Can the crazy “stone” break the “Moutai curse”

In the morning trading on the 16th, the stock price of Stone Technology (688169.SH) broke through the 1,000 yuan mark in one fell swoop, becoming the second 1,000 yuan stock in the A-share market after Kweichow Moutai (600519.SH). As of yesterday’s close, Stone Technology’s stock price closed at 1018.03 yuan per share, an increase of 3.96%.

Yesterday, the index continued its weakness and volatility, individual stocks fell broadly and diverged sharply, and funds continued to group large consumer sectors such as liquor and food and beverage. As of the close, the Shanghai Composite Index fell 0.01% to close at 3366.98 points; the Shenzhen Component Index fell 0.09% to close at 13751.09 points; the ChiNext Index rose 0.06% to close at 2760.64 points. The net inflow of Shanghai Stock Connect was 2.873 billion, and the net outflow of Shenzhen Stock Connect was 958 million.

According to the data, Roborock Technology was established in July 2014. It is a company focusing on the research and development and production of household intelligent cleaning robots and other cleaning appliances. The main products are Xiaomi’s customized brand Mijia sweeping robot, Mijia handheld wireless vacuum cleaner, and Xiaowa Smart Accessories for sweeping robots, Roborock intelligent sweeping robots and related products. On February 21, 2020, Stone Technology successfully landed on the Science and Technology Innovation Board of the Shanghai Stock Exchange with an issue price of RMB 271.12 per share.

Scratch head

As the company with the highest issue price of shares on the Sci-tech Innovation Board, Stone Technology’s stock price rose 85.27% on the first day of listing to close at 500.1 yuan per share. Subsequently, the company’s stock price experienced a short-term trough and once dropped to 313.11 yuan per share. On August 31 this year, the company’s stock price began to explode. In nearly three and a half months, the stock price of Stone Technology rose from 398 yuan to 1038.8 yuan. The cumulative increase has exceeded 150%.

There has always been a “Moutai curse” in the A-share market. The so-called “Moutai curse” means that once the stock price of one or more stocks exceeds Kweichow Moutai, there will be varying degrees of adjustment in the short term.

Before Stone Technology, all stocks whose stock prices were close to or surpassed Kweichow Moutai, including Anshuo Information (300380.SZ), Quantong Education (300359.SZ), Shenzhou Taiyue (300002.SZ), Haipurui (002399.SZ), China Shipbuilding (600150.SH), etc., once sat on the throne of the first high-priced A-share stock, and now they have lost their courage. However, Changchun High-tech (000661.SZ), Kanghua Bio (300841.SZ), Gigabit (603444.SH) and other stocks that have recently risen to the second position in their stock prices have all experienced varying degrees of decline.

A manager of a public offering fund in South China told a reporter from China Business News that, generally speaking, the birth of high-priced stocks has fundamental reasons, as well as individual factors, which require specific analysis of specific reasons. Judging from the current high-priced stocks in the market, they are generally companies with a relatively stable profit model, broad market prospects, and room for continuous growth. Institutions have conducted in-depth research on such stocks and are more willing to invest.

Take Kweichow Moutai in the past two years as an example. According to statistics from Orient Wealth Choice, the company’s stock doubled in 2017 and 2019. This year it has also increased by more than 50% and hit new highs many times. As of the close on the 16th, the stock price closed at 1840. Yuan/share. From a fundamental point of view, the company has strong profitability and abundant cash flow, and has never conducted additional issuance since its listing. As of the third quarterly report, among the top ten heavy stocks of public funds, Kweichow Moutai continues to sit firmly on the throne of the first heavy stocks, and the number of public funds holding this stock in the whole market is as high as 1,453.

“However, judging from the recent high-priced stocks, there are individual reasons for the birth of new stocks. There is less circulating equity in secondary new stocks, and the superimposed market demand is relatively strong, which to a certain extent boosts the stock price.” The fund manager added.

The market software shows that as of August 21, 2020, the total share capital of Stone Technology is 66,666,700 shares, and the outstanding share capital is 16,297,800 shares. From a fundamental point of view, Stone Technology began to experience explosive growth after 2017, but gradually began to decline in the following two years. From 2017 to 2019 and the first three quarters of 2020, Rock Technology’s revenue was 1.119 billion yuan, 3.051 billion yuan, 4.205 billion yuan, and 2.98 billion yuan, respectively, with changes of 510.95%, 172.72%, 37.81% and -1.66, respectively. %. The net profit attributable to the parent was 90 million yuan, 458 million yuan, 756 million yuan, and 832 million yuan respectively over the same period.

1 Response

  1. Orla says:

    Curse 3: “This year’s bonus pool growth is weak, and it will be hard to beat last year’s record” seems likely to be resolved in recent days.

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