The Application Of Growth Investment In Chinese Stock Market

At the time of writing this paper, the stock market turmoil intensified at home and abroad. Abroad, on the one hand, the end of QE. Reentered the interest rate channel, caused by a multinational currency depreciation, capital flight; on the other hand, for the world economic growth stagnation and the worries about deflation nightmare lingering, public commodity prices continued downward; the result is multi country stock market plummeted, safe haven demand for heating, gold soared. Domestic and under the reform expectations and loose monetary policy to stimulate, China's stock market in June July 2014 and 2015, appeared a wave of bull; after the CSRC thorough investigation with a capital of RMB devaluation pressure, error fuse mechanism to implement such reasons in less than a year of time has experienced three times the stock market crash. Many people began to question the value of the stock investment, to sing more gold. It is in the general question of the value of the stock investment, the author of this article, to promote long-term investment in the stock of the road-growth investment.In this paper, the literature review is mainly the growth of investment, the winner's curse and stock valuation theory. Growth investment originates from Philip Fisher, the summary of the 15 rules of common stocks; master is Peter Lynch, the company is divided into six types, and puts forward the 13 rules of the stock; ONeil the further development of the theory of investment growth, the can slim investment law. At home. Fan Yonghong will choose to further streamline growth stocks for the six major standards, Zhang Zhigang, Zhu Donghui proposed growth should be reflected in the growth of the stock price growth. Capen, Clapp and Campbell first proposed the "winner's Curse", Stephen A. rose et al introduced "winners curse" theory in the interpretation of "IPO underpricing", Bai, Wang Xing (2015) using "winner's Curse" theory to explain stock prices often overestimate the phenomenon. Stock valuation theory can be divided into absolute valuation method, relative valuation method and real options method. Absolute valuation method, including DDM, FCFF, FCFE, etc., the relative valuation method, including PB, PE, PEG and so on, the real option law B-S-M formula in the application of stock pricing. But the above three methods are not applicable to some of the valuation of the formula of the Internet, the financial sector introduced a number of users, the number of pages click on the valuation of the Internet Co. Hao Chen pointed out that the traditional valuation theory does not consider corporate governance factors, the market presence of governance premium.The research idea of this paper is to find out the core principles of the growth investment and apply it to the investment practice of A shares in the summary of the domestic and foreign investment ideas. In this paper, qualitative analysis and quantitative analysis methods are combined, and in the form of case to reveal the specific analysis method of growth investment. The first part of the article describes the research background, purpose and significance, domestic and foreign literature review, research ideas and methods, and innovation points and deficiencies. The second part is to analyze the concept of growth investment. The third part electrical boss kitchen electric industry analysis; the fourth part is the use of growth investment analysis framework from the analysis of quantitative factors and non-quantifiable factors analysis of two aspects to discuss whether the firm is a real growth companies. The fifth part of the use of absolute valuation method and relative valuation method for the valuation of the company's stock. The sixth part suggests investment risk. The seventh part is the conclusion of this paper.The innovation of this paper lies in:A, proposed the development of the investment philosophy of the core is the growth and persistence of the performance of the company; second, construction of a new growth investment analysis framework is a growth investment analysis for the analysis of quantitative index and quantitative index analysis; specifically, quantity indicators analysis including the five aspects of research and development, product, production, distribution and financial and non-quantitative index analysis includes five aspects of corporate governance, strategic management, brand management, business model, the core competitiveness. The deficiency of this paper lies in:one is due to the author for the home appliance industry especially high-end kitchen electric industry does not have the thorough understanding, industry analysis in some places not deep enough; the second is for the valuation of the company may there is a tendency to overestimate the value.To analyze the growth of investment philosophy must answer:first, why should choose growth stocks? Second, what are the characteristics of growth stocks? Third, can choose whether to optimize growth investment? In this paper, the author of the registration system will be introduced to put forward junk stocks do not have long-term investment value, higher risk; from the market performance of growth stocks is better than the value of shares. The core of investment growth is the performance of the company growth and sustainability and growth stocks reflect in the quantization factors and non-quantifiable factors; the quantitative factors, including research and development, product, production, distribution and financial and non-quantitative factors include five aspects of corporate governance, business strategy, brand management, business model and core competitiveness. Because of China's stock market has a spike, with the rise and fall, fueled or help feature, slump, thousands of strands of limit, no differentiation between stocks, buy and hold is not the best strategy for the operation. This paper argues that when the timing is necessary, it can optimize the growth investment philosophy.Then, this paper takes the boss appliances (002508) as an example, from the industry and the company's point of view demonstrates the growth of investment in the specific analysis method. Boss appliances belonging to the household electrical appliance industry sub industry kitchen electric industry. Kitchen electric industry and the real estate industry is highly related, the future growth of space is huge. The status quo is the growth of high-end products faster, slower growth in the low-end products, the amount of urban and rural areas to maintain a greater difference; its development trend is high-end, intelligent, environmental protection and fashion. The main barriers to entry into the kitchen electric industry are technical barriers, talent barriers, brand barriers and channel barriers. The driving factors of kitchen electric industry come from policy, income and technical factors. Future kitchen electric industry risk point lies in the macroeconomic downside risks, environmental protection and tightening of real estate policy risk and the risk of raw material price volatility.Through the quantitative factors analysis, can know the boss appliances R & D is strong; excellent product quality, the high degree of consumer acceptance; production capacity continues to rise; offline channels become more flat, high efficiency, the development of online channels quickly. Compared with the vantage shares, its financial statements is also very bright. Through the analysis of non-quantitative factors, we can know:corporate governance, ownership structure, corporate culture and succession were handled well, the concern is the management of integrity and honesty. Business strategy, company the main business focus of some investment activities such as the establishment of famous entry in the low-end market, investment "of Di Ze" into kitchen electric market for luxury goods to enhance the brand image of the company, and not to business diversification blindly into unfamiliar areas, to avoid the "multiple deterioration", I very much appreciate. In addition, the brand management company has good visibility of the company grow with each passing day. All this makes the company has three core competencies:product innovation ability, the ability to control the channel and brand management capabilities. However, before buying the stock at the decision, it necessary to reaffirm the investment risk that the problem with the growth and sustainability of the company to determine whether the. The company's sales revenue in 80% from the new home sales,20% from replacement demand. First-tier cities operating income growth has started to slow down, the future growth will mainly come from the replacement demand; second city currently operating income growth rate of 15%, the three or four line of the city is to achieve 30% growth. Therefore, the company's operating income can growth to 30% growth is the question we must consider. It is clear that the future growth of the company's power comes from the three or four line city. Company's product positioning high-end, the price is higher; its current strategy is to occupy the high-end crowd of three or four lines of the city. If the three or four line of the city for high-end kitchen electricity is not so high demand, the company is difficult to achieve a growth rate of 30%. In addition, real estate, especially the three or four line of the city growth rate continues downward, raw material prices fluctuate, industry competition intensifies, as well as the possibility of window dressing earnings may lead to investment failure.At the end of the article, give investment advice:if the company can achieve 30% growth in 2016, the corresponding share price per share at 67 yuan. The company's current stock price is 45, with a relatively safe margin. However, due to the Chinese stock market is still down, I suggest that investors should be combined with the trend, the margin of safety is higher than the following 30 buy, the operating strategy should be set a good stop and stop points.