The Zhitong Finance App learned that the concept of three children is being catalyzed again! Recently, it was reported that the “Implementation Measures for Optimizing Fertility Policies and Promoting Long-term Balanced Population Development in Zhengzhou” was fully implemented on September 1. The “Measures” mention that couples with young children up to the age of 3 enjoy 10 days of childcare leave each year; families with three children with a newborn have a one-time allowance of 15,000; families with many children enjoy policy preferences for renting and buying a house in Zhengzhou. Related concept stocks: Beikang Medical (02170), Aidi Palace (00286), Jinxin Reproduction (01951),Chinese Flying Crane (06186).
On August 31, in order to further reduce the burden of childbearing and upbringing on families, the State Council issued a notice on raising the special additional deduction standards relating to personal income tax. Among them, it is mentioned that the special additional deduction standard for the care of infants under 3 years old has been raised from 1,000 yuan to 2,000 yuan per month for each infant and child.
Policies introduced by Guangdong Province, Anhui Province, Hunan Province, and Zhejiang Province have responded.Various regions have also introduced policies one after another to encourage childbearing.In terms of recent developments, on August 29, according to the website of the Chongqing Municipal Medical Security Bureau, the Chongqing Municipal Health Insurance Bureau said that from September 1, insured persons applying for benefits related to maternity insurance will no longer be charged maternity service certificates, reproduction service certificates, or marriage licenses. On August 17, the Kunming Housing Provident Fund Management Center issued a new policy to increase the maximum housing provident fund loan amount for families with two and three children by 1.04 million yuan. On August 11, the Development and Reform Bureau of Shengsi County, Zhoushan City, Zhejiang Province recently revealed in response to a proposal from CPPCC members that it plans to pay childcare allowances for unemployed locally registered women aged 0-3 who give birth to children with local domicile registration.
Furthermore, Zhejiang Province's real money encourages childbearing, with a maximum “prize” of 46,000 yuan. Changshan County grants 30,000 yuan to families with successful assisted reproduction and 1,000 yuan for first-time married couples aged 25 and under. If you give birth to three children in Longgang City, Wenzhou, you can receive a total of 46,000 yuan in maternity allowances and parenting allowances.
In addition to local governments,Many companies have also joined the ranks to encourage childbearing. For example, on August 31, “Where to Go” announced that starting September 1, it will establish a maternity allowance benefit “Camel Second Generation Growth Gift” for employees. All regular employees of the company who have reached the age of three years and above, and children born on or after September 1, 2023, can receive a growth bonus of RMB 10,000 for each child on their 1st to 5th birthday.
Earlier, on June 30, Ctrip Group just announced the launch of the “Cheng 2nd Generation Cheng Chang Gift”, a maternity allowance policy for global employees. That is, starting from July 1, 2023, global employees who have been employed for three years, regardless of gender, will receive a cash allowance of 10,000 yuan per year for every new child born, which will end after the child is 5 years old. According to preliminary estimates, Ctrip plans to invest 1 billion yuan in maternity allowances in the future to motivate employees to give birth.
According to data from the National Bureau of Statistics, there were 9.56 million births in 2022, and the birth rate of the population was 6.77%. This is the first time since 1950 that the number of births per year has fallen below 10 million. Furthermore, the birth rate of China's population fell below 1% (that is, 10 per 1,000) for three consecutive years. Kang Yi, director of the National Bureau of Statistics, said that China's population declined by 850,000 in 2022, mainly due to the decline in the number of new births, which is related to the decline in the desire to have children, delays in marriage and childbearing time, etc., and also to the decline in the population of women of childbearing age. These factors have led to a decrease in the number of new births.
In recent years, from encouraging the birth of a second child, to liberalizing a third child, to adjusting the health insurance policy for children born out of wedlock, the country's continuously relaxed maternity policy has become a “new national policy.” Not only are industries such as early education, childcare, and assisted parenting, but the maternal and child consumer market, which had been thwarted a few years ago, is also gradually booming.
Deng Haiqing, deputy general manager and chief investment officer of China Aviation Fund, said recently that it is recommended to give half of the mortgage interest rate for the only house in the family with a second or third child. Because basically 80% of households have an important cost on mortgages. At the same time, families with two or three children are given a certain car purchase subsidy. In this way, young people in China will begin to evolve from being unwilling to get married and have babies in the past to a situation where they are scrambling to get married and have children, thus consolidating the potential for China's future economic growth and solving the problem of China's aging population.
CITIC Securities, on the other hand, pointed out that in the short term, it is expected that liberalizing three-child births will increase the number of newly born children by about 10%. In the medium to long term, maintaining the fertility rate within a moderate range still requires support from fertility promotion policies.
In terms of opportunity, Guolian Securities said that in recent years, in the face of the declining birth rate of newborns, “one old, one young” has become the core topic of social policy. The State has adjusted its fertility policy, gradually liberalized second and third births, improved fertility support policies, and raised society's willingness to have children. The increase in newborns will greatly increase demand throughout the mother and child industry chain, bringing investment opportunities for related industries and companies.
Related concept stocks:
Beikang Medical (02170): The only company in China that lays out the entire industry chain for assisted reproduction medical devices. In the first half of this year, the company achieved total revenue of 85.546 million yuan, an increase of 24.8% over the previous year; gross profit of 33.564 million yuan, an increase of 11.07% over the previous year.
Aidi Palace (00286): The company provides high-quality confinement services to tens of thousands of families, provides every mother and baby with scientific confinement services such as maternal and child care, physical conditioning, dietary nutrition, early education, enlightenment, and post-natal repair. It has established 9 major professional service systems, including 1,300 refined service standards, which have passed SGS service system certification.
Jinxin Reproduction (01951): Private leader in the assisted reproduction service industry. Starting July 1, 16 therapeutic assisted reproductive technology projects will be included in the scope of basic medical insurance reimbursement in Beijing. Reimbursement items include tests to promote ovulation, preferential treatment of sperm, and recovery of frozen embryos.
China Feihe (06186): UBS recently released a report stating that it maintains China's Feihe purchase rating, with a target price of HK$9.26. The report said that since the beginning of the year, Feihe has successfully increased its market share, indicating that the key measures it has implemented, such as strengthening channel control, strengthening brand building, and establishing a more diverse product portfolio, are bearing fruit. The bank expects newborns to rebound in 2024, industry demand will be relatively stable, and Feihe is expected to recover faster than its peers.