On the afternoon of November 20, Lin Yuan, a prominent figure in the private equity sector managing billions, shared his latest investment perspectives. Known for his sharp and often contrarian views, Lin's remarks consistently draw widespread attention.

Lin has frequently defended traditional industries amid the heated debate over "old economy stocks." This time, he elaborated on his rationale, dissecting the underlying logic and future trends with precision. His calm yet incisive delivery underscored his unwavering stance.

Key Takeaways: 1. **AI and Emerging Sectors**: Lin predicts that industries like AI, biotech, and new energy will inevitably face overcapacity and heightened competition, aligning with market cycles—only a matter of time. 2. **Profitability Over Hype**: While acknowledging the potential of new industries, Lin prioritizes investible companies with clear profitability and sustainability over speculative trends. 3. **Traditional Industries' Resilience**: Despite recent downturns, leading firms in traditional sectors have weathered challenges due to scale, capital, and management advantages, with valuations now at attractive lows. 4. **Consumer and Food Sectors**: These industries adapt quickly to market corrections, making them more predictable investments. Lin highlights their enduring demand and operational efficiency. 5. **CSI 300 Appeal**: Core indices like the CSI 300 represent China’s economic backbone, currently trading at historically low valuations with manageable risk. 6. **Investment Philosophy**: Lin emphasizes survival and profitability, favoring businesses tied to essential needs—those that "bring joy" or "extend life."

**AI’s Inevitable Competition** Reflecting on 2025, Lin noted the outperformance of small-cap and "new economy" stocks but cautioned that emerging sectors like AI will eventually mirror traditional industries’ struggles with overcapacity. Market euphoria, he argued, often overlooks this inevitability.

**Traditional Strengths, New Opportunities** Lin dismissed the notion that traditional sectors are obsolete. Headwinds like post-property-boom asset depreciation have already been priced in, leaving select large-caps and indices like the CSI 300 undervalued. "Their demand is perpetual," he asserted.

**"Mouth Economy" Focus** Lin’s strategy centers on consumer staples—products with short shelf lives and agile supply chains. Unlike capital-intensive sectors (e.g., real estate), these businesses correct swiftly when overproduced, minimizing long-term risks.

**Survival Over Speculation** Drawing parallels to past tech bubbles, Lin warned that many hyped companies fail to endure. In contrast, businesses addressing fundamental human needs—food, healthcare—outlast cycles. "Profit certainty trumps novelty," he stressed.

**Future-Proofing Investments** Lin’s long-term vision targets two themes: enhancing quality of life (e.g., health, leisure) and addressing aging demographics. Even amid AI advancements, he believes human-centric services will retain irreplaceable value.

**Caution on Overcrowded Trends** While acknowledging innovation’s role, Lin avoids heavy bets on cash-burning sectors. His metric is simple: "Can the business generate durable profits?" For now, that answer lies in the steady cash flows of consumer and healthcare giants.

**Final Note** Lin’s message resonates as a call for discipline: avoid directional missteps by anchoring to profitability and societal needs. In his view, the "boring" sectors of today may well be the multibaggers of tomorrow.