"The 'valuation boosting' phase is over? Gu Xinfeng of ChinaAMC boldly speaks out in the Q4 report."
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After three years of adjustments in growth stocks, 2025 has become a year for many actively managed equity funds to reassess their positioning. Valuation recovery is no longer the main theme; performance delivery has returned to center stage.
Hua Xia Core Manufacturing’s 2025 fourth quarter report happens to appear at this turning point.
This is not only a stage achievement summary, but also the fund manager’s first complete quarterly report since taking over the product. Compared to short-term price fluctuations, what is more noteworthy in this report is its judgment on the position of growth stocks, and how to translate this into concrete holdings and operational discipline.
Fund Manager Takeover Timing
The Fourth Quarter Report of Hua Xia Core Manufacturing Hybrid Fund in 2025 comes with an unavoidable background change.
The fund manager, Gu Xinfeng, started managing Hua Xia Core Manufacturing on December 23, 2024. The fourth quarter report is his first complete quarterly report as the official manager.
Looking at his background, Gu Xinfeng joined Hua Xia Fund in July 2012, starting as a researcher, then serving in various roles in Hua Xia Capital, the New Third Board business unit, Equity Investment department, covering research, investment, and management across multiple areas.
Since June 2020, he began independently managing public funds, took over Hua Xia Core Manufacturing at the end of 2024, and currently manages a total fund size of about 5.6 billion yuan. From an investor's perspective, he is a typical fund manager with a research background, not one famous for a single style label.
This determines that this quarterly report is more of a concentrated display of methodology and framework, rather than an emotional expression focused on short-term performance.
Heavy Position Stock Structure, Clear Core Manufacturing Theme
Judging from the top ten positions disclosed in the quarterly report, the configuration of this fund is highly consistent.
The top ten holdings are Geely Automobile, Zhongji Xuchuang, CATL, SmartSens, Tencent Holdings, Kedali, Luxshare Precision, Naxin Microelectronics, and Swaypu.
From an industry distribution perspective, the core features of the portfolio are quite clear.
First, it is highly focused on core manufacturing. Whether it's semiconductor-related SmartSens, Naxin Microelectronics, Swaypu, or manufacturing supply chain companies like Luxshare Precision, Kedali, all belong to key links in manufacturing.
Second, the industrial chain attributes are obvious. Complete vehicles, components, upstream materials, and equipment together construct a multi-point layout around automobiles, semiconductors, and electronic hardware, rather than a concentrated bet on a single track.
Third, the concentration is not low but still diversified. The top ten holdings account for about half of the portfolio, but the highest single position is about 9.73%, so there is no extreme stock concentration. Such a structure is more like a portfolio oriented around a direction, with diversification among individual stocks.
It is worth noting that Hong Kong stocks are already represented among the top ten, with Tencent Holdings and Geely Automobile as Hong Kong-listed companies.
From an investment frontline perspective, such a portfolio does not pursue short-term explosive power, but emphasizes the integrity and trackability of industry direction.
Position of the Growth Sector
The fund manager first assesses the long-term position of growth sectors in the quarterly report.
From the 2021 peak to the 2024 trough, for the growth segment, about three years of continuous decline has left the market in a combined state of valuation bottom, sentiment bottom, and earnings expectation bottom. Many quality stocks are being sold at a “discount” compared to the 2021 peak, and many stocks that investors used to look up to for their valuations have entered a “fair price” mode.
From a medium- to long-term perspective, the period from the 2024 low to the present remains a favorable window to gradually increase positions in growth stocks. Though this process requires patience, and will be accompanied by fluctuations.
The key point of this judgment is that the fund manager does not believe that growth stocks have entered a smooth, unilateral uptrend, but are in a phase that requires patient participation and gradual recovery.
Market Changes After Rapid Rise
After confirming the medium- to long-term direction, the fund manager further discusses short-term market changes.
Indeed, after the end of last September, with unexpectedly strong stimulus policies, the market saw a dramatic upward breakout. On one hand, this shows the long wait was worthwhile; on the other, after the rise in late September and early October last year, many stocks quickly recovered, but with no substantial change in their fundamentals, after this rapid rise they entered a consolidation phase. Many sectors and stocks that surged quickly also faced pronounced pullbacks.
The valuation center of many growth companies has gone from previously significantly suppressed to now basically reasonable. Future stock price increases may not rely solely on valuation expansion, but more on earnings growth.
The fund manager also points out: Many stocks whose Q3 reports did not exceed or missed expectations have declined, further reminding us to be cautious in stock selection. The stage of merely “lifting valuations” is gradually passing.
This is a clear, practical judgment, emphasizing that after valuation recovery, performance delivery is becoming increasingly important.
Boundaries for Operational Discipline and Flexibility
After clarifying the market phase, the fund manager also outlines boundaries for operational principles.
This does not alter the medium- to long-term bullish strategic view, but in the short to medium term, individual stock operations need to be particularly prudent and appropriately flexible, with gradual profit-taking when target prices are reached.
This clearly conveys: on one hand, the long-term direction remains unchanged; on the other hand, implementation needs to respect market rhythm, not rigidly hold positions.
Core Manufacturing Layout Direction
In terms of specific allocation, the fund manager returns to the theme of core manufacturing.
The fund remains mainly positioned in domestic core manufacturing industries with competitive advantages and technological attributes. This quarter further refined and sorted the major directions indicated in the last quarterly report, including semiconductor equipment, manufacturing, materials, automotive industry chain (complete vehicles, parts, intelligent driving chain, humanoid robots), lithium battery industry chain, defense sector, computing power and domestic IT innovation-related high-end manufacturing industry chains, wind and photovoltaic energy storage industry chain, and consumer electronics and smart hardware industry chain.
These seven major directions basically cover core manufacturing industries that meet the requirements of new productivity and high-quality development. They are also generally favored by industry policy, have vast market space, and promising development prospects.
This quarter, the fund manager further sorted and refined the holdings, through on-site research and follow-up analysis, gradually concentrated holdings in high-quality leading companies and those with positive earnings trends and potential for high annual growth.
Risk Reminder and DisclaimerThe market has risks, investment needs caution. This article does not constitute personal investment advice and does not take into account the special investment objectives, financial circumstances, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article suit their particular situation. Investments based on this article are at your own risk.
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