China Top-down housing easing underway, though funding and implementation remain the keypdf
China Top-down housing easing underway, though funding and implementation remain the keypdf
Page 1 of 8
Tyler Durden shared this file. Want to do more with it?
  1. Bottom line:Chinese policymakers unveiled a fresh batch of easing measures for the housingmarket today (17 May), including clear top-down guidance for local governments topurchase existing housing inventory for public housing provision, an RMB300bnrelending quota for destocking the housing market, reductions in downpaymentratios and mortgage rates, and more policy support to secure the delivery of pre-soldhomes. We believe local government purchase of existing housing inventory, ifimplemented at scale, can help stabilize home sales, prices and completions, but theboost to new starts and land purchase would be limited. Lower downpayment ratiosand mortgage rates may also boost home sales to some degree, although themagnitude of downpayment ratio reductions was relatively small this time, and thepace of cuts to effective mortgage rates could be somewhat constrained by banknet interest margins. We expect more housing easing efforts down the road —especially on the demand-side — and view funding and implementation as key forthe effectiveness of any property market rescue plan. Besides the RMB300bnrelending quota, we believe PBOC’s pledged supplementary lending (PSL), localgovernment special bonds (LGSB), policy bank bonds and commercial bank loanscould be potential funding sources for housing destocking. Upcoming policy eventswill be worth monitoring closely, especially on solutions to address funding andimplementation bottlenecks.Main points:1. What’s new today? Following the April Politburo meeting, Chinese policymakershave significantly stepped up their easing efforts to help stabilize the property sector,on both funding and policy solutions. There were a batch of fresh housing easingmeasures unveiled today (17 May): nAt a video conference today on securing home completions, Vice Premier HeLifeng required to clearly understand the people nature (“人民性”) and politicalnature (“政治性”) of real estate work, and called for more forceful policymeasures to secure the delivery of pre-sold homes and digest unsoldcommodity housing. He specifically mentioned that for cities with high housinginventory, local governments can purchase part of commodity housing to convertinto public housing, based on the local situation and at reasonable prices. Herequired continued policy efforts on the risk disposal of property developer debt,and the “Three Major Projects” for the property sector (i.e., urban villageLisheng Wang+852-3966-4004 |lisheng.wang@gs.comGoldman Sachs (Asia) L.L.C.Hui Shan+852-2978-6634 | hui.shan@gs.comGoldman Sachs (Asia) L.L.C.Xinquan Chen+852-2978-2418 |xinquan.chen@gs.comGoldman Sachs (Asia) L.L.C.Yuting Yang+852-2978-7283 |yuting.y.yang@gs.comGoldman Sachs (Asia) L.L.C.Andrew Tilton+852-2978-1802 | andrew.tilton@gs.comGoldman Sachs (Asia) L.L.C.China: Top-down housing easing underway, though funding andimplementation remain the key18 May 2024 | 12:11AM HKTInvestors should consider this report as only a single factor in making their investment decision. For Reg ACcertification and other important disclosures, see the Disclosure Appendix, or go towww.gs.com/research/hedge.html.
  2. renovation, public housing provision, and emergency public facilities). nAt the State Council press conference this afternoon, a PBOC spokesmanannounced an RMB300bn relending program to support local government purchaseof existing housing inventory and converting into public housing (“保障性住房再贷款”). The relending interest rate will be set at 1.75%, and the tenor will be 1yr, eligiblefor rolling over four times if necessary. As banks will receive relending fundsamounting to 60% of the principal of their loans to qualified projects, PBOC expectsthe RMB300bn relending quota to support RMB500bn in bank lending for housingdestocking. On the implementation, PBOC highlighted that local governmentsshould appoint local SOEs as agents to purchase housing inventory, but theseagents should not engage in local government implicit debt (LGFVs are notqualified). Housing inventory purchase eligible for the relending support should becompleted but unsold commodity housing, per the PBOC’s requirement.nAccording to the PBOC’s announcements released today, the nationwide floor formortgage interest rates will be removed, implying local governments have morediscretion to lower their local effective mortgage rates if needed.1 If there is anymajor change in the supply-demand dynamics of the property market, PBOC wouldconsider resuming the nationwide floor for mortgage rates. PBOC also lowered theminimum down-payment ratio by 5pp, to 15% for first-time buyers and to 25% forsecond-home buyers. Housing provident fund loan rates will also be lowered by25bp, effective 18 May. nNational Financial Regulatory Administration (NFRA) pledged to support propertyprojects in the “whitelist” through both new loan issuance and existing loanextensions, with due risk management. Ministry of Housing and Urban-RuralDevelopment (MOHURD) required local governments to push forward theimplementation of “whitelist” projects, and commercial banks to increase lending tothese projects. 