BNP Paribas SA, in its most recent analysis, highlights the significant appreciation of the Renminbi over the past half-year but anticipates no substantial negative impact on the equity returns, valuations, and share price performance of Chinese listed companies. This is primarily attributed to the continued minor and relatively concentrated role that overseas revenue plays for these stocks.

William Bratton, Head of Asia Pacific Equity Research at BNP Paribas, notes in the report that among major Asian markets, Chinese equities exhibit the strongest domestic orientation. This characteristic stems from their lower reliance on foreign-sourced income and the comparatively weaker influence of international capital within the Chinese stock market.

Globally, over the past five years, the significance of overseas markets for Chinese stocks has seen an increase; however, the overall proportion remains modest.

In 2024, overseas revenue constituted only 13.6% of the total revenue for listed companies, a slight rise from 12.6% recorded in 2019.

This exposure is highly concentrated, with more than half of the external revenue originating from just ten sub-sectors. Sub-industries such as electronic components, technology hardware, semiconductors, home appliances, consumer electronics, and engineering machinery exhibit relatively high external revenue exposure, each exceeding 30%.

The bank maintains its optimistic perspective on the Chinese equity market, continuing to favor select sub-sectors within the technology, materials, and industrial fields. It forecasts that the Renminbi will appreciate to 6.80 against the US dollar within the current year.