In January 2024, the relevant person in charge of the State-owned Assets Supervision and Administration Commission (SASAC) stated for the first time that it would study the effectiveness of market value management in the assessment of the heads of central enterprises. Guide the person in charge of the central enterprise to pay more attention to and pay more attention to the market performance of the listed companies they control, and timely use market-oriented means such as increasing holdings and repurchases to convey confidence, stabilize expectations, increase cash dividends, and better return investors.
The new statement clearly emphasizes that in the future, central enterprises may further strengthen the optimal management of market value by encouraging repurchases, increasing the proportion of cash dividends, and strengthening equity incentives, which may become a key catalyst for a new round of revaluation of the value of central enterprises.
In terms of ETFs, the Central Enterprises Return ETF (561960) replicates and tracks the CSI Guoxin Central Enterprises Shareholder Return Index (hereinafter referred to as the "Shareholder Return of Central Enterprises"), which mainly covers 50 central enterprises under the SASAC with a high ratio of cash dividends or repurchases to total market capitalization.
In terms of weighting method, the index mainly adopts cash dividends and buybacks to weighting the proportion of total market capitalization to further improve the strength of dividend factors. Compared with the current mainstream broad-based index of A-shares, the shareholder return index of central enterprises has lower volatility and higher risk-return ratio.
In terms of valuation, as of January 26, the latest price-earnings ratio of the central enterprise shareholder return index was 979, which is lower than the 15 of the CSI All-Share Index39, which is also lower than the 10 of the CSI 30085。In horizontal comparison, the valuation level of the shareholder return index of central enterprises does not match its market economic status, and it is expected to usher in value reshaping with policy support.