I just complete a meaningful cultural tour with family to Fujian of China, having better understanding of different dialect groups common in Singapore & Malaysia: Hokkien, Teochew, Hakka, Fuzhou (Hockchew), etc.
My grandparents came to Nanyang (Muar, Malaysia) about 100 years ago from Yong Chun (永春) of Fujian, China, to pursue a better life. Even my own parents don’t have chance to visit China. So, after travelling to many big cities globally, I have decided to visit “ulu” area of China to understand the original root of my family. 饮水思源！
The trip over 9 days, travelling over few thousands km around Fujian （福建）& Guangdong （广东） provinces, covering second / third tier cities such as Xiamen/Gulangyu （厦门/鼓浪屿）, Chaozhou/Shantou （潮州/汕头）, Meizhou （梅州）, Wuyishan （武夷山）, Yongding （永定）, Yong’an （永安）, Fuzhou （福州）, Quanzhou （泉州）, etc.
It is an eye opening for me, especially I can hear Hokkien spoken in Xiamen and changes in dialects in different cities, as well as different local signature dishes for meals. I have forgotten how many cups of tea and beer which I have drunk in the entire journey. The special show (印象大红袍) designed by Zhang YiMou is truly enjoyable with 360 degrees rotating seats around the nature.
We also visited the old house of ancestor for late Mr Lee Kuan Yew in Dapu (大埔), a museum with statue of Mr Lee is built nearby there. The tour guide could not understand why Mr Lee never really visited this place before last time. I explained to him that Mr Lee does not want people to remember him in this way, this is related to old house incident in Singapore. This makes Mr Lee “immortal” as we would remember of what he has done for Singapore, not just respecting a statue.
I was very touched when the tour guide pointed at the harbour of city which could be the same port of departure for many of our ancestors 100 years ago. Their sacrifices have given a better new life for the next generations.
Now looking back, China has been suffering over the past 100 years due to political instability. Over the past 2 decades, China joins the WTO, opening up the door to the external world, economic development is beyond imagination since then. China stock market has been falling into crisis with low optimism, many people worry on the impact of recent US-China trade war.
Here are my Personal Analysis (PA) of China stocks / economy based on observations in current trip, comparing with past experience in other China cities.
1) Consumer Stocks
China is still dependent on domestic market for consumer market, at least for smaller cities, few foreigners (non Chinese) there in smaller cities. This would help to reduce the impact of trade war with sustainable domestic consumption. Stocks with consumer staples (essential products such as food & beverages, household products, etc) are relatively more defensive due to popular support on daily basis, Consumer discretionary is suffering, shopping malls with branded premium products have few customers, especially RMB is getting weaker with declining China stock market.
China is no longer “cheap”, even with 1 SGD to 5 RMB, prices of certain products or services (eg. movie ticket, milk tea, Big Mac) is only half of Singapore or even more expensive than here. This is tremendous pressure to China local people staying in cities, high cost of living (property, spending, etc) with slower growth in salary.
2) Healthcare Stocks
China Chinese people have very different practices, eg. “aunties” could wake up 7am+ in winter to exercise qigong, then dancing as a group in the evening. China has too many people, older generation would retire earlier to give the chance of job opportunities to younger generation. Staying active is a way to remain healthy, dancing in the park or square is one of the best options.
Healthcare stocks would have brighter future due to aging population with rising in middle class, having strong spending power. Despite the new second child policy, some families are used to 1 child or no child at all (similar to Singapore experience), therefore spending on oneself could be more.
3) One-Belt One-Road Stocks
Even before One-Belt One-Road initiative, China has pumped in a few trillions of dollars since year 2008 (last global economic crisis) to build up infrastructure (highways, high speed railways, long bridges, mega buildings, etc). The spider web of connections have helped money (products & services) to flow all over the China, balancing between cities and rural areas, connecting to external world.
Compared with trip to China 20 years ago with many bicycles seen, now the scene on the road is replaced with cars everywhere, not even motorbikes, a sign of modern developing country. Highway is getting important, it is easy money for China stocks with monopoly business to collect toll fee.
Sinopec (HKEX: 0386.HK) petrol stations could be found nearly everywhere, the business fundamental is strong, better than counterpart PetroChina (HKEX: 0857.HK). Both giant stocks are the second & third largest oil & gas companies in the world, currently at low optimism in share prices. Brent crude oil price has dropped below US$60/barrel, combining with bearish China stock market, oil & gas stocks in China are heavily corrected.
=============================
Chinese people could live in any continent or city globally but each generation will have its unique root. Malaysia is root or hometown to me and my parents while Singapore is extended root for my own children as they are born and growing up here. Investment could be integrated into our daily lives, mastery of financial literacy would help us and our future generations, there is no need to migrate again due to financial reasons.
Crisis is an opportunity for giant stocks. You may learn in free 4 hours stock investment course by Dr Tee to integrate Optimism, FA (Fundamental Analysis), TA (Technical Analysis) and PA (Personal Analysis) for global giant stocks. Register Here: www.ein55.com
