Dong Chengfei's latest statement! This year, the market will be very "chaotic," and he also mentioned real estate stocks.

On March 14th, the Rui Jun Asset 2026 Strategy Conference was held in Shanghai.

Rui Jun Asset Management Partner and Chief Research Officer Dong Chengfei delivered a keynote speech, sharing his latest thoughts on investment personally and from Rui Jun. Regarding market outlook, Dong Chengfei summarized with the word “chaos,” focusing on analyzing the two major industries: smart cars and real estate. He believes that smart cars are likely to become a profitable business, while the risks in the real estate sector have been fully released. Currently, real estate stocks are high-risk, high-reward investments.

Smart Cars Will Become a Profitable Business

In this year’s “Rui Si” (Rui Jun Asset’s investment research column), Dong Chengfei raised three major topics: 1. What changes will automotive intelligence bring? 2. Real estate or real estate industry chain? 3. Where are the once-hot stocks now?

During his speech, Dong Chengfei dedicated more time to the smart car industry. He believes that automotive electrification is nearing its end, with domestic brands rising and intense competition, but the intelligentization of cars has just begun.

To study the potential changes brought by intelligentization to the automotive industry, Dong Chengfei reviewed the development of smart phones, TVs, and cleaning tools, and drew a series of insights and conclusions. He summarized that the process of intelligentization is one where software and algorithms increasingly add value to products; it brings new value to consumers, thus improving business models to varying degrees. The extent of improvement depends on the difficulty of intelligent products, the depth of iteration, and the scope of functional expansion. There seems to be no direct correlation between intelligentization and industry concentration. Intelligentization can enhance corporate profitability and secondary market valuation levels.

Dong Chengfei believes that currently, smart cars are still in their infancy. In the future, smart cars are likely to be a profitable business, similar to smartphones, with the winners potentially being AI companies disguised as car manufacturers. He further analyzed that automotive intelligentization is a process of AI reshaping the automotive industry, and it is the first entry-level application of AI in the physical world. When consumers are freed from driving tasks, the interaction experience between cars and consumers becomes key, which will change the current homogenization problem and widen the differentiation among brands. The process of intelligentization also involves rapid iteration and brutal reshuffling. Capable companies can gain premium product experience and industry chain influence through differentiation, while less capable companies may become OEMs or exit the market entirely. If smart cars can provide services beyond basic driving, like a good dedicated driver, consumers will pay for it, and companies can also earn stable value-added service income.

Real estate stocks are now high-risk, high-reward investments

Dong Chengfei has been paying attention to the real estate industry since 2024, having previously proposed the idea of a bottoming process. However, last year’s real estate data, including sales volume and prices, fell below his expectations. Since 2025, the housing market has continued to de-stock, with new and second-hand home transactions stabilizing, and rental yields supporting home prices. Based on the current situation, Dong Chengfei remains highly focused on real estate.

He analyzed that over time, the upward beta options for real estate are increasing. Looking at international cases, the decline in the domestic market has been significant, and there are signs of a clear policy shift. For the real estate industry, a “survivor wins” scenario may emerge. Referring to the US situation, industry concentration will increase, market recovery is underway, and related companies have growth potential. The upstream and downstream building materials industry also offers safe allocation, with stabilized income, restored profits, and improved asset quality. The dividend willingness of related companies is strengthening.

Regarding the real estate sector, Dong Chengfei provided his latest thoughts and conclusions. He believes that both volume and prices in the real estate industry are near bottom levels, but there is no particular view on when a reversal might occur—it’s more of an option-like outlook. The risks in the real estate sector have been fully released; some companies may become dominant, but due to the sector’s leverage, it remains a high-risk, high-reward investment. The related industry chain offers medium-risk, medium-reward opportunities.

In the final part of his speech, Dong Chengfei also reviewed several major A-share rallies in history. He believes that this AI wave could enable China’s capital market to produce more outstanding companies.

(Source: Securities Times)