Analysis Report: Morgan Stanley predicts that the rebound of China's Rongchuang may not be sustainable and reiterates the suggestion to buy into state-owned enterprises' domestic real estate at a low point.

Morgan Stanley released an Analysis Report on the domestic real estate industry. Despite the past week's outperformance of domestic real estate stocks compared to state-owned enterprises, it is believed that the main reason is the strong performance of Sunac China, a company in distress. However, the bank believes that this trend is not sustainable, as there is no fundamental improvement in the underlying fundamentals of the relevant companies. Sunac China is currently valued at a forecasted P/B ratio of 0.4 times, which is almost on par with the valuation level of state-owned domestic real estate stocks. The bank considers this situation to be unreasonable.