April's top stocks announced! Industry distribution shifts, sellers call out "perfect hitting point"

Cailian Press April 1 News (Reporter Gao Yanyun) April’s top stock picks big data released.

As of April 1, 40 securities firms’ research institutes have successively released their April stock pick portfolios, with a total of 435 recommendations, covering 285 targets after deduplication. From the market distribution perspective, Hong Kong stocks have become a major highlight this month, with 72 recommendations involving 44 targets; the ChiNext, STAR Market, and Beijing Stock Exchange targets received 61 (36 targets), 37 (33 targets), and 1 (1 target) recommendations respectively.

In terms of individual stock popularity, April’s top stocks show certain concentration, with 10 targets including Zhongji Xuchuang, China Jushi, Zijin Mining, CNOOC, COSCO Shipping, WuXi AppTec, Satellite Chemical, Geely Auto, BYD, and Anjoy Food being particularly favored, becoming the core targets heavily recommended by securities firms.

More notably, the industry distribution of top stocks has experienced a significant “shift,” with the electronics sector, which has ranked first in recommendation frequency for two consecutive years, dropping to fifth place this month; power equipment, biomedicine, non-ferrous metals, and basic chemicals have entered the top four, becoming the core sectors for securities research this month.

Additionally, the recommendation frequency for banks and utilities has doubled month-over-month, while the electronics and military sectors saw a decline of over 40%, indicating a clear divergence in industry popularity.

Multiple stocks recommended continuously for several months

Among the highly regarded “top stock” list, some leading companies have received collective favor from multiple securities firms.

Data from the APP shows that among computing concept stocks, Zhongji Xuchuang’s recommendation level remains high, being recommended by 9 firms simultaneously this time, after being recommended by 11 firms in January, 9 in February, and 8 in March.

Furthermore, lithium battery leader CATL is recommended by 8 firms, China Jushi and Zijin Mining are each recommended by 6 firms, with these two targets being recommended 6 and 7 times respectively in March.

Targets recommended by 5 firms this time include 9 stocks: CNOOC, COSCO Shipping, WuXi AppTec, Satellite Chemical, ConoYa-B, Geely Auto, BYD, Anjoy Food, and TCL Electronics.

Targets recommended by 4 firms include 5 stocks: Yankuang Energy, Xinyi Solar, Wanhua Chemical, Kweichow Moutai, and Baofeng Energy.

Targets recommended by 3 firms total 14, including China Pacific Insurance, XinQi Microelectronics, BTG Hotels, Ningbo Bank, Kedaali, Kangfang Biotech, Keger Precision, Jinjiang Hotels, Hongdu Aviation, Hangzhou Bank, Haitian Flavouring, Guming, Ganfeng Lithium, and Dekang Agriculture and Animal Husbandry.

Targets recommended by 2 firms total 46, not listed here individually.

Industry distribution “significantly changed”

The industry distribution of April’s top stocks shows obvious structural changes. The electronics sector, which has ranked first in recommendation frequency for two consecutive years, fell to fifth place this month. Power equipment, which has maintained high popularity for several months, rose from fifth to first place this month. The “overseas energy substitution” logic continues to ferment, becoming a core market focus, significantly boosting the sector’s recommendation heat.

The biomedicine sector’s recommendation frequency also rose in tandem, climbing from sixth in February to fifth in March, and further to second this month. Industry analysts believe that the rise in biomedicine’s recommendation is mainly due to increased business development (BD) activity, coupled with the clearer positioning of the industry as an emerging pillar sector, with market expectations gradually recovering.

Non-ferrous metals and chemicals, ranked third and fourth, are cyclical sectors. After previous corrections, their valuations are relatively low, further highlighting their investment value and attracting increased recommendation efforts from securities firms.

Regarding the cooling of the electronics sector, sell-side analysts generally believe it is mainly influenced by three factors: first, geopolitical conflicts have shifted market hotspots, with funds flowing from electronics to defensive and pro-cyclical sectors; second, the mapping effect of overseas markets on related sectors has weakened, and the narrative of AI tracks is hard to sustain, weakening the core logic supporting electronics; third, electronics has maintained high heat for two years, and the industry cycle is entering a phase of cooling, with profit-taking needs emerging.

Looking at specific industry recommendation rankings, the top ten sectors this month are: Power Equipment (9.66%), Biomedicine (7.73%), Non-ferrous Metals (7.01%), Basic Chemicals (7.01%), Electronics (6.52%), Communications (6.28%), Automobiles (4.83%), Machinery Equipment (4.83%), Food & Beverage (4.59%), Transportation (3.62%).

Other sectors with recommendation rates below 1% include Steel, Building Materials, Conglomerates, Textiles & Apparel, and Environmental Protection.

Month-over-month, the sectors with the largest increase in recommendation rate are: Banking (+125.33%), Utilities (+109.33%), Social Services (+82.56%), Power Equipment (+68.16%), and Communications (+52.55%). The sharp rise in banking recommendations is mainly due to increased market risk aversion, with funds flocking to low-volatility, high-dividend banks; the rise in utilities aligns with the “energy substitution” logic of power equipment, driven by energy supply security needs; the increase in social services is attributed to shifting market focus to domestic demand recovery, along with a trend of “anti-involution,” leading to renewed valuation of high-quality targets.

The sectors with the largest month-over-month decline are: Electronics (-45.71%), Defense & Military (-40.71%), Computers (-22.5%), Real Estate (-21.4%), and Non-ferrous Metals (-18.79%). Among these, defense and military’s attention has rapidly declined, mainly due to market expectations of geopolitical conflict intensity weakening, reducing the sector’s risk-hedging and event-driven appeal, leading to profit-taking and lower recommendation levels.

Sell-side: Do not lose your nerve, the market is showing an important bottom and hitting point

Regarding the April market trend and the logic behind stock pick allocations, chief strategists from major securities firms have expressed their views, generally leaning optimistic.

CITIC Securities’ chief A-share strategist Qiu Xiang mentioned in a research report that the short-term capital market remains in a cooling sentiment phase, with risk-averse attitudes possibly leading to some reduction in holdings. For allocation, he recommends continuing to focus on China’s advantageous manufacturing industries and waiting for April’s decisive moments.

Guotai Huatong Strategy’s chief analyst Fang Yi believes that after market adjustments, investors should not lose confidence; China’s stock market is at an important bottom and hitting point. The correction presents opportunities, and active deployment is advised. In industry comparison, financials and stability remain top choices, with optimism towards Chinese tech manufacturing and stable domestic demand.

Huatai Securities’ report suggests that as April approaches, with A-shares entering a period of intensive earnings disclosures, market pricing anchors are expected to gradually penetrate emotional disturbances and return to fundamentals. For allocation, moderate focus should be on coal, power chain, and chemical raw materials benefiting from high oil prices and price pass-through capabilities, along with low-positioned essential consumer staples as core holdings.

(Reporter Gao Yanyun, Cailian Press)