Strategic Emerging Industries' Market Value Exceeds 14 Trillion Yuan

As a barometer of economic operations and an important platform for resource allocation, the capital market profoundly reflects the pulse and direction of the macroeconomy. China Fund Report specially launches the "Viewing the Macro from the Capital Market" column, striving to keenly capture the dynamics of the capital market, provide forward-looking insights into the macro trends, and grasp the internal logic and core drivers of economic operations.

In recent years, under the guidance and support of a series of national policies, China's capital market has conducted in-depth research to improve the institutional arrangements for issuance and listing, mergers and acquisitions, re-financing, and venture investment. It actively guides resource elements to accelerate aggregation towards the real economy and the field of scientific and technological innovation, strengthens services for high-level self-reliance in science and technology, and supports the growth and development of new quality productive forces, achieving positive progress.

The capital market has become one of the main positions to support the development of new quality productive forces. The Third Plenary Session of the 20th Central Committee of the Communist Party of China clearly proposed to improve the system and mechanism for developing new quality productive forces according to local conditions. As an important part of the socialist market economic system, the capital market plays a significant role in supporting and serving the development of new quality productive forces.

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Wu Bohua, General Manager of the Institutional Client Department of Changjiang Securities and Co-General Manager of the Research Institute, said that the Third Plenary Session of the 20th Central Committee of the Communist Party of China, the new "National Nine Articles," and the capital market "1+N" system are based on top-level design. Starting from strengthening regulation, preventing risks, and promoting high-quality development, they have clarified the direction for the capital market to better serve the development of new quality productive forces.

Gao Ruidong, Chief Economist of Everbright Securities and Director of the Research Institute, said that with the implementation of the new "National Nine Articles" and the capital market "1+N" policy, the capital market has become one of the main positions to support the development of new quality productive forces.

Gao Ruidong believes that the new "National Nine Articles" fully reflect the core essence of "Chinese-style modernization" in content formulation, especially in closely integrating the high-quality development of the capital market, serving national major strategies, and promoting high-quality development of the economy and society. By optimizing resource allocation and promoting scientific and technological innovation, the capital market is providing a continuous source of power for the development and growth of new quality productive forces.

Lu Zhengzheng, Chief Economist of Industrial Bank, also said that supporting the growth and development of new quality productive forces is not only an important way for the capital market to serve the real economy but also an important opportunity for the capital market to achieve high-quality development. At the same time, the increase in the "hard technology" content of the capital market is also conducive to enhancing the ability to reward investors.

The total market value of strategic emerging industries exceeds 14 trillion yuan.In the key areas where new-quality productive forces are taking shape, the capital market is guiding funds to accelerate their aggregation towards strategic emerging industries and future industry-related fields.

As of September 18, 2024, the number of listed companies related to strategic emerging industries has exceeded 1,800, accounting for about 35% of the total number of A-share listed companies; the total market value exceeds 14 trillion yuan, accounting for about 18% of the total market value of the entire A-share market.

Looking at the specific industry distribution, the six industries with the most listed companies are machinery and equipment, pharmaceuticals and biology, electronics, basic chemical industry, power equipment, and computers, most of which are related to new-quality productive forces.

Lu Zhengwei from Industrial Bank commented that in recent years, China's capital market has vigorously promoted key institutional innovations. Based on the characteristics of technology companies, development patterns, investment and financing, and incentive and restraint needs, it has targeted the enrichment of capital market tools, products, and services. The multi-layered capital market system, with its differentiated development, functional complementarity, and interconnectivity, has become more mature and more adaptable to the development needs of new-quality productive forces. The market functions are increasingly sound, and the coverage and precision of services have achieved a qualitative improvement.

Wu Bohua from Changjiang Securities also believes that strategic emerging industries are the reflection of new-quality productive forces in the stock market, and the development of the capital market is also a reflection of the transformation of economic structure. With the current transformation of China's economy towards high-quality development and the orientation of innovation breakthroughs in high-tech fields, the technology industry will undoubtedly become the main theme of the capital market.

The construction of a multi-level capital market system has also provided fertile soil for the development of new-quality productive forces, with the coverage and precision of services continuously improving.

At present, listed companies related to strategic emerging industries are mainly distributed in the ChiNext, STAR Market, and the Beijing Stock Exchange, among which, ChiNext accounts for 50%, and the STAR Market accounts for 31%, with a combined proportion as high as 81%.

In addition, from the beginning of this year to September 18, the amount of funds raised by listed companies related to strategic emerging industries through refinancing reached 21.4 billion yuan. Through financing and refinancing, the capital market has provided a continuous stream of new funds for enterprises related to new-quality productive forces and has laid the foundation for investors to share the development achievements in fields related to new-quality productive forces.

Allowing investors to fully share the growth dividends of China

The capital market is accelerating the cultivation of new-quality productive forces, and the growth potential of new-quality productive forces is gradually emerging, injecting new momentum into the capital market. As new-quality productive forces deliver performance, the capital market will also become a platform for investors to share the dividends of China's high-quality development.Gao Ruidong from Everbright Securities believes that the capital market has actively embraced the development of new quality productive forces, allowing investors to fully share the fruits of high-quality economic development in China and the dividends of the era.

Wu Bohua from Changjiang Securities also stated that new quality productive force enterprises and the capital market grow together, enabling investors to share the growth dividends of China and promote common prosperity.

Looking at the historical operating conditions, the revenue of new quality productive force listed companies has continuously reached new heights, and profits have continued to improve. Data shows that from 2018 to 2023, the compound growth rate of revenue and profits of new quality productive force enterprises was 11.26% and 9.60%, respectively, significantly exceeding the overall level of A-share listed companies.

High R&D investment is gradually becoming the source of new quality productive forces. In the first half of 2024, the proportion of R&D expenditure of the companies included in the Wind New Quality Productive Force Index to the total revenue was 7.7%, significantly higher than the overall A-share level of 5.8%.

In addition, the capital market's mergers and acquisitions, equity incentives, and other systems are evolving with the times, further adapting to the needs and characteristics of the development of new quality productive forces.

Gao Ruidong summarized that in the future, under the guidance of the new "Nine National Articles" and the "1+N" policy of the capital market, the capital market will further guide capital to gather in the field of new quality productive forces, enhance institutional inclusiveness, give full play to the function of resource allocation, support scientific and technological innovation and industrial upgrading, actively create a good market ecosystem, and gradually become the "fertile soil" for cultivating new quality productive forces, making a greater contribution to high-quality economic development.

The capital market will continue to support the development of new quality productive forces and the preservation and appreciation of residents' wealth, and there is no end to this work. With the new "Nine National Articles" and the "1+N" policy system to promote the high-quality development of the capital market accelerating the landing in April this year, the capital market will surely make a significant contribution to building a strong financial country in the new era for our country.