Liu Gesong Guangfa Small Cap Growth Quarterly Report: Stock position increased to 94.19%. Electric car stock selection focuses on market value elasticity.

On the evening of January 20, the quarterly report for 2024 of the Guangfa Small Cap Growth Hybrid Fund managed by Liu Gesong, Deputy General Manager of Guangfa Fund, was the first to be disclosed. As of the end of the fourth quarter of 2024, the net asset value of the Guangfa Small Cap Growth Hybrid Fund was 5.835 billion yuan, slightly decreasing by 831 million yuan from the end of the third quarter of 2024. It is worth mentioning that in terms of position, the stock position of the Guangfa Small Cap Growth Hybrid Fund at the end of the fourth quarter of 2024 has further increased to 94.19%, making it the third highest stock position in the history of the fund since its establishment in 2005, second only to 94.62% in the first quarter of 2022 and 94.52% at the end of the fourth quarter of 2013. In the fourth quarter of 2024, the net asset value growth rate of Class A shares of the Guangfa Small Cap Growth Hybrid Fund was -3.34%, and the net asset value growth rate of Class C shares was -3.44%, while the benchmark return rate for the same period was 3.50%. Furthermore, the top ten heavy-holding stocks of the Guangfa Small Cap Growth Hybrid Fund accounted for 67.84% of the fund's net value, which was higher than the 64.34% at the end of the third quarter of 2024, indicating an increase in the concentration of the top ten heavily held stocks. Specifically, the fourth quarter report for 2024 showed that the top ten heavy-holding stocks of the Guangfa Small Cap Growth Hybrid Fund were Chongqing Sokon Industry Group Stock (601127.SH), SG Micro Corp (300661.SZ), Ningbo Deye Technology (605117.SH), Eve Energy Co.,Ltd. (300014.SZ), JA Solar Technology (002459.SZ), Ginlong Technologies (300763.SZ), Flat Glass Group (601865.SH), Shaanxi Huaqin Technology Industry (688281.SH), China Zhenhua (000733.SZ), and Anhui Jianghuai Automobile Group Corp.,Ltd. (600418.SH). In terms of changes in holdings, JA Solar Technology and Anhui Jianghuai Automobile Group Corp., Ltd. re-entered the top ten heavily-held stocks list. Meanwhile, Liu Gesong slightly increased his holdings of China Zhenhua. On the other hand, Western Superconducting Technologies (688122.SH) and Beijing Yuanliu Hongyuan Electronic Technology (603267.SH) exited the top ten holdings. It is worth mentioning that after reducing his holdings in Chongqing Sokon Industry Group Stock, Liu Gesong increased his position in Anhui Jianghuai Automobile Group Corp., Ltd., which has now become the tenth largest holdings stock of the Guangfa Small Cap Growth Fund. The market value of Anhui Jianghuai Automobile Group Corp., Ltd. is currently less than 90 billion yuan, which is 40% of the market value of Chongqing Sokon Industry Group Stock, indicating that fund manager Liu Gesong is seeking market value growth opportunities and greater stock price elasticity in the electric vehicle sector. In his latest quarterly report, Liu Gesong emphasized that he will continue to focus on industries with global comparative advantages such as photovoltaics and industrial chains, lithium batteries, new energy vehicles, and electronics, and the fundamentals of heavily-weighted industries have shown varying degrees of reversal towards an upward trend in the fourth quarter. With the gradual implementation of macro policies and industry supply-demand regulatory policies, it is expected to see further improvements in the industry. At the same time, more economic stimulus policies are expected to be introduced, and he is confident in the strength of policy support and the growth resilience of Chinese leading enterprises. In terms of investment style, he stated that he will continue to adhere to an industry-focused approach, seeking long-term investments in industries that fit his framework of investment logic and sharing the dividends of corporate growth. In the process of economic structural transformation, growth industries such as technology manufacturing are expected to produce a number of Chinese companies with outstanding research and development capabilities and significant product strength. There is reason to believe that they will fully benefit from the development of the Chinese economy and grow robustly. Meanwhile, it is believed that in the not too distant future, China's manufacturing industry, with global comparative advantages, will overcome various challenges and embark on a new cycle.