The analyst rating from JPMorgan is influenced by several factors:
1. Positive Sentiment: There is a strong positive sentiment in the market driven by developments in commercial aerospace and space solar power, which has led to significant increases in the share prices of MINGYANG SMART ENERGY and GOLDWIND.
2. Focus on Strong Earnings Growth: JPMorgan recommends investors to focus on companies with strong earnings growth prospects, specifically highlighting ORIENT WIRES & CABLES, DAQO New Energy, and GCL TECH.
3. Surge in Energy Storage Capacity: The substantial year-over-year increase in China's installed capacity of energy storage systems (73%) is expected to benefit companies like SUNGROW POWER due to policy reforms and rising demand.
4. Cautious View on Gas Utilities: The broker maintains a cautious outlook on China's gas utilities sector, citing weak industrial gas volume growth, limited profit margin improvements, and a decline in new connections. KUNLUN ENERGY is noted as the top pick in this sector due to its active engagement in capital recovery.
5. Concerns about CHINA RES GAS: JPMorgan expresses caution regarding CHINA RES GAS due to slow progress in share buybacks and weak operating trends.
Overall, the recommendations are based on market trends, company performance potential, and sector-specific challenges.
