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Recently, numerous bullish stocks have emerged in the realm of state-owned enterprise (SOE) restructuring. On October 22, 2025, the city of Shenzhen released its "Action Plan for Promoting High-Quality Development of Mergers and Acquisitions (2025-2027)," aiming for comprehensive quality improvements in listed companies within the jurisdiction by the end of 2027, with a total market value of domestic and overseas listed companies exceeding 20 trillion yuan and cultivating 20 enterprises with a market value of over 100 billion yuan.

Exciting news has also come from Hubei. On October 16, the provincial deputy secretary and governor, Li Dianxun, inspected the management reform of state-owned "three assets" in Wuhan and held a conference to deploy key tasks. Li emphasized that deepening the management reform of state-owned "three assets" and accelerating the establishment of a large financial system is essential to improving the operational efficiency of state-owned enterprises and is a key support for stabilizing growth, mitigating risks, and safeguarding the people's livelihood. It is necessary to deepen understanding and more profoundly grasp the three principles: to assetify as many state-owned resources as possible, to securitize as many state-owned assets as possible, and to leverage as much state-owned capital as possible. Furthermore, the rational application of the four modes: use if possible, sell if not used, rent if not sold, and leverage if possible will further promote more effective results in the management reform of state-owned "three assets" across the province.

Bullish stocks in SOE reform have been on the rise. Since October, stocks related to SOE reform have seen significant increases. As of the close on October 22, Dayou Energy surged nearly 117%, topping the A-share gainers list, and continued to reach the daily limit halt in early trading today. Hefei Urban Construction soared over 97%, while stocks like Antai Technology, Yellow River Wind, Shanghai Shenda, and Shandong Molong also saw considerable gains.

This morning, Shenzhen's SOE sector collectively experienced substantial growth, with the Construction Science Research Institute hitting the daily limit, alongside a number of other stocks such as TeFa Information (protecting rights), Shenzhen Seagate, and Shenzhen Property A also reaching their daily limits.

Galaxy Securities highlighted that the "14th Five-Year" period is a critical phase for strengthening the counter-cyclical adjustment of central SOEs. Firstly, it is a necessary requirement for better addressing the great changes of the past century. Central SOEs are the backbone of the socialist market economy and are crucial in responding to external changes and major risk challenges. Secondly, it is essential for fostering the accelerated transition of new and old growth drivers. The "14th Five-Year" period is a pivotal time for the transformation of new and old growth drivers, emphasizing the need to develop new productive forces tailored to local conditions. Thirdly, central SOEs are key drivers of technological breakthroughs. Technological innovation represented by artificial intelligence will become a frontline battleground in the China-U.S. competition. Central SOEs should seize the opportunity of this technological revolution and industrial transformation to advance China's technology and industrial development from following to leading.

Industry insiders suggest analyzing the SOE restructuring concept from six dimensions: low market value, low price-to-book ratio, high debt ratio, unsuccessful restructurings in the past year, low market value SOEs in Beijing, Shanghai, Guangzhou, and Shenzhen, and those with low securitization rates. Such stocks often exhibit considerable restructuring potential.

According to statistics from Securities Times and Data Treasure, 15 state-owned stocks currently have a market value of less than 2 billion yuan, with stocks such as *ST Hu Ke, *ST Bu Sen, *ST Jiao Tou, and *ST Gao Si worth less than 1.5 billion yuan. In the central enterprise category, companies like Zhonggong Gao Ke, Yong An Forestry, Daqing Huake, and Linhai Stock also have market values below 2.5 billion yuan.

Regarding the price-to-book ratio, companies like Meikailong, Guiyang Bank, Huaxia Bank, Financial Street, and Zhengzhou Bank are trading below book value; among central enterprise stocks, China Railway Construction, Overseas Chinese Town A, Everbright Bank, and China Railway are also trading below their book values.

In terms of debt-to-asset ratios, stocks such as *ST Jian Yi (protecting rights), *ST Zhong Ji, *ST Hui Cheng (protecting rights), and Jiangxi Tungsten Equipment report debt ratios exceeding 100% in their semi-annual reports; stocks like *ST Nan Zhi, Bayi Iron & Steel, Yin Bao Shan Xin, and Shenzhen Konka A have high debt ratios in the non-financial central enterprise category.

In addition to the aforementioned three dimensions, central SOEs that faced failed mergers and acquisitions this year are likely to pursue restructuring again. Data shows that the following 11 central SOE stocks experienced failed restructurings in the past year: Nannxin Pharmaceutical (protecting rights), Anyang Iron & Steel, *ST Zhong Ji, and Huada Jiu Tian.

Furthermore, SOE stocks from developed regions warrant particular attention. Companies such as Beijing State-owned Assets Supervision and Administration Commission's Jian Gong Repair, Jingneng Real Estate, Jidong Equipment, and Dalong Real Estate have market values below 3 billion yuan; Shanghai SOE stocks like KaiKai Industry, Kai Chuang International, and Yatong Stock (protecting rights) have market values below 3 billion yuan; while Shenzhen SOE stocks such as Jian Ke Yuan, ST Ying Fei Tuo (protecting rights), and Zhongxin Saike have low market values, as do Guangzhou municipal asset stocks, including Tai Mu Shi, Jin Ming Precision Machine, and Pu Lu Tong.

Low securitization rates of central enterprises are also of institutional interest. According to Minsheng Securities research reports, three central enterprises—Aerospace Science and Industry Corp, Aerospace Science and Technology Corp, and China North Industries Group—have securitization rates below 30%. Additionally, Huayu Securities reports that central power enterprises like China Huaneng Group and State Power Investment Group have securitization rates below 40%. Data Treasure has identified these five central enterprises with low securitization rates and their affiliated A-share companies, totaling 12 stocks with a current market value of less than 10 billion yuan.