**Market Overview** Last week, neither two key domestic meetings nor the Fed's December rate cut provided significant stimulus to the Hong Kong stock market, primarily due to underwhelming surprises. This week brings several uncertainties: 1. The U.S. will release November non-farm payroll data, including revised October figures—the first major employment report post-government shutdown. 2. The Bank of Japan’s rate decision on Friday will draw global capital attention. Weakness in U.S. tech stocks (e.g., Oracle) may exacerbate pressure if the BOJ hikes rates.
Domestically, policy effectiveness hinges on whether real estate and consumption sectors can gain traction, while financials remain stable.
**Key Themes** - **Hainan Free Trade Port** (Dec 18 closure): "Zero tariffs, low tax rates" policy benefits cross-border trade, duty-free retail, and logistics. Hainan’s e-commerce GMV is projected to grow 300% by 2026. - **NVIDIA’s closed-door summit** this week addresses AI-era power shortages. Media reports highlight rising gas turbine demand from AI data centers—a theme already priced in last Friday. - **Beijing Economic-Tech Zone** plans fusion energy investments, supporting ITER participation. Fusion energy warrants attention. - **NDRC** pledges faster "AI+" consumption policies, aligning with recent trends like AI glasses. - **National Healthcare Security Administration** aims for near-zero childbirth costs by 2025, but follow-up policies are critical. Monitor assisted reproduction and infant care sectors.
**Stock Pick: SIHUAN PHARM (00460)** SIHUAN PHARM invested in Switzerland’s Suisselle, securing exclusive rights to distribute CELLBOOSTER hydrodermic needles globally. This follows its 2021 acquisition of Genesis Biosystems (U.S.), expanding its North American footprint. Suisselle’s CE-certified CELLBOOSTER series leads the stable compound hydrodermic needle market, with additional salmon DNA and exosome therapies.
**Business Highlights**: 1. **Botulinum Toxin**: Fast-growing Letybo (900 RMB wholesale; 1,300–1,400 RMB retail). Shipments: 600k (2023), 800k (2024), 1.2m (2025e), 1.5m (2026e). Revenue: 1B+ RMB (2025), 1.2B+ RMB (2026); 30%+ margins. 2. **Dermal Fillers**: Self-developed "Youthful" and "Maiden" lines (launched July 2024) priced at 2,000 RMB (wholesale; 8,000–12,000 RMB retail) and 4,000 RMB (wholesale; 14,999 RMB retail), respectively. Targets: 200k (2025), 500k (2026). 3. **Pipeline**: Animal collagen, recombinant human collagen, PHA microspheres, and silk protein under development. 4. **Financials**: Aesthetic segment revenue: 700m RMB (2024e), 1.1–1.2B RMB (2025e; 400m profit), 2B+ RMB (2026e; 600–700m profit).
**Sector Watch: Reusable Rockets** - **Dec 17**: CASC’s Long March 12A (first state-backed reusable rocket) debut launch/recovery test in Jiuquan. Success would make China the second nation to master the tech, cutting launch costs below 10,000 RMB/kg. - **Late Dec**: Private firm Tianbing Technology’s Tianlong-3 (17–22-ton LEO capacity; 50x reusable) to test "parachute + retro-thrust" sea recovery. Dubbed "China’s Falcon 9." - **Early 2025**: iSpace’s Hyperbola-3 and CASC’s Long March 10A (manned missions) trials.
**Market Data** - Hang Seng Index (Dec) futures: 104,657 open contracts; 38,942 net. Settlement: Dec 30, 2024. - HSI at 25,977; bullish above mid-axis resistance. - Fed’s rapid liquidity re-injection (short-term bond purchases) signals quasi-QE, likely extending to long-term bonds.
**Strategy Insight** The Central Economic Work Conference emphasized "expanding domestic circulation." Next year’s focus shifts to corporate margin recovery (vs. volume growth). Key takeaways: - **External demand**: 2023 outperformed, but 2024 faces trade complexities and potential RMB appreciation. - **Domestic demand**: Policy support (monetary easing, income growth initiatives) may surprise positively.
**Stocks to Watch**: AVICHINA (02357), C STRATEGIC TEC (01725).
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