Morgan Stanley-China Financials The myth of income, spending and financial...-108829010

MJune23,202408:02PMGMTMorganStanleyAsiaLimited+UpdateChinaFinancialsAsiaPacificRichardXu,CFA+8522848-6729+8523963-4624Themythofincome,spendingEquityAnalyst+8523963-2224andfinancialassetgrowthRichard.Xu@morganstanley.comContrarytomarketconcerns,ouranalysisshowsstillhealthyChiyaoHuanggrowthinhouseholdfinancialassets,incomeandconsumptionamidde-riskingeffortsinChina.However,somestructuralEquityAnalystchangesinallocationofincomegrowthandovercompetitionChiyao.Huang@morganstanley.comamonggoodsandserviceproviderscouldbeconcerns.BerylYangHouseholdwealthgrowthremainedhealthyin1Q24withstableincomegrowthamidthehousingmarketcorrection,LGFVcleanupandChina'seconomicResearchAssociatestructureshiftingtowardsindustrialdevelopment:HHfinancialassetsincreasedBeryl.Yang@morganstanley.com9.5%yoyin1Q24,+5.1%YTD,ledbystillelevateddepositgrowthat~12%yoyin1Q24despitesomemoderationindepositgrowthtowards11%inAprilandMay.InChinaFinancialsAttractiveaddition,disposableincomeseemstohavegraduallystabilizedwith1Q24disposableincomepercapitaincreasing6.2%yoy,pickingupfromthelowestlevelin2022.AsiaPacificWhilebothareasofgrowtharemodestlylowerthanpre-COVIDlevels,wethinkIndustryViewtheyarehealthygivenChina'sde-riskingeffortsinrecentyears.MorganStanleydoesandseekstodobusinesswithPaymentandjobapplicationsdatashowsconsumptiondowngradeinfirst-tiercompan...