2. Why now? Despite the previous round of housing easing measures, propertyheadwinds are still strong: new home sales have remained around 30% below year-agolevels in recent months (Exhibit 1), housing inventory has stayed elevated, secondaryhome prices declined further in April (Exhibit 2), and some private developers (e.g.,Vanke, Agile) continue to face challenging funding conditions. Recent developmentssuggest to us that the prolonged property sector weakness has likely breachedpolicymakers’ pain threshold, pushing them to step up housing easing and to shift thestrategic focus towards digesting existing housing inventory.1Previously the minimum mortgage rate was loan prime rate (LPR) - 20bp for first-home buyers, and LPR +20bp for second-home buyers.18 May 20242Goldman SachsChina
  3. 3. What’s the likely impact? We believe local government purchase of existing housinginventory, if implemented at scale, can help stabilize home sales, prices and housingconsumer sentiment, improve property developers funding conditions to some degree,and thus facilitate home completions and property sector rebalancing. However, theboost to new starts and investment will likely be limited, as property developers’funding conditions may remain tight, given falling new home sales, potential pricediscounts during local government housing purchases, and the policy priority onensuring completions (implying less funding for land purchases and new starts). Lowerdownpayment ratios and mortgage rates may also boost home sales to some degree(our previous study suggests a 10pp cut to downpayment ratio raises sales by around7%), although the magnitude of downpayment ratio reductions was relatively small thistime, and the pace of cuts to effective mortgage rates could be somewhat constrainedby bank net interest margins (NIM). Furthermore, though it’s crucial to preventsignificant risk spillovers from the property sector to the banking sector and the realeconomy, policymakers appear to have no intention to turn the sector from a growthdrag to a driver, given the shift in their policy focus towards high-quality growth. PBOC’shighlight on a potential exit mechanism for the effective mortgage rate cuts underpinsthis view. 4. Examples from recent local pilot programs. While some cities (e.g., Chongqing,Jinan) have already experimented pilot programs to clear excess housing inventory withthe help of state funding, the amount of previous purchase was at a very small scale.Recent pilot programs, including in Lin’an district of Hangzhou city, indicate localgovernments appear more willing to purchase small and medium-sized housing unitswith little completion risk at lower-than-average prices, and mostly in large cities (withnet population inflows). Specifically, Lin’an district announced that the total floor spaceto be purchased this round will be capped at 10,000 sqm; housing units eligible for thepurchase include completed housing and uncompleted ones able to be delivered in oneyear, with floor space no higher than 70 sqm per unit; the purchase price will not exceedcomparable market rates; it would purchase housing units and car parking spots on anExhibit 1: 30-city daily property transaction volume in the primarymarket has been significantly below year-ago level in recentmonthsExhibit 2: Secondary home prices continued to decline in April0200400600800100002004006008001000Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec30-city average daily property transaction volume in the primary market201920232024May 16: -29.1% yoy**Percentage change relative to 2023Thousand sqm, 7-day moving avg Thousand sqm, 7-day moving avg909510010511011512012590951001051101151201252019 2020 2021 2022 2023 2024Property price measures for the secondary marketCentaline 6-cityBeike 25-cityZhuge 100-cityGuoxindaIndex (Jan 2019=100) Index (Jan 2019=100)Source: Wind, Goldman Sachs Global Investment ResearchSome third-party data vendors suspended their data release in previous months.Source: Centaline, Beike, Zhuge, Wind, Data compiled by Goldman Sachs Global InvestmentResearch18 May 20243Goldman SachsChina
  4. entire building basis. 5. What to watch next? We expect more housing easing efforts down the road —especially on the demand side — and view funding and implementation as key for theeffectiveness of the property rescue plan. On the funding, our recent analysis suggestsany game-changing housing easing measures (including those for housing destocking)would likely require significantly more funding than available thus far, while many inlandlocal governments remain financially stretched after the three years of zero-Covid policyand amid the prolonged property downturn. We believe this will require a largertop-down funding scheme from the central government, beyond the RMB300bnrelending quota. Moreover, strengthened fiscal discipline and financial regulation maydampen some officials’ incentives for more concerted and forceful policy efforts.Upcoming policy events — such as the July Politburo meeting, the Third Plenum, and adhoc meetings/announcements by major authorities (e.g., the State Council, NDRC, MOF,MOHURD, PBOC, SASAC)2 — will be worth monitoring closely, especially on solutionsto address funding and implementation bottlenecks (Exhibit 3).6. Other potential funding sources. Besides the RMB300bn relending quota, webelieve PBOC’s pledged supplementary lending (PSL), local government special bonds(LGSB), policy bank bonds and commercial bank loans could be potential fundingsources for housing destocking:nPSL is designated to fund property-related stimulus packages, including thelarge-scale shantytown renovation during 2015-18, and the “Three Major Projects”for the property sector most recently. In our baseline, we assume PSL net issuancewill rise to RMB700bn in 2024 from RMB99bn in 2023 (Exhibit 4), while we seesome uncertainties if policymakers prefer to use more relending (funding costs at1.75% pa) relative to PSL (2.25%) to fund housing destocking. nLGSB was a funding source for shantytown renovation and land reserves in 2018-19,although there was a temporary ban on LGSB proceeds spending in these areas inlate 2019 and early 2020. Based on our tracking, local governments have only used~RMB900bn out of the RMB3.9tn full-year LGSB issuance quota so far this year (asof late May), much slower than previous years. This implies an RMB3tn quotaavailable for the remainder of this year, part of which could be used for supportingthe ongoing housing easing package. In early 2024, policymakers allowed LGSBproceeds to be used as equity capital to fund public housing related projects, whichsuggests a likely larger multiplier effect if implemented well. nPolicy banks were major players in the 2015-18 PSL-backed shantytown renovation,and in theory they have no explicit constraint for external financing. Hence, morepolicy bank bond issuance and related lending could be possible. nCommercial banks, especially the large ones, may also provide more fundingsupport if needed. nMoreover, we see a possibility for the PBOC to increase the relending quota for2NDRC: National Development and Reform Commission; MOF: Ministry of Finance; MOHURD: Ministry ofHousing and Urban-Rural Development; PBOC: People’s Bank of China; SASAC: State-owned AssetsSupervision and Administration Commission.18 May 20244Goldman SachsChina
  5. housing destocking if needed. By comparison, the ongoing issuance of ultra-long-term central government specialbonds (ULT CGSB; 超长期特别国债), which are designated for funding key projects instrategically important areas (e.g., high-tech manufacturing), may not be a financing toolcustomized for the property sector.3 That said, purchasing housing inventory well belowmarket prices and requiring banks to increase lending to projects launched by sometroubled POEs could lead to increased burden for banks, which in turn could require thegovernment to enhance support to the banking system. 3Recent policy communications suggest the property sector is systemically important to the Chineseeconomy, but it appears its not a strategically important focus for policymakers.Exhibit 3: Upcoming key macro events related to China marketsExhibit 4: PSL could be a potential funding source for housingdestockingDate EventsJul 2024 (dates uncertain)3rd Plenum of the 20th Central Committee of the CCPEnd-Jul 2024 Politburo meeting on economic policiesSummer 2024 (possible)Beidaihe meeting1 Oct 2024 The 75th anniversary of the founding of PRC5 Nov 2024 US presidential electionEarly to mid-Dec 2024Politburo meeting on economic policiesMid to late Dec 2024 Central Economic Work Conference-4-3-2-1012345-400-300-200-100010020030040050014 15 16 17 18 19 20 21 22 23 24RMB bnRMB tnPSL: Net injection vs outstanding amountNet injectionOutstanding (RHS)Source: Government websites, Data compiled by Goldman Sachs Global Investment ResearchSource: PBOC, Wind, Data compiled by Goldman Sachs Global Investment Research18 May 20245Goldman SachsChina
  6. Disclosure AppendixReg ACWe, Lisheng Wang, Hui Shan, Xinquan Chen, Yuting Yang and Andrew Tilton, hereby certify that all of the views expressed in this report accuratelyreflect our personal views, which have not been influenced by considerations of the firm’s business or client relationships.Unless otherwise stated, the individuals listed on the cover page of this report are analysts in Goldman Sachs’ Global Investment Research division.DisclosuresRegulatory disclosuresDisclosures required by United States laws and regulationsSee company-specific regulatory disclosures above for any of the following disclosures required as to companies referred to in this report: manager orco-manager in a pending transaction; 1% or other ownership; compensation for certain services; types of client relationships; managed/co-managedpublic offerings in prior periods; directorships; for equity securities, market making and/or specialist role. Goldman Sachs trades or may trade as aprincipal in debt securities (or in related derivatives) of issuers discussed in this report. The following are additional required disclosures: Ownership and material conflicts of interest: Goldman Sachs policy prohibits its analysts,professionals reporting to analysts and members of their households from owning securities of any company in the analyst’s area of coverage.Analyst compensation: Analysts are paid in part based on the profitability of Goldman Sachs, which includes investment banking revenues. Analystas officer or director: Goldman Sachs policy generally prohibits its analysts, persons reporting to analysts or members of their households fromserving as an officer, director or advisor of any company in the analyst’s area of coverage. Non-U.S. Analysts: Non-U.S. analysts may not beassociated persons of Goldman Sachs & Co. LLC and therefore may not be subject to FINRA Rule 2241 or FINRA Rule 2242 restrictions oncommunications with subject company, public appearances and trading securities held by the analysts. Additional disclosures required under the laws and regulations of jurisdictions other than the United StatesThe following disclosures are those required by the jurisdiction indicated, except to the extent already made above pursuant to United States laws andregulations. Australia: Goldman Sachs Australia Pty Ltd and its affiliates are not authorised deposit-taking institutions (as that term is defined in theBanking Act 1959 (Cth)) in Australia and do not provide banking services, nor carry on a banking business, in Australia. This research, and any access toit, is intended only for “wholesale clients” within the meaning of the Australian Corporations Act, unless otherwise agreed by Goldman Sachs. Inproducing research reports, members of Global Investment Research of Goldman Sachs Australia may attend site visits and other meetings hosted bythe companies and other entities which are the subject of its research reports. In some instances the costs of such site visits or meetings may be metin part or in whole by the issuers concerned if Goldman Sachs Australia considers it is appropriate and reasonable in the specific circumstances relatingto the site visit or meeting. To the extent that the contents of this document contains any financial product advice, it is general advice only and hasbeen prepared by Goldman Sachs without taking into account a client’s objectives, financial situation or needs. A client should, before acting on anysuch advice, consider the appropriateness of the advice having regard to the client’s own objectives, financial situation and needs. A copy of certainGoldman Sachs Australia and New Zealand disclosure of interests and a copy of Goldman Sachs’ Australian Sell-Side Research Independence PolicyStatement are available at: https://www.goldmansachs.com/disclosures/australia-new-zealand/index.html. Brazil: Disclosure information in relation toCVM Resolution n. 20 is available at https://www.gs.com/worldwide/brazil/area/gir/index.html. Where applicable, the Brazil-registered analyst primarilyresponsible for the content of this research report, as defined in Article 20 of CVM Resolution n. 20, is the first author named at the beginning of thisreport, unless indicated otherwise at the end of the text. Canada: This information is being provided to you for information purposes only and is not,and under no circumstances should be construed as, an advertisement, offering or solicitation by Goldman Sachs & Co. LLC for purchasers ofsecurities in Canada to trade in any Canadian security. Goldman Sachs & Co. LLC is not registered as a dealer in any jurisdiction in Canada underapplicable Canadian securities laws and generally is not permitted to trade in Canadian securities and may be prohibited from selling certain securitiesand products in certain jurisdictions in Canada. If you wish to trade in any Canadian securities or other products in Canada please contact GoldmanSachs Canada Inc., an affiliate of The Goldman Sachs Group Inc., or another registered Canadian dealer. Hong Kong: Further information on thesecurities of covered companies referred to in this research may be obtained on request from Goldman Sachs (Asia) L.L.C. India: Further informationon the subject company or companies referred to in this research may be obtained from Goldman Sachs (India) Securities Private Limited, ResearchAnalyst - SEBI Registration Number INH000001493, 951-A, Rational House, Appasaheb Marathe Marg, Prabhadevi, Mumbai 400 025, India, CorporateIdentity Number U74140MH2006FTC160634, Phone +91 22 6616 9000, Fax +91 22 6616 9001. Goldman Sachs may beneficially own 1% or more ofthe securities (as such term is defined in clause 2 (h) the Indian Securities Contracts (Regulation) Act, 1956) of the subject company or companiesreferred to in this research report. Investment in securities market are subject to market risks. Read all the related documents carefully beforeinvesting. Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance ofreturns to investors. Goldman Sachs (India) Securities Private Limited Investor Grievance E-mail: india-client-support@gs.com. Compliance Officer: AnilRajput |Tel: + 91 22 6616 9000 | Email: anil.m.rajput@gs.com. Japan: See below. Korea: This research, and any access to it, is intended only for“professional investors” within the meaning of the Financial Services and Capital Markets Act, unless otherwise agreed by Goldman Sachs. Furtherinformation on the subject company or companies referred to in this research may be obtained from Goldman Sachs (Asia) L.L.C., Seoul Branch. NewZealand: Goldman Sachs New Zealand Limited and its affiliates are neither “registered banks” nor “deposit takers” (as defined in the Reserve Bank ofNew Zealand Act 1989) in New Zealand. This research, and any access to it, is intended for “wholesale clients” (as defined in the Financial Advisers Act2008) unless otherwise agreed by Goldman Sachs. A copy of certain Goldman Sachs Australia and New Zealand disclosure of interests is available at:https://www.goldmansachs.com/disclosures/australia-new-zealand/index.html. Russia: Research reports distributed in the Russian Federation are notadvertising as defined in the Russian legislation, but are information and analysis not having product promotion as their main purpose and do notprovide appraisal within the meaning of the Russian legislation on appraisal activity. Research reports do not constitute a personalized investmentrecommendation as defined in Russian laws and regulations, are not addressed to a specific client, and are prepared without analyzing the financialcircumstances, investment profiles or risk profiles of clients. Goldman Sachs assumes no responsibility for any investment decisions that may be takenby a client or any other person based on this research report. Singapore: Goldman Sachs (Singapore) Pte. (Company Number: 198602165W), which isregulated by the Monetary Authority of Singapore, accepts legal responsibility for this research, and should be contacted with respect to any mattersarising from, or in connection with, this research. Taiwan: This material is for reference only and must not be reprinted without permission. Investorsshould carefully consider their own investment risk. Investment results are the responsibility of the individual investor. United Kingdom: Persons whowould be categorized as retail clients in the United Kingdom, as such term is defined in the rules of the Financial Conduct Authority, should read thisresearch in conjunction with prior Goldman Sachs research on the covered companies referred to herein and should refer to the risk warnings that havebeen sent to them by Goldman Sachs International. A copy of these risks warnings, and a glossary of certain financial terms used in this report, areavailable from Goldman Sachs International on request. European Union and United Kingdom: Disclosure information in relation to Article 6 (2) of the European Commission Delegated Regulation (EU)(2016/958) supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council (including as that Delegated Regulation is18 May 20246Goldman SachsChina
  7. implemented into United Kingdom domestic law and regulation following the United Kingdom’s departure from the European Union and the EuropeanEconomic Area) with regard to regulatory technical standards for the technical arrangements for objective presentation of investmentrecommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications ofconflicts of interest is available at https://www.gs.com/disclosures/europeanpolicy.html which states the European Policy for Managing Conflicts ofInterest in Connection with Investment Research. Japan: Goldman Sachs Japan Co., Ltd. is a Financial Instrument Dealer registered with the Kanto Financial Bureau under registration number Kinsho69, and a member of Japan Securities Dealers Association, Financial Futures Association of Japan Type II Financial Instruments Firms Association, TheInvestment Trusts Association, Japan, and Japan Investment Advisers Association. Sales and purchase of equities are subject to commissionpre-determined with clients plus consumption tax. See company-specific disclosures as to any applicable disclosures required by Japanese stockexchanges, the Japanese Securities Dealers Association or the Japanese Securities Finance Company. Global product; distributing entitiesGoldman Sachs Global Investment Research produces and distributes research products for clients of Goldman Sachs on a global basis. Analysts basedin Goldman Sachs offices around the world produce research on industries and companies, and research on macroeconomics, currencies, commoditiesand portfolio strategy. This research is disseminated in Australia by Goldman Sachs Australia Pty Ltd (ABN 21 006 797 897); in Brazil by Goldman Sachsdo Brasil Corretora de Títulos e Valores Mobiliários S.A.; Public Communication Channel Goldman Sachs Brazil: 0800 727 5764 and / orcontatogoldmanbrasil@gs.com. Available Weekdays (except holidays), from 9am to 6pm. Canal de Comunicação com o Público Goldman Sachs Brasil:0800 727 5764 e/ou contatogoldmanbrasil@gs.com. Horário de funcionamento: segunda-feira à sexta-feira (exceto feriados), das 9h às 18h; in Canadaby Goldman Sachs & Co. LLC; in Hong Kong by Goldman Sachs (Asia) L.L.C.; in India by Goldman Sachs (India) Securities Private Ltd.; in Japan byGoldman Sachs Japan Co., Ltd.; in the Republic of Korea by Goldman Sachs (Asia) L.L.C., Seoul Branch; in New Zealand by Goldman Sachs NewZealand Limited; in Russia by OOO Goldman Sachs; in Singapore by Goldman Sachs (Singapore) Pte. (Company Number: 198602165W); and in theUnited States of America by Goldman Sachs & Co. LLC. Goldman Sachs International has approved this research in connection with its distribution inthe United Kingdom. Goldman Sachs International (“GSI”), authorised by the Prudential Regulation Authority (“PRA”) and regulated by the Financial Conduct Authority(“FCA”) and the PRA, has approved this research in connection with its distribution in the United Kingdom.European Economic Area: GSI, authorised by the PRA and regulated by the FCA and the PRA, disseminates research in the following jurisdictionswithin the European Economic Area: the Grand Duchy of Luxembourg, Italy, the Kingdom of Belgium, the Kingdom of Denmark, the Kingdom ofNorway, the Republic of Finland and the Republic of Ireland; GSI - Succursale de Paris (Paris branch) which is authorised by the French Autorité decontrôle prudentiel et de resolution (“ACPR”) and regulated by the Autorité de contrôle prudentiel et de resolution and the Autorité des marchesfinanciers (“AMF”) disseminates research in France; GSI - Sucursal en España (Madrid branch) authorized in Spain by the Comisión Nacional delMercado de Valores disseminates research in the Kingdom of Spain; GSI - Sweden Bankfilial (Stockholm branch) is authorized by the SFSA as a “thirdcountry branch” in accordance with Chapter 4, Section 4 of the Swedish Securities and Market Act (Sw. lag (2007:528) om värdepappersmarknaden)disseminates research in the Kingdom of Sweden; Goldman Sachs Bank Europe SE (“GSBE”) is a credit institution incorporated in Germany and, withinthe Single Supervisory Mechanism, subject to direct prudential supervision by the European Central Bank and in other respects supervised by GermanFederal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin) and Deutsche Bundesbank and disseminates researchin the Federal Republic of Germany and those jurisdictions within the European Economic Area where GSI is not authorised to disseminate researchand additionally, GSBE, Copenhagen Branch filial af GSBE, Tyskland, supervised by the Danish Financial Authority disseminates research in the Kingdomof Denmark; GSBE - Sucursal en España (Madrid branch) subject (to a limited extent) to local supervision by the Bank of Spain disseminates research inthe Kingdom of Spain; GSBE - Succursale Italia (Milan branch) to the relevant applicable extent, subject to local supervision by the Bank of Italy (Bancad’Italia) and the Italian Companies and Exchange Commission (Commissione Nazionale per le Società e la Borsa “Consob”) disseminates research inItaly; GSBE - Succursale de Paris (Paris branch), supervised by the AMF and by the ACPR disseminates research in France; and GSBE - SwedenBankfilial (Stockholm branch), to a limited extent, subject to local supervision by the Swedish Financial Supervisory Authority (Finansinpektionen)disseminates research in the Kingdom of Sweden. General disclosuresThis research is for our clients only. Other than disclosures relating to Goldman Sachs, this research is based on current public information that weconsider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates andforecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research asappropriate, but various regulations may prevent us from doing so. Other than certain industry reports published on a periodic basis, the large majorityof reports are published at irregular intervals as appropriate in the analyst’s judgment.Goldman Sachs conducts a global full-service, integrated investment banking, investment management, and brokerage business. We have investmentbanking and other business relationships with a substantial percentage of the companies covered by Global Investment Research. Goldman Sachs &Co. LLC, the United States broker dealer, is a member of SIPC (https://www.sipc.org). Our salespeople, traders, and other professionals may provide oral or written market commentary or trading strategies to our clients and principaltrading desks that reflect opinions that are contrary to the opinions expressed in this research. Our asset management area, principal trading desks andinvesting businesses may make investment decisions that are inconsistent with the recommendations or views expressed in this research.We and our affiliates, officers, directors, and employees will from time to time have long or short positions in, act as principal in, and buy or sell, thesecurities or derivatives, if any, referred to in this research, unless otherwise prohibited by regulation or Goldman Sachs policy. The views attributed to third party presenters at Goldman Sachs arranged conferences, including individuals from other parts of Goldman Sachs, do notnecessarily reflect those of Global Investment Research and are not an official view of Goldman Sachs.Any third party referenced herein, including any salespeople, traders and other professionals or members of their household, may have positions in theproducts mentioned that are inconsistent with the views expressed by analysts named in this report.This research is focused on investment themes across markets, industries and sectors. It does not attempt to distinguish between the prospects orperformance of, or provide analysis of, individual companies within any industry or sector we describe.Any trading recommendation in this research relating to an equity or credit security or securities within an industry or sector is reflective of theinvestment theme being discussed and is not a recommendation of any such security in isolation.This research is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would beillegal. It does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs ofindividual clients. Clients should consider whether any advice or recommendation in this research is suitable for their particular circumstances and, ifappropriate, seek professional advice, including tax advice. The price and value of investments referred to in this research and the income from themmay fluctuate. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur.Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments. 18 May 20247Goldman SachsChina
  8. Certain transactions, including those involving futures, options, and other derivatives, give rise to substantial risk and are not suitable for all investors.Investors should review current options and futures disclosure documents which are available from Goldman Sachs sales representatives or athttps://www.theocc.com/about/publications/character-risks.jsp andhttps://www.fiadocumentation.org/fia/regulatory-disclosures_1/fia-uniform-futures-and-options-on-futures-risk-disclosures-booklet-pdf-version-2018.Transaction costs may be significant in option strategies calling for multiple purchase and sales of options such as spreads. Supporting documentationwill be supplied upon request. Differing Levels of Service provided by Global Investment Research: The level and types of services provided to you by Goldman Sachs GlobalInvestment Research may vary as compared to that provided to internal and other external clients of GS, depending on various factors including yourindividual preferences as to the frequency and manner of receiving communication, your risk profile and investment focus and perspective (e.g.,marketwide, sector specific, long term, short term), the size and scope of your overall client relationship with GS, and legal and regulatory constraints.As an example, certain clients may request to receive notifications when research on specific securities is published, and certain clients may requestthat specific data underlying analysts’ fundamental analysis available on our internal client websites be delivered to them electronically through datafeeds or otherwise. No change to an analyst’s fundamental research views (e.g., ratings, price targets, or material changes to earnings estimates forequity securities), will be communicated to any client prior to inclusion of such information in a research report broadly disseminated through electronicpublication to our internal client websites or through other means, as necessary, to all clients who are entitled to receive such reports.All research reports are disseminated and available to all clients simultaneously through electronic publication to our internal client websites. Not allresearch content is redistributed to our clients or available to third-party aggregators, nor is Goldman Sachs responsible for the redistribution of ourresearch by third party aggregators. For research, models or other data related to one or more securities, markets or asset classes (including relatedservices) that may be available to you, please contact your GS representative or go to https://research.gs.com.Disclosure information is also available at https://www.gs.com/research/hedge.html or from Research Compliance, 200 West Street, New York, NY10282.© 2024 Goldman Sachs.You are permitted to store, display, analyze, modify, reformat, and print the information made available to you via this service only for your own use.You may not resell or reverse engineer this information to calculate or develop any index for disclosure and/or marketing or create any other derivativeworks or commercial product(s), data or offering(s) without the express written consent of Goldman Sachs. You are not permitted to publish, transmit,or otherwise reproduce this information, in whole or in part, in any format to any third party without the express written consent of Goldman Sachs.This foregoing restriction includes, without limitation, using, extracting, downloading or retrieving this information, in whole or in part, to train orfinetune a third-party machine learning or artificial intelligence system, or to provide or reproduce this information, in whole or in part, as a prompt orinput to any such system. 18 May 20248Goldman SachsChina
We use cookies to provide, improve, protect and promote our services. Visit our Privacy Policy and Privacy Policy FAQs to learn more. You can manage your personal preferences, including your ‘Do not sell or share my personal data to third parties’ setting using the “Customize cookies” button below.