH) up 1.16%, but China Merchants Shekou Industrial Zone Holdings Co., Ltd. (001979.SZ) down 2.65%.
A securities analyst interviewed on the reasons for this rebound believes that after prolonged declines, chips in traditional industries have been significantly cleared, making the recent rally closer to a liquidity replenishment event. Capital has been flowing concentratedly into the technology sector in recent months, continuously draining traditional industries; once tech sector crowding rises, some capital rotates back to low-positioned, high-expectation assets. "The first phase of a rebound in oversold sectors typically does not focus on fundamentals but on positioning and chip structure. When the tech sector's main rally wave absorbed market capital in May and June, traditional industries experienced consecutive overselling, further clearing chips. Over the past two weeks, as the A-share market has seen sustained volume contraction, traditional industries with oversold prices, clean chip structures, and lower resistance to upward movement have become the preferred targets in a stock-game environment," said a private equity fund manager from East China. However, the liquidity replenishment has not occurred uniformly across all traditional sectors. The photovoltaic sector was still declining this week, suggesting that capital remains cautious about expectations for improved supply-demand dynamics. Institutions are also divided on the future trajectory of traditional industries. One view holds that after two years of adjustment, valuations in some traditional sectors have adequately reflected pessimistic expectations, with institutional positions at relatively low levels and room for valuation repair. Another view cautions that until an earnings inflection point is confirmed, rallies lacking profit support are more likely to appear as pulse-like movements. Whether liquidity replenishment can translate into a trend ultimately depends on earnings expectations. Based on 2026 interim reports, earnings inflection points in the aforementioned sectors have yet to emerge. In the pork sector, Muyuan Foods Group Co.,Ltd. (002714.SZ) reported first-half revenue of RMB 59.41 billion, down 22.30% year-over-year—its first revenue decline for the same period in nearly a decade—with a net loss attributable to parent of RMB 6.078 billion. Leading pork producers New Hope Liuhe Co., Ltd. (000876.SZ) and Wens Foodstuff Group Co., Ltd. (300498.SZ) also posted substantial losses in their interim reports. The photovoltaic sector remains in its downward cycle since Q4 2023, with Tongwei Co., Ltd. (600438.SH), Longi Green Energy Technology Co.,Ltd. (601012.SH), and TCL Zhonghuan Renewable Energy Technology Co., Ltd. (002129.SZ) having posted 11 consecutive quarters of net losses. Tongwei Co., Ltd. (600438.SH) reported first-half revenue of RMB 34.357 billion, the lowest for the same period since 2021, down 15.19% year-over-year, with a net loss attributable to parent of RMB 5.119 billion. The baijiu sector has regressed to levels seen a decade ago: Kweichow Moutai Co.,Ltd. (600519.SH) posted first-half net profit attributable to parent of RMB 44.517 billion, down 1.95% year-over-year, marking its first decline for the same period in nearly 20 years; Jiangsu Yanghe Brewery Joint-Stock Co., Ltd. (002304.SZ) saw its revenue scale fall to 2016 levels, declining a further 28.7% to RMB 10.54 billion in the first half after a 35.32% year-over-year reduction in the prior-year period, with net profit attributable to parent of RMB 2.602 billion, down 40.10% year-over-year—the lowest since 2012; Wuliangye Yibin Co.,Ltd. (000858.SZ) posted first-half net profit attributable to parent of RMB 8.753 billion, up 89.30% year-over-year, though this growth is based on a low base from the prior-year period. "Stock prices can lead fundamentals, but they cannot remain detached from them for long," said the aforementioned securities analyst. After the valuation repair driven by liquidity replenishment, the market will still need to reassess when baijiu, real estate, and consumer earnings will see substantive reversals, which will determine whether this round constitutes a genuine repair or merely a rebound.
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