CITIC International expects domestic residential property values to shrink next year, with continued consumption downgrade

Zhao Yin International Research Report indicates that it is expected that by 2026, the core of domestic residents' consumption will be "asset shrinkage + slow recovery of income expectations." In terms of assets, the concentration of new homes in first-tier cities entering the market, along with the bulk disposal of bank-related real estate assets, may push second-hand housing prices to the bottom, leading to a decrease in the value of residents' properties, which will suppress consumption willingness. On the demand side, uncertainties in foreign trade are dragging down employment income, and the "downgrade" of consumption continues, with spending tendencies leaning towards rigid demand and low-cost emotional comfort.

The bank believes that against the backdrop of ongoing uncertainties in the domestic consumption environment, companies with significant progress in globalization can expand into overseas markets to hedge against the risks of domestic demand fluctuations.

In terms of stock selection, in the food and beverage sector, the bank recommends paying attention to NONGFU SPRING (09633.HK), which benefits from categories such as juice and functional beverages, as well as CR BEVERAGE (02460.HK), which has seen a narrowing decline in market share in the packaged water segment and is currently valued at a low level. In the beauty and skincare sector, the bank suggests focusing on GIANT BIOGENE (02367.HK) and ETERNAL BEAUTY (06883.HK), which have relatively attractive valuations