The Zhitong Finance App learned that Guoxin Securities released a research report saying that recently, policies to boost real estate were released one after another. The property market ushered in multiple benefits, and the property market ushered in multiple benefits. It is expected to boost market confidence and drive valuation repair in the real estate chain in the short term. In the medium to long term, as demand for home purchases is released, the industry growth center may improve expectations. It is recommended to focus on the home sector, which is at the bottom of the valuation. It is recommended to focus on leading home furnishings (603833.SH), Sophia (002572.SZ), Zhibang Home (603801.SH), and Gujia Home (603816.SH), which are currently at the bottom of the valuation.

Guoxin Securities's views are as follows:

Recently, real estate has welcomed many favorable policies, which have boosted expectations.

On May 17, the central bank and other departments announced a combination of real estate policies such as lowering the down payment ratio for home purchases and interest rates on provident fund loans, abolishing the lower mortgage interest rate limit, and proposing to establish 300 billion reloans for affordable housing. After a lapse of 10 years, real estate repositories have started again. After the reduction, the mortgage down payment ratio for the first and second apartments and interest rates on provident fund loans in many places are all record lows. At the same time, the property market is expected to recover at the bottom with state-owned enterprises collecting, storing and digesting inventory.

Referring to the storage effect brought about by the previous round (2014-2016) package of real estate policies: the cumulative growth rate of residential sales immediately rebounded to the bottom after the mortgage down payment ratio was lowered on 2015/3/30. After the release of the 2015/6 monetization policy for shed reform, the cumulative growth rate of housing completion and new construction both reversed the downward trend and rebounded from September-October. The effect of the policy was immediate.

Looking back at the present, easing policies on both the supply and demand sides are also frequent in this round, which also involved lowering down payments on mortgages and easing the provident fund policy, etc., but they are already different in terms of policy strength and starting point of storage, real estate cycle, and macroeconomic environment. The effects of policy implementation may vary, and the historical path from policies activating the market to getting out of the bottom of the property market is still expected to be repeated.

Focus on home furnishing leaders that are undervalued and growing steadily.

Since the decline in real estate for three years, leading home furnishing companies have resisted the pressure of real estate and raw material disturbances and achieved steady growth through various measures such as transformation, multi-channel expansion of all categories, and cost reduction and efficiency. The recent intensive introduction of real estate policies is expected to boost market sentiment and bring about valuation repair in the real estate chain; in the medium to long term, although the real estate dividends in the home furnishing industry have subsided, the fundamentals of entering the stock housing market have not changed, and the effects of the real estate policy portfolio have yet to be seen, but the growth center of the industry may still be expected to improve under the policy drive, and leaders are accelerating integration and pattern optimization by deepening internal efforts. It is recommended to focus on Oupai Home (15.2x), Sophia (15.7x), Zhibang Home (14.0x), and Gujia Home (15.5x), which are currently at the bottom of the valuation.

Investment suggestions: As favorable real estate and consumer policies increase, I am optimistic about leading home furnishing operations and valuation restoration, focusing on Oupai Home Furnishing, Sophia, Gujia Home Furnishing, Bull Group (603195.SH), Rialter (002790.SZ); focusing on the profitability of paper making, focusing on the profitability of paper making, recommending Sun Paper (002078.SZ), and recommending the paper packaging leader Yutong Technology (002831.SZ), which continues to advance large-scale packaging strategies; it is recommended to focus on the light industry export chain sector driven by furniture replenishment logic and cross-border overseas travel Zhi Ou Technology, the leading leader in cross-border overseas travel in the household category (301376.SZ), Lego shares (300729.SZ), which led to secondary growth in the overseas warehouse business.

Risk warning: The recovery in consumption fell short of expectations; the completion of real estate sales fell short of expectations; the competitive landscape of the industry deteriorated.