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By Tang Guhan

China’s A-shares have an investment value in the long term, said Yin Zhongli, an analyst from Chinese Academy of Social Sciences on Monday.

Yin thought the accelerated inflows of foreign capital into the Chinese stock markets were due to the favorable policies as well as the long-term investment value of the A-shares.

It is more convenient for foreign investors to invest in the A-shares markets as the Chinese government has broadened its channels such as the Qualified Foreign Institutional Investor (QFII) and ?Renminbi Qualified Foreign Institutional Investors (RQFII), as well as the Shenzhen-Hong Kong stock, Connect and Shanghai-Hong Kong stock Connect, for foreign investors to enter into the Chinese stock markets in recent years.

The A-shares whose market prices slumped below their net assets per share have numbered 261 as of last week, hitting a record high and representing 7.64 percent of the traded shares in the markets.

However, foreign investors are ramping up their investments in the A-shares. Data has shown that foreign investments amounted to RMB 169.612 billion from January to July this year and the figure was RMB 49.8 billion for June and July alone.

Some analysts believe the robust buying of the A-shares at this moment in time was bottom fishing for foreign investors.

It is not convincing to identify the bottoming out of the Chinese shares by depending solely on the number of stocks whose market prices had slumped below their net assets per share, said Dong Dengxin, the Dean of Finance and Securities Institute of Wuhan University of Science and Technology.

“China is in the phase of industrial restructuring, and industries like the heavy chemical industry were still concerned with overcapacity issues. These shares whose market prices had plummeted below their net assets per share were focused in the heavy chemical industry as well as banks, real estates, automobiles and utilities, which reflect the process of restructuring as well as preferences of investors,” Dong added